DEVELOPING A DIAGNOSTIC

QUESTIONNAIRE
AS AN AID TO
FRANCHISEE SELECTION

Professor John Stanworth

INTERNATIONAL FRANCHISE RESEARCH CENTRE

SPECIAL STUDIES SERIES NO.6

MAY 1995

PUBLISHED BY UNIVERSITY OF WESTMINSTER PRESS

ISBN 1 85919 056 1
THE INTERNATIONAL FRANCHISE International Journal (MCB University
Press). Additionally, Franchise Growth And
RESEARCH CENTRE (IFRC) 1993-2007
Failure In The U.S. And The U.K.: A
University of Westminster, London, UK.
Troubled Dreamworld Revisited received the
Best International Paper Award in 1997,
"The International Franchise Research
again from the Society of Franchising. This
Centre (IFRC) is committed to
paper was later published in Franchising
improving the understanding of
Research: An International Journal.
franchising. This is achieved by the
publication of impartial research and
Close links were fostered with universities in
by the encouragement of informed
Rome and Pisa (Italy), Haute Alsace
debate."
(France) and Boston, Minneapolis and
Texas (USA), with a view to research
Franchising operates in a dynamic environ-
collaboration. Professor Pat Kaufmann of
ment, with new issues and challenges
Atlanta, Georgia, addressed our inaugural
emerging, including: globalisation, coping
annual strategy seminar, in 1994. Overseas
with competition, disclosure, industry
speakers in subsequent years included
regulation, managing relations with
Cheryl Babcock, Director of the Franchising
franchisee associations, franchisee
Institute, University of St. Thomas,
recruitment & market saturation.
Minneapolis (1995), Professor Rajiv Dant,
University of Boston (1996), Professor
Against this backdrop, the IFRC was
Francine Lafontaine, University of Michigan
established in 1993 by Professor John
(1997), Professor Claude Nègre, University
Stanworth (Director of the Future of Work
of Haute Alsace (1997), Colin McCosker,
Research Group at the University of
University of Southern Queensland (1998),
Westminster), supported by Brian Smith (ex-
Professor Frank Hoy, University of Texas at
BFA Chairman, franchisee, franchisor and
El Paso (1998), Professor Jack Nevin,
author), and Chair of its Steering Group.
University of Wisconsin-Madison (1999),
Professor Tom Wotruba, San Diego State
FOUNDER MEMBERS
University (1999), Professor Bruce Walker,
University of Missouri, (2000), and,
Founder members and sponsors included:
Professor Wilke English, University of Mary
Barclays Bank, the British Franchise
Hardin-Baylor (2000).
Association (BFA), Dyno-Rod, Franchise
Development Services Ltd., Lloyds Bank
IFRC members were active supporters of the
(now Lloyds Group), Mail Boxes Etc.,
International Society of Franchising, and
Midland Bank (now HSBC), Prontaprint,
hosted the ISoF 2005 conference in London.
Rosemary Conley Diet & Fitness Clubs,
Royal Bank of Scotland, The Swinton Group,
The IFRC ceased its research activities in
and Wragge & Co.
2007, when John Stanworth took retirement.
PUBLICATIONS
Web versions of IFRC Special Studies
Series Papers 1993-2001 (listed overleaf)
Their support enabled the IFRC to publish a
number of reports, including its Special
Many of the earlier papers have been re-set,
Studies Series Papers, journal articles,
to allow a successful conversion to Acrobat,
book chapters and conference papers.
and are now available online.
Two IFRC papers received three awards
John Stanworth, Emeritus Professor,
over a period of 12 months (1996-97). The
University of Westminster
first being Business Format Franchising:
http://www.westminster.ac.uk/schools/
Innovation & Creativity or Replication &
business
Conformity ?, which received the Best
International Paper Award in 1996, from the
David Purdy, Visiting Fellow,
Society of Franchising. This paper also
Kingston University
received the Outstanding Paper of 1996
http://business.kingston.ac.uk/sbrc
award from Franchising Research: An
December 2010

