Buying a Franchise
Learn what you need to know before you sign up
Buying a franchise can be a great move for a would-be entrepreneur wanting to acquire a business model that already works on every level, from branding to pricing to marketing. It is fast becoming a strong way to enter and grow a business within New Zealand – we’re the most franchised country in the world* with $27.6 Billion of business format franchises. But making it work as a successful franchisee can be a lot more complicated than simply finding an appealing franchise brand and buying into it, therefore confidence with whom you franchise with is crucially important. *per capita. GDP figure from Statistics New Zealand
If you’re thinking of becoming a franchisee, how should you prepare yourself?
1. Take our FREE Franchisee Pre-Entry Training Course
We suggest before applying for franchise information and engaging in advice that you first complete the online Franchisee Pre-entry Training Course. This programme consists of 6 short, easy-to-follow modules that can all be completed at your own pace. The course has been designed to help you better understand franchising, your suitability for it and important information and guidance to consider when evaluating the purchase of a franchise opportunity.
2. Seek advice
FANZ has many experienced and knowledgable Affiliate Members that can assist you in getting set up in a franchise. Talk to a few different advisors to see who you feel you easily relate to and who demonstrates that they understand the role you require of them. It is important to choose who you feel is a right fit for you as they guide you through what is an important life decision.
Ask your adviser if they are a member of the Franchise Association of NZ. FANZ has a comprehensive list of Affiliate Members who adhere to the FANZ Codes and Rules and have been independently checked prior to being approved as a member. The advisors that you will most likely need to engage with are Franchise Specialist Consultants, Accountants, Lawyers, Bankers and Service Providers.
3. Buy from a FANZ Member
Signing up with a FANZ Member gives you the security that the Franchisor is bound by the Franchising Code of Practice and the Code of Ethics, therefore is committed to best-practice franchising, has high standards and is dedicated to keeping them that way. All FANZ Members offer a seven day cooling-off period, which means you have time to reconsider if you realise it‘s not for you. FANZ Members offer a dispute resolution process in their agreements to protect your ongoing relationship. As a member franchise, both you and your employees are supported and can request direct support from FANZ. FANZ cannot support you if the franchise system you buy into is not a member.
Questions to consider
- What time do you have available for the business?
- Are you prepared to give up the security of a regular income?
- Are you prepared to take on the responsibility of managing a business?
- Do you have the total support of your partner?
- What should you do if the business fails or does not perform up to expectations?
Other key areas to investigate
- Research franchising as a business format
- Decide what Industry and type of role you are interested in
- Understand the evaluation/recruitment process – refer Pre-Entry Online Education
- Prepare for the interview
- Complete a Site/Field Visit and talk to other Franchisees
- Understand the contents of a Disclosure Document
- Understand the contents of a Franchise Agreement
" We tell prospective franchisees that we are proud members of FANZ and we encourage them to do the free on-line pre-entry training that is available through FANZ. "
" Attending the annual conference allows us to meet and discuss issues, challenges and successes with industry peers and get some fantastic insights into the franchising sector in general. "
" Whether a new or an established franchising business, we highly recommend joining FANZ. Not only do they guide you around the complexities of operating a franchised system, the backing of specialist advisors and a knowledgeable franchising community offer ongoing guidance to those looking to grow a successful franchise with strong and secure foundations. "
" The education that FANZ provides is invaluable. I have attended as many seminars and conferences as I can to identify and address areas where I can improve. "
" I am proud to be a member of FANZ. It means any potential franchisee can have confidence they are entering a credible franchise system that acts with integrity and fairness, and complies with the FANZ codes of Ethics and Conduct "
" Relationship building has been one of the most significant member benefits for me and the businesses I have managed. FANZ members are willing to share information, experience, knowledge and support. It’s like being in an extended family. "
" With employment, safety and food safety legislation ever increasing, I feel that FANZ working alongside the government is a hugely important part of the association’s role. "
" Being a franchisor / General Manager can be lonely and it’s not always human nature to share stories of hard times, failure or struggles. However, when you’re connected to a group of like-minded business people who have travelled a similar path, you’ll find yourself supported & encouraged. "
" Being members ensures we keep up to date with relevant issues and changes, and ensures we are aligned with Best Practice in Franchising. The NZ franchising community is very collegial and supportive. Franchisors are amazingly willing to share their knowledge with each other. "
" The FANZ conference is incredibly informative and a great place to improve your knowledge about franchising. One of the other key benefits is having so many franchisors in one place at one time means it’s a great venue for networking and relationship building. "
" The association provides a voice for the many franchise systems in New Zealand to ensure any legislative changes that could have an impact on franchising are made through the right government channels. The association has done an exceptional job here over the years. "
" We find the awards particularly useful for inspiring staff and franchisees and usually take a large group to the awards evening. The celebration of achievement is a real boost to morale. And of course it is a great achievement for our business to receive recognition. "
" Knowing that FANZ have a strong and proactive advocacy approach to legislation that may affect their members is a significant member benefit. SKiDS recommends other franchise systems to also join FANZ – if we want FANZ to have a strong voice when advocating with Government then we need to have a strong and diverse membership body to back them up. "
" I have personally found the conferences to be a highlight of my year. What I have learned and the knowledge sharing has been of tremendous value. "
" Recruitment is a large part of our business and making sure potential franchisees are aware of our affiliation with FANZ helps authenticate our company. This relationship reassures any potential franchisees that we are part of a larger franchising regulatory body that ensures we adhere to a strict set of codes and rules. "
" When recruiting new franchisees, we explain that we are focused on best practice and they must seek advice from professionals as per the FANZ Code of Practice. It enhances our credibility. "
" Amongst other initiatives, our FANZ Board has a clear focus on building and strengthening the relationship between FANZ and the Government. I believe it is incredibly important that Government agencies see FANZ as the ‘go-to’ body for any legislative changes that may impact franchising. "
" Realising you are not alone in the world of franchising and knowing any situations you find yourself in, other members probably have been there too and therefore can advise on their experience and outcomes "
" We joined, and continue to be a member of FANZ, because it represents what’s good and right about franchising; it’s ethical, credible and has integrity. As members, we voluntarily adhere to the FANZ Codes and Rules. "
" “We have won several FANZ awards. The process of entering forces you to look at your business in a very analytical way that perhaps you would otherwise not take the time to do. "
" It was a complete surprise that we ended up winning the Supreme Franchise System of the Year. This has been a huge boost to us and we are currently processing Franchise enquiries at a level I never thought possible. "
" It is important for franchises to come under the umbrella of the Franchise Association and see it as an investment to succeed in franchising. Otherwise you stand alone, without the continuing support and education that you need to build your business. "
" It is extremely important that FANZ represents us in government. Who else will advocate for franchises in New Zealand? We need Government to know about the good work that is being done to assist people into successful businesses. "
" It is hugely important to have representation for franchising. Individual systems do not have the resource to do this on their own so to have a body acting on your behalf is great. FANZ have a strong board and base of legal members who have a real strength in this area. "
" The awards gives us an opportunity to put forward some of our top performing franchisees, giving them the well-deserved opportunity to be recognised and awarded on a national level. "
" Credibility and networking with other franchisors is incredibly valuable. The franchise sector is very supportive and there is significant sharing of ideas and information – more so than any other association or environments I have been involved with. "