When you are trying to decide on a franchise, one of the most important steps in the process is your “discovery day.” This is when you spend a day (or more) at the franchisor’s headquarters, meeting the company’s executives and getting a hands-on experience of the brand. You will be paying for your trip, and it will take time that you could be devoting to other activities, so it is important to make sure you get the most out of the process. Here are some tips from national franchisee lawyer Jeffrey M. Goldstein.
Discovery Day Tips from National Franchisee Lawyer Jeffrey M. Goldstein
Tip #1: Make Sure Attending the Discovery Day Will Be Worth It
Since attending a discovery day involves an investment of both time and money, it is important to try to make sure that attending will be worth it. Not just anyone can attend a discovery day—you need to receive an invite, and receiving an invite can make you feel both excited and pressured to attend.
But you don’t have to attend if you don’t want to, and when you receive an invite, you may or may not be ready to decide whether you want to go. That’s totally fine. If you are considering multiple franchise opportunities—which you should be—you can continue to do your due diligence until you narrow down your list of candidates further. The invite should still be open, and if it isn’t, this may be a sign that the franchisor was more interested in making a quick sale than finding the right franchisee.
Tip #2: Prepare Thoroughly for Your Discovery Day
Once you schedule a discovery day, you should start preparing for your day (or days) at the franchisor’s headquarters. The more you prepare, the more you will get out of the process. Some of the steps you should take to prepare for your discovery day include:
- Reading the Franchise Disclosure Document (FDD) and writing down any questions you have about the franchisor’s disclosures
- Reading the franchise agreement and writing down any questions you have about the franchisor’s terms
- Researching the franchisor online as thoroughly as possible
- Talking to current and former franchisees before you go (they may be able to provide advice on questions to ask or things to watch out for, or they may convince you that you should schedule a discovery day with a different franchisor instead)
- Thinking about what you want to get out of the process and writing down a list of notes that you can use to make sure you don’t overlook anything during your visit
Tip #3: Play an Active Role in the Process
During your discovery day, you can expect the franchisor to have a set schedule, and you can expect to have a chaperone who guides you throughout the day. This is fine, but you should seek to play an active role in the process as well. After all, this is your opportunity to decide if you are prepared to invest in the brand, so you need to make sure the process is as worthwhile as possible.
Tip #4: Ask Lots of Questions
A typical franchise discovery day will involve lots of meet-and-greets, and you may sit down with some individuals for what are effectively interviews. You should try to ask as many questions as possible during each of these meetings—in addition to asking your chaperone questions throughout the day. While you should feel free to ask any questions you want answered, here are some topics you should be sure to cover:
- Each individual’s tenure with the franchisor and role within the franchise system
- The franchisor’s short-term and long-term growth plans
- The franchisor’s marketing strategy, particularly in your geographic area
- Any significant developments or innovations that are in the pipeline
- The franchisor’s primary competitive challenges and how it overcomes these challenges
Tip #5: Take a Mental Note of Any Red Flags
As you go through the day, you should try to retain as much information as possible. This is especially true with regard to any red flags. For example, if anything stands out that makes you concerned about the franchise system’s trajectory or how the franchisor manages its franchisee network, this may be something that requires careful consideration. Likewise, if any of the information you receive during your discovery day is substantially different from the information in the franchisor’s FDD or information provided to you during an earlier event, this may be cause for concern as well.
Tip #6: Take Detailed Written Notes at the End of the Day
Along with taking mental notes of any red flags throughout the day, at the end of the day, you should also sit down and write down as many details as you can remember. You can do this however works best for you. Some people like to make lists of positives and negatives, while others prefer to write journal-style entries that recount the day’s events. The key is to record as many details as you can so that you can retain as many insights from your discovery day as possible.
Tip #7: Use Your Discovery Day to Help Yourself Make an Informed Buying Decision
Finally, as you prepare for your discovery day, it is important to keep in mind that you are still very much in the due diligence process. While you should have enough interest to make investing your time and money in a discovery day worthwhile, you should not go into your discovery day already committed to the brand. You should use the information you receive during your discovery day to make an informed buying decision—whether this means investing in the brand or looking for a different franchise opportunity.
Request a Free Consultation with National Franchisee Lawyer Jeffrey M. Goldstein
If you are going through the franchise buying process and would like to know more about the steps involved in making an informed decision, we invite you to get in touch. To request a free consultation with national franchisee lawyer Jeffrey M. Goldstein, please call 202-293-3947 or inquire online today.