International Franchise Research Centre Special Studies Series Papers 1-16 Web Versions 2010 p.1
LIABILITY DISCLAIMER
The information and analysis in each report
is offered in good faith. However, neither the
publishers, the project sponsors, nor the
author/s, accept any liability for losses or
damages which could arise for those who
choose to act upon the information or
analysis contained herein.
IFRC Special Studies Papers 1993-2001
10 London: A Capital City For Franchisee
Recruitment, (Mills, Stanworth &
Purdy), 1997
11 The Effectiveness of Franchise
Exhibitions in the United Kingdom,
(Chapman, Mills & Stanworth), 1997
12 Franchising: Breaking Into European
Union Markets, (Stirland, Stanworth,
Purdy & Brodie), 1998

Web versions published online December 13 Succeeding As A Franchisor,

2010, via http://www.scribd.com/:
1 The Blenheim/University of
Westminster Franchise Survey:
Spring 1993, (Stanworth & Purdy),
1993
2 Improving Small Business Survival
Rates via Franchising: The Role of the
Banks in Europe, (Stanworth & Stern),
1993
3 Targeting Potential Franchisees:
Industry Sector Backgrounds and
Declared Areas of Interest, (Purdy &
Stanworth), 1994
(Stanworth & Purdy, published jointly
with Business Link London Central),
1998
14 Direct Selling: Its Location in a
Franchise Typology, (Brodie &
Stanworth), 1999
15 Unravelling the Evidence on
Franchise System Survivability,
(Stanworth, Purdy, English &
Willems), 1999
16 Survey: Professional Services For
Franchising In The U.K., (Stanworth &
Purdy), 2001

4 The Impact of Franchising on the

Development Prospects of Small &
Medium-sized Enterprises (SMEs) in
Europe, (Stanworth & Purdy), 1994

5 The Blenheim/University of
Westminster Franchise Survey: A
Comparison of UK and US Data,
(Stanworth, Kaufmann & Purdy), 1995

6 Developing a Diagnostic
Questionnaire as an Aid to Franchisee
Selection, (Stanworth), 1995

7 Franchising as a Source of
Technology-transfer to Developing
Economies, (Stanworth, Price, Porter,
Swabe & Gold), 1995

8 Aspects of Franchisee Recruitment,

(Macmillan), 1996

9 Business Format Franchising:

Innovation & Creativity or Replication
& Conformity ?, (Stanworth, Price,
Purdy, Zafiris & Gandolfo), 1996

