Free Franchisee Validation Call Questions Template
A list of questions to ask current and former franchisees before buying a franchise: real revenue, costs, support, fees, territory and whether they would buy again.
Franchisee validation means calling current and former franchisees, listed in Item 20 of the Franchise Disclosure Document, to learn what owning the franchise is really like. Their answers on revenue, costs, support and exits are often more useful than the franchisor's sales materials.
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FRANCHISEE VALIDATION CALL QUESTIONS Franchise: [BRAND] Franchisee called: [NAME, LOCATION] Current / former: [CURRENT/FORMER] Date: [DATE] Tips: Call at least [5] current and [2] former franchisees from FDD Item 20, choosing some yourself rather than only those the franchisor suggests. Ask the same questions to each, take notes, and respect their time (15 to 30 minutes). 1. BACKGROUND - How long have you owned your franchise, and what did you do before? - Why did you choose this brand? 2. MONEY - How close was your actual start-up cost to the Item 7 estimate? What cost more than expected? - How long did it take to break even and to pay yourself a salary? - Roughly what are your annual sales and margins? (Ask only if they are comfortable sharing.) - How do your results compare with the Item 19 figures, if any? - Which recurring fees surprised you (royalty, ad fund, technology, required purchases)? 3. SUPPORT AND OPERATIONS - How good was the initial training? What was missing? - How responsive is the franchisor when you have a problem? - Do the required suppliers offer competitive prices? - Does the national marketing fund bring you customers? - How often does the franchisor change requirements that cost you money? 4. TERRITORY AND COMPETITION - Is your territory protected in practice? Has the franchisor or another franchisee competed with you? - How does online or delivery business affect your territory? 5. RELATIONSHIP AND EXIT - Have you had any disputes with the franchisor? How were they resolved? - Is there a franchisee association? Is it independent? - If you have considered selling, how easy is the transfer process and what does it cost? - (Former franchisees) Why did you leave? What happened with your lease, equipment and non-compete? 6. THE KEY QUESTIONS - Knowing what you know now, would you buy this franchise again? - What do you wish you had known before signing? - Who else should I talk to? NOTES AND RED FLAGS [Record answers, patterns across calls, and any concerns to raise with the franchisor or a franchise attorney.] --- This free template is provided by ClauseAudit for general informational purposes and is not legal advice. Have it reviewed before use. Replace all [BRACKETED] placeholders.
When to use this template
- Evaluating a franchise after receiving the Franchise Disclosure Document.
- Before signing a franchise agreement or paying a franchise fee.
- Comparing two franchise brands.
How to fill it in
- Pick franchisees from the FDD Item 20 list, including some you choose yourself.
- Call current and former owners, including in markets like yours.
- Ask the same questions to each and record the answers.
- Compare their answers with the FDD, especially Items 7, 19 and 20.
- Share concerns with a franchise attorney before signing.
Key clauses to check
- Item 7 vs reality
- The most common surprise is higher start-up and working capital costs.
- Item 19
- Earnings claims are optional and may cover only top performers.
- Former franchisees
- Often the most candid about problems and exits.
- Transfer and exit
- Shows whether you can sell if things change.
Frequently asked questions
What is franchise validation?
Talking to current and former franchisees to check the franchisor's claims and learn what ownership is really like.
Where do I find franchisees to call?
Item 20 of the Franchise Disclosure Document lists current franchisees and those who left in the past year.
What should I ask a franchisee before buying?
Real start-up costs, time to profit, recurring fees, quality of support, territory protection and whether they would buy again.
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This free template is general information, not legal advice, and is no substitute for a qualified attorney. Laws vary by state; have it reviewed by a lawyer before you use or sign it.