What Are The Qualifications to Buy a Franchise?

5 Things You’ll Need to Qualify to Buy a Franchise

The best Canadian franchises won’t partner with just anyone, they are looking for people who have the right experience, personality and resources to thrive as a franchisee. Beware of franchises that don’t ask a lot of questions about you and your background before offering a franchise — they should be looking for franchisees who will be business partners for years to come, and a lack of due diligence is a big warning sign.

The best franchisors will ask you a lot of questions. Here are some of the things you need to know about yourself in order to qualify for one of the best Canadian franchise opportunities.

Your net worth: Starting and sustaining a business requires money. You may need to tap into your assets in order to get your business past the startup phase and to the point where it is generating profits. Franchise systems know this, which is why they set requirements for the net worth of prospective franchisees.

Liquid capital: How much money do you have in banks accounts, or in assets that can be leveraged? While there are financing options available for franchisees, you will need to invest in startup costs. I advise clients to aim for a 50-50 balance between cash investment and financing.

Skills: Do you have sales or customer service experience? Have you ever managed people? Are you meticulous and data savvy? Franchisors look for people with transferable skills. For instance, a manufacturing company manager might make a great printing company franchisee — he is already accustomed to project management, handling employees and paying attention to the small details that improve operations. A former real estate agent might make a great internet marketing company franchisee — her sales skills will help her win clients and close sales.

Personality: You may love the idea of running a senior care business, but can you handle emotional situations with empathy and professionalism? You may like fast food restaurants, but do you have the patience to manage a team of young, inexperienced workers? There are more than 1,200 Canadian franchise opportunities. It’s important to assess your personality and desires before you start narrowing down the list of franchises you are willing to consider. There are probably great concepts out there that you’ve never heard of, but for which you are perfectly suited.

Drive: A good franchise system provides the training, support and tools you need to run and grow a business — but it’s still up to you to do the work. It’s not enough to have a passion for a business — you need to know how much effort it will take to grow the business and to keep it humming once it has hit its stride. Some franchises require much longer hours than others. Some franchises have hours that are closer to a typical workday. You need to carefully consider the work/life balance  you are seeking, as well as your financial goals. Are you going to be able to put in the effort needed to achieve the results you desire?

Jun 20, 2013