THE IMPORTANCE OF VALIDATION WHEN EVALUATING A FRANCHISE

By Tiffany Dodson

Validation is the part of the franchise discovery process where the franchise prospect speaks with existing franchisees. Understanding what to evaluate will help the prospect reach their final decision whether to become a franchisee of this concept. Validation plays a vital role in learning more about the franchise directly from the franchisee’s perspective.

During validation, the prospect gathers information from existing franchisees and former franchisees, if they choose. Franchisees may answer questions about their experiences in the franchise, their unit’s (units’) financial performance, and daily life running this concept. The franchisee may also impart lessons learned that will help the prospect should they move forward. As a prospect, keep these six points in mind during validation:

01 Everyday Perspective: The franchisee can answer questions and share what it is like day to day as a franchisee of the concept. What skills they use, what support they receive, as well as challenges encountered. Asking about the franchisee’s daily routine will give the prospect an idea if this is something that they would want to do regularly. All work has small pieces that are less fun than others; yet, overall, the daily routine should seem appealing. 02 Franchisor–Franchisee

Asking about the franchisor and the relationship will show whether the franchisor operates transparently. In these questions, the prospect will learn if the two have open communication and if the franchisor is responsive to the franchisee. Closed communication is a red flag since healthy two-way communication helps not only the franchisee grow their business faster, but also helps the franchise system grow stronger.