International Franchise Research Centre Special Studies Series Papers 1-16 Web Versions 2010 p.2
INTRODUCTION
The question of who will make a good
franchisee is one which exercises the minds
of all franchisors. The statements below,
plucked from franchise various sales
brochures and articles, quite clearly spell out
the overriding importance of franchisee
selection:
■ "Franchising is a partnership. A franchise's
major asset, once established, is its
franchisees."
■ "A model franchise company will recruit as
franchisees people who are not only
qualified financially, but also by ability,
energy and enthusiasm to make the most
of the opportunity available to them."
■ "Setting up a franchise is less difficult than
managing it later on - you have to live with
your earlier mistakes and a lot of those
are people you pick when the urge for
rapid growth takes over from all other
considerations."
PICKING WINNERS
Picking winners is not a simple task and the
difficulties inherent in the situation tend to be
compounded by a number of additional
factors:
■ Most developing franchises have much in
common with the typical small firm in that
they have only a few key staff members
undertaking a multitude of tasks. These
may be very able and committed people
but, usually, none of them is expert in the
field of personnel selection and
management, which is the relevant
specialism here.
■ Some franchisors may feel that they can
rely on 'instinctive' or 'gut' feelings to signal
good or bad franchises prospects. Just as
few people would admit to being a bad
driver, so they feel it reflects badly upon
them to admit to difficulties in selection
personnel.
■ Very often people fall into the trap for
looking for people exactly like
International Franchise Research Centre - Special Studies Series Paper No.6
themselves when what they may be best
advised to do is look for people who
complement rather than duplicate their
own abilities and weaknesses.
■ Inasmuch as franchising is a team effort,
one of the key front line teams is the
franchisee husband/wife team. If this team
is not operating effectively, then a source
of potential strength can descend into a
weakness.
COSTS & CONVERSIONS
For businesses having 4 or more years
experience of franchising, research has
indicated that nearly 60% report an average
recruitment cost in excess of £5,000 per
franchisee (1994 prices).
This cost is a reflection of appreciable
numbers of applicant rejections and most of
the more professional franchise companies
convert no more than 4% of initial enquiries
for franchise prospectuses into sales. Even
this is judged by some to be, if anything, on
the high side with 2% being a better target
figure. But why should this figure be so low ?
One reason is that self-employment is a pipe-
dream for quite a large army of people who
like to indulge in 'half-way-house'
experiences. They may subscribe to small
business magazines, attend seminars, join
business clubs and, in this way, get an arm's-
length thrill of a 'share of the action'.
Some of these people may, eventually, take
the plunge, should they lose their job, or come
into money, etc. But, in the meantime, they
are not serious prospects.
Another reason is that self-employment is a
widely held desire in our society, albeit one
that is often associated with very little
knowledge of precisely what is involved.
Grand notions abound of independence -
'doing your own thing', 'no one looking over
your shoulder', 'being able to play a round of
golf midweek when the course is empty'.
Thus, the bait is strong enough to at least
initially interest a great many people.
Finance is often thought to be no great
1
problem by potential franchisees since, as
they see it, the clearing banks exist to address
precisely this problem. However, many
prospects will never have raised bank loans
before and the idea of having to offer security
or collateral (their house perhaps) can often
come as a shock to them.
PSYCHOLOGISTS
Some psychologists have made an industry
out of attempting to devise tests which will
predict those likely to make a success of
running their own small business and those
who are unlikely to do so. Whilst success in
the field of psychological profiling here has
been very limited, it is perhaps worth
mentioning a couple of the more hopeful
approaches.
Probably the best known is that associated
with Professor McClelland and his attempts to
measure 'achievement-need', or 'the desire to
do well for the sake of an inner feeling of
personal accomplishment'. In the 1960s this
was used in many countries for selection and
training purposes but, after some initial claims
of success, has come in for increasing
criticism.
Another psychological test is the so-called
'locus of control', which is based upon the
proposition here that potentially entrepreneurs
will have a high 'locus of control' or, in other
words, believe that they can control their own
behaviour and that their behaviour determines
what happens to them. Put simply, this
amounts to a belief that they control their
environment rather than the reverse. Again,
there have been some successes claimed
here but locus of control testing is still not
widespread in the field of entrepreneurial
selection. Also, knowing that many people
who become self-employed have been
'pushed' by environmental circumstances,
e.g., redundancy, a locus of control test would
not appear very appropriate.
There appears to be a common
misconception amongst franchisors that
franchisees are very different animals from
conventional independent small business
people. However, research shows that around
one-third of franchisees have previously been
conventional small business people and
International Franchise Research Centre - Special Studies Series Paper No.6
around half of all potential franchisees
attending franchise exhibitions have current or
previous experience of conventional self-
employment.
LOOKING THROUGH THE EYES OF
POTENTIAL FRANCHISEES
It is important to keep in focus the goals of
potential franchisees. Their prime aim in life is
not, and will never be, to make your firm 'the
biggest in its market'. Potential franchisees
will have their own goals and these will vary
with their past experience.
For instance, we now know that people
without any previous experience of self-
employment have goals practically identical
to most other people in their situation. Thus,
their main goal is the search for
independence and autonomy, achieved
through structuring their own time and efforts
rather than being directly supervised and
controlled by others.
For potential franchisees with previous
experience of self-employment, the lure of
franchising as a proven business system
takes prominence. Thus, goals such as
'security', 'access to a known tradename' and
'business backup' assume great importance.
SOME GUIDELINES FOR THE FRANCHISOR
Some franchise companies may wish to
explore the possible advantages of
psychological profiling in depth. If so, they
would be well advised to seek specialist help.
Short of this, what do the lessons of research
and management theory generally hold to
assist the franchisor in improving franchisee
selection methods ?
In a nutshell, they offer 3 main messages for
the franchisor:
■ First we know that people who have either
first hand experience of self-employment
themselves or, alternatively, come from a
family which has such experience, are
statistically more likely to take up
franchises than people randomly drawn
from the population. Thus, ensure that you
are delving this question at an early stage.
2
■ Make use of standard personnel selection
techniques to ensure that your interview
and selection techniques are as scientific
as possible and protect you against
subjective or whimsical judgements. For
instance, you should develop a proper
franchisee role description outlining the
purpose, functions, responsibilities,
conditions and prospects linked to the role.
■ Then, you should have a proper franchisee
specification which should outline the
kind of person best suited to the role. This
document should be based upon the
answers to 2 questions: which attributes
are essential in a franchisee and which
are desirable.
■ In addition to the above, you should
develop your own diagnostic
questionnaire schedule, suited to your
own franchise operation (see below).
Whilst it remains true that there is no single
foolproof formula, or litmus paper test, that will
guarantee a franchisor 100% success in
selecting good franchisees, the more scientific
the approach used, the better your choices
should be, thus bringing long-term benefits for
franchisors and the franchise network. The
remainder of this paper will concentrate upon
assisting franchisors to develop their own
diagnostic questionnaire schedule.
THE DIAGNOSTIC FRANCHISEE QUESTIONNAIRE
The following diagnostic questionnaire was
developed by Professor John Stanworth of
the University of Westminster's International
Franchise Research Centre. It can be used in
exactly the form outline below or,
alternatively, can be modified to fit any
franchise company's precise needs.
When Should It Be Used ?
The timing of the franchisor's use of the
Diagnostic Questionnaire can be organised
to suit the needs of individual companies but
the possibilities are numerous:
■ It can be sent out with the company's initial
information pack as part of a first response
to enquiries. This can have the advantage
of making prospects think through their
International Franchise Research Centre - Special Studies Series Paper No.6
own position whilst spelling out some of the
issues involved in being a franchisee. This
initial educational function can be useful in
'cooling down' some of the 'dreamers'.
Franchisors might even suggest that
potential franchisees not only complete the
exercise for themselves but also get other
people who know them to complete it for
them as an aid to checking out the image
others have of them. Both versions should
then be returned to the franchisor for
discussion at the interview stage.
■ It's use can be delayed until, say, the first
interview stage when the franchisor has
the choice of allowing the prospective
franchisee to complete it in private
unprompted, or with the franchisor
administering it as part of a face-to-face
interview.
■ It can be used when discussions are well
advanced and then used to the
advantages of both parties as an additional
check of their understanding of one
another.
Which of the above alternatives is preferable
depends on the franchisor's other selection/
recruitment techniques but, on balance, the
first probably has most to offer since it makes
the prospective franchisee think through his/
her situation as well as providing the
franchisor with valuable information later on.
Questions
Twenty questions are listed below and these
are designed to get the potential franchisee to
analyse his/her ability to:
■ Cope with the isolation of self-employment
(Q1)
■ Exercise self-discipline (Q2)
■ Work long hours under pressure (Q3)
■ Learn from failures (Q4)
■ Compete with self-imposed standards
(Q5)
■ Take unpopular decisions (Q6)
3
■ Resist impetuous or emotional behaviour
(Q7)
■ Take a balanced view of events (Q8)
■ Tolerate uncertainty (Q9)
■ Accept advice (Q10)
■ Demonstrate financial viability (Q11)
■ Demonstrate support of spouse (Q12)
■ Demonstrate enterprise background (Q13)
■ Demonstrate profit motivation (Q14)
■ Demonstrate sales orientation (Q15)
■ Demonstrate receptiveness towards
franchisor's training (Q16)
■ Demonstrate growth orientation (Q17)
■ Demonstrate a favourable attitude towards
task delegation (Q18)
■ Take the long-term view (Q19)
■ Demonstrate belief that individuals can
'make things happen' (Q20)
Interpreting Replies
The marking scheme, contained in the body of
the questionnaire and presented in square
brackets [ ], should, in practice, be separated
out if the franchisor does not wish the
prospective franchisee to be able to conduct
his/her own marking. A good score for the
exercise in its present form would be 25+ of a
possible maximum score of 40 marks. It is
worth remembering that no exercise like this
can ever be totally efficient in predicting
success. It is essential that it is used in
association with other personnel management
techniques. With that proviso, it should pay
good dividends.
International Franchise Research Centre - Special Studies Series Paper No.6
The twenty questions, along with marks in
brackets [ ] are presented overleaf. These are
'forced choice' questions where the
respondents is asked to opt for one of a
choice of 3 possibilities: (a), (b) and (c) on
each of 20 questions. This 'forced choice'
format is designed to stop people sitting on
the fence. It is quick and easy to administer,
whilst giving the franchisor leads on issues
that can be followed up in greater detail later.
If you the franchisor wish to use this exercise
essentially to inform a prospective franchisee
of whether or not they are likely to be suitable
material, you may provide them with the
marking scheme to facilitate self-assessment
and, in the process, allow them to see which
statements are regarded favourably by your in
terms of relevance to your franchise.
On the other hand, if the main reason for
running the exercise is to get information from
the prospective franchisee in as accurate a
form as possible, you the franchisor should
mark the completed questionnaire. If the
prospect does not know which statements
carry most marks, he/she is less likely to be
tempted to deliberately select the statements
attracting most marks. It is worth, in any case,
stressing the point that giving dishonest
answers in order merely to accumulate points
is a fruitless exercise from all points of view.
4
 TWENTY QUESTIONS

Q1 Are you regarded by those who know you as:

(a) Generally a fairly self-contained person ?.................................................................. [2]

(b) Generally a rather gregarious person ? ..................................................................... [0]
(c) Somewhere in between (a) and (b) ? ........................................................................ [1]

Q2 Are you regarded by those who know you as:

(a) Frequently frustrated by tasks you find boring ? ........................................................ [0]

(b) Able to endure a reasonable amount of boredom and frustration ?............................ [1]
(c) Generally good at concentrating on whatever tasks face you ? ................................. [2]

Q3 Would you say that:

(a) You possess an excess of mental and physical stamina and enjoy excellent health ? [2]
(b) You find that you tire easily if you work long hours and your health is not always of [0]
the best ? .................................................................................................................
(c) You estimate that your health and stamina are about average for a person of your [1]
age ? ........................................................................................................................

Q4 Would you say that:

(a) You find mistakes and setbacks very demoralising ?................................................. [0]
(b) You feel that mistakes can be a very useful way of learning as long as they are not [2]
repeated ? ................................................................................................................
(c) You try to learn from your mistakes but often find it easier said than done ?.............. [1]

Q5 Which of the following most accurately describes you ?

(a) You set yourself targets and almost obsessively chase after them ? ......................... [2]
(b) You get fed up if you find yourself 'on the go' all the time ? ....................................... [1]
(c) You like to take life at a modest pace and respond to pressures as and when they [0]
arrive ? .....................................................................................................................

International Franchise Research Centre - Special Studies Series Paper No.6 5

Q6 Would you say that:

(a) You find it almost impossible to make tough decisions, particularly if they involve [0]
people ?....................................................................................................................
(b) You can make tough decisions when necessary but it takes a lot out of you [1]
emotionally ? ............................................................................................................
(c) You see tough decisions as a fact of life - you don't necessarily enjoy them but, on [2]
occasions, see no alternative ? .................................................................................

Q7 Would you say that:

(a) You do not suffer fools gladly and make little effort to hide your feelings ? ................ [0]
(b) You have notable patience and self-control ? ............................................................ [2]
(c) You are situated in between positions (a) and (b) ?................................................... [1]

Q8 Would you say that:

(a) Your mood is very influenced by events ? ................................................................. [0]

(b) Your mood is very little influenced by events ? .......................................................... [1]
(c) You tend to adopt a policy of 'taking the rough with the smooth' ? ............................. [2]

Q9 Are you regarded by people who know you as:

(a) A person who needs to know exactly where they stand ?.......................................... [0]
(b) A person who can live with uncertainty ?................................................................... [2]
(c) A person who can endure a reasonable amount of uncertainty ?............................... [1]

Q10 If you go into business would you:

(a) Resent people who appear to be telling you how to run your own business ? ............ [0]
(b) Regard the views of others as a potential source of useful information and [2]
guidance ?................................................................................................................
(c) Be willing to listen to others when you had the time but likely to 'take it all with a [1]
pinch of salt' ?...........................................................................................................

Q11 Would you say that your total personal assets and savings together:

(a) Exceed the full buy-in cost of the franchise ? ............................................................ [2]
(b) Exceed two-thirds of the full buy-in cost ? ................................................................. [1]
(c) Amount to less than two-thirds of the full buy-in cost ? .............................................. [0]

International Franchise Research Centre - Special Studies Series Paper No.6 6

Q12 Do you feel that your spouse:

(a) Feels that how you earn a living is very much your own affair ?................................. [0]
(b) Would prefer to see you doing something you enjoy ?............................................... [1]
(c) Is very keen on your taking a franchise and willing to back you very strongly ?.......... [2]

Q13 Which of the following is true of you ?

(a) There is no prior history of self-employment in your family involving either yourself or [0]
close relatives ?........................................................................................................
(b) Though you have not personally been self-employed previously, there is some [1]
history of self-employment in your family via close family and/or relatives ? ..............
(c) You have personally been self-employed previously ?............................................... [2]

Q14 Is your main reason for wanting to be a franchisee:

(a) To achieve a good standard of living ? ...................................................................... [2]

(b) Because most of the alternative options for making a living appear closed ? ............. [0]
(c) For the independence and autonomy involved in having you own business ? ............ [1]

Q15 Do you feel that, in taking a franchise:

(a) You would have a tried and tested product/service which should sell itself ? ............. [0]
(b) No matter how good the product/service, customers still respond to sales effort ?..... [1]
(c) Selling would still be a key activity ?.......................................................................... [2]

Q16 Is your prior work experience:

(a) Unrelated to the franchise in question ? .................................................................... [2]

(b) Very closely related to the franchise in question ? ..................................................... [0]
(c) Marginally related to the franchise in question ? ........................................................ [1]

Q17 In running your own business, would you:

(a) Prefer to stay small ? ................................................................................................ [0]

(b) Wish to grow as big as circumstances allowed ?....................................................... [2]
(c) Just grow to a size where you could begin to take more time out of the business ? ... [1]

International Franchise Research Centre - Special Studies Series Paper No.6 7

Q18 Do you feel that:

(a) To get a job done properly, you must do it yourself ? ................................................ [0]
(b) Delegation allows you to spend more time doing what you are best at ?.................... [2]
(c) Delegation is a necessary evil ? ................................................................................ [1]

Q19 Do you feel that it usually pays to:

(a) Take a long-term view of things ? ............................................................................. [2]

(b) Make hay whilst the sun shines ?.............................................................................. [0]
(c) Adopt the medium-term view ?.................................................................................. [1]

Q20 Do you feel that

(a) Your future lies largely in your own hands ? .............................................................. [2]
(b) You can at least partly influence your own future ?.................................................... [1]
(c) The individual is merely a puppet on the end of a string and can do little to influence [0]
events ?....................................................................................................................

THE POINTS BEHIND THE QUESTIONS tasks are sometimes viewed by

To add more 'meat to the bone', what follows
here is a more detailed background on the
issue being investigated in the questions
above:
Q1 Franchisees need to be able to survive
feelings of isolation. In contrast to being
an employee, they have no immediate
boss, or peers, who can give help,
advice or moral support.
Q2 Franchisees need to be able to exercise
self-discipline. In running their own
business they will be responsible for a
wide range of tasks. Some of these will
almost certainly prove satisfying whilst
others will prove highly frustrating. The
franchisee will be responsible for
allocating his/her own time and can, at
their peril, neglect tasks such as
paperwork, financial control, invoicing
and chasing payment. Although these
franchisees as stopping them from
getting on with the 'real job' of producing
and selling, no business can survive
without them.
Q3 Franchisees will usually need to work
harder than they have even worked
before. This requires both mental and
physical stamina. In the early days of
building up a franchise, there will be little
time for leisure activities, holidays or
illness. Some advisers go as far as
recommending that anyone considering
setting up in business should consult
their doctor first.
Q4 Franchisees need to be able to learn
from failure. Disappointments are
inevitable in business and can lead to
demoralisation. A good businessman/
woman, however, must possess the
resilience to survive setbacks and learn
from them.

International Franchise Research Centre - Special Studies Series Paper No.6 8

Q5 Franchisees need to be able to compete
with self-imposed standards. When
working on your own, targets and
standards need to be set which act as
goals reinforcing motivation. If these
goals are set too low they will have little
motivating value. If they are set
unrealistically high, they will not be
achieved and a sense of failure and
demoralisation will result. Thus,
modestly ambitious, though not
unrealistic, goals need to be set and
used as markers of achievement.
Q6 Franchisees need to be able to take
unpopular decisions. It is impossible to
remain popular at all times and any
attempt to do so it likely to have costly
consequences for your business.
Q7 Franchisees must be able to resist
impetuous or emotional behaviour. It is
tempting, especially when you are your
'own boss', to exercise the associated
independence by reacting to frustration
in what might later be seen as a
whimsical manner that is not in the
longer-term interests of the business.
This may be emotionally satisfying in the
short term but should be resisted at all
costs.
Q8 Franchisees should be able to take a
balanced view of events. In business it is
easy to yield to the temptation of feelings
of euphoria or depression in response to
good or bad news. This can prove
extremely stressful and wearing. A
successful businessman/women needs
to be able at all times to take a a
balanced view of events and to set an
attitude of 'taking the rough with the
smooth'.
Q9 Franchisees, running their own outlets,
need to have a facility for surviving
uncertainly. The setting up of a new
business entity is a creative venture and
requires a facility for coping with
ambiguity. People with a low stress
tolerance may find difficulty in running
their franchise.
Q10 Franchisee must have a facility for
taking advice. Having gone into business
International Franchise Research Centre - Special Studies Series Paper No.6
with 'independence' one of their main
goals, franchisees need to avoid
maximising that independence by
resisting advice whether it be from the
franchisor or some other expert source.
Q11 Franchisees must demonstrate financial
ability. Though the clearing banks tend
to lend to would-be franchisees more
readily than to would-be conventional
small business start-ups, it needs to be
remembered that all loans have to be
repaid, with interest. A large financial
repayment overhead in the early days of
trading can impose additional pressures.
Q12 Franchisees should, ideally, be able to
demonstrate support from their spouse.
Most franchise outlets work long hours
involving domestic disruption. Anything
less than positive spouse support here
can have very negative consequences.
Q13 Franchisees should, ideally, be able to
demonstrate an enterprise background.
Despite the desire for self-employment
being quite common, only a minority
make the jump from aspiration to reality.
Those who have previous direct
experience of self-employment or,
alternatively, have a close relative self-
employed (usually a father) appear to
find the transition easier. Some evidence
exists to suggest that they may also be
more successful in terms of business
growth.
Recent analysis suggests that newer
franchisors are keen on franchisees
having prior experience of self-
employment, but franchisors with a
longer track-record are less inclined to
do so.
Q14 Franchisees should demonstrate profit
motivation. Amongst small business
people generally, profit motivation is of a
relatively lower order than other goals
such as independence and autonomy.
Profit motivation tends to promote
greater growth.
Q15 Franchisees should demonstrate sales
orientation. Despite national advertising
and promotion of brand awareness by
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 the franchisor, sales skills on the part of
the franchisee can still make a
substantial difference to levels of local
market penetration. Local advertising
and good interpersonal skills and service
at the customer interface can be crucial.
Q16 Franchisees should demonstrate
receptiveness towards the franchisor's
training. Franchisors tend towards the
view that 'starting with a clean sheet' is
the best basis for initial training rather
than competing with previous training
that a potential franchisee may already
have previously received in the field of
operation.
Q17 Franchisees should demonstrate growth
orientation. The income of the franchisor
is directly related to the growth of
franchisees. Thus, franchisees easily
satisfied with low levels of growth may
require considerable motivating.
Q18 Franchisees should demonstrate an
ability to delegate rather than attempt to
undertake all jobs themselves. Failure to
delegate will limit business growth and
lead to the franchisee spending time on
tasks that could be performed by less
key staff.
Q19 Franchisees must be capable of taking
the long-term view. In an economy
suffering endