Calling Franchise Owners

Special Note…

It is natural for you to want to call franchisees that are next door to your target market area. The closest franchisees seem like they could be most helpful but be very careful. The reason you call franchisees is to gain unbiased information. Your entry into the marketplace may have an impact on the franchisee located down the road from you. As a result, their comments may be biased. They may give you the straight scoop, or they may try to scare you off of what they perceive to be their future growth area.

Additionally, they may try to buy the territory from the franchisor before you do. It is not uncommon for a prospective franchisee to lose an opportunity due to an existing neighboring franchisee purchasing the territory. Wait to make those calls until the end of your investigation and enter the conversation with your eyes wide open.


  • They don’t need to speak to you – they get no benefit out of speaking to you – they really do it out of the goodness of their heart – they might get a pat on the back.
  • No financial rewards for talking to you – that is why you want to talk to them
  • The first thing to keep in mind is all Zees will not want to speak to you or will they be willing to speak with you.
  • That is why you want to call a lot of them
  • Some won’t return your phone calls – don’t let that bother you – just call another.
  • Start with softball questions.
  • How did you get into this
  • Would you do it again
  • Are you being treated right – all that kind of stuff
  • You want financial information or you wouldn’t be making these calls – right? This is what you DON’T WANT TO SAY!
  • A lot of people will begin the conversation with saying:
  • “I really want to talk to you about financial information, could you tell me how much money you make?
  • “How long your business took to break even”
  • They start off on the bottom line of the P&L
  • This does 2 things – turns people off and also even if they answer the question it will do more to mislead you than to inform you because everyone’s break even is different.
  • If you ask how much is your salary – that depends on how you have your business set up and tax ramifications.
  • How long it takes to break-even – we don’t know if they are putting personal expenses through and a big salary.
  • You want to assume they are not savvy.
  • So here is the plan – you want to say – “I am putting together a P&L – can you help me some of the line items on the P&L. Can I go through my line items to make sure I have them all?
  • I understand there are some cost of goods in here – I have 49% - does that seem right?
  • They know all their line items – they pay their bills by them
  • How do you do payroll?
  • What about marketing – do you pay a royalty? If so, how much.
  • What do you expect your gross sales to be this year?

Now you have everything you need to do a spreadsheet. Now you can find highs and lows with the other owners

Then you can balance it to the Item 19


Phyllis Pieri

Mission Viejo, CA