What to Expect during the Site Selection Process
The importance of site selection
Even if criteria differ by business, every entrepreneur knows: location plays a determining role in the success of almost every franchise business.
To help you understand the value of good site selection support from a potential franchisor, we’ll take you through our process, and then give you some questions to ask potential franchisors.
The site selection process – how it works
1. Preparing for the search
• We give our future franchisees an introductory manual with detailed site criteria for our industry, and the basics on commercial real estate.
• If needed, we provide a referral to a local commercial broker with experience in either franchising or our industry.
• For the franchisee’s particular market, we provide a market ranking report that ranks by zip codes, based on relevant demographics and other granular information.
2. Identifying Potential Sites
• The broker takes the lead in the search, while we participate in weekly phone calls with the future franchisee and the broker.
• Once the broker identifies potential sites, we provide a detailed site analysis report for each site.
• The future franchisee selects one or several potential sites.
3. Negotiating Terms
• We help to negotiate a non-binding letter of intent (the business details of the contract) for each potential site.
• Once a letter of intent has been finalized and the future franchisee has officially selected one site, we assist along with an attorney in final contract negotiations.
Questions to ask when vetting a franchise opportunity
1. Do you have a realty department?
Considering the importance of finding the right site and the complexity of commercial real estate, having staff dedicated to site selection support makes a big difference.
2. What support does the realty department provide?
Look for regular contact, market reports, advice about sites and help with contract negotiations. A manual alone is almost never sufficient to find a great location on the right terms within a reasonable amount of time.
While the site selection process is crucial and complex, it can progress without difficulty if a potential franchisor provides the support you’ll need.
Contact us by posting questions and comments below. If you have an idea for a topic you’d like to see discussed here, email us at firstname.lastname@example.org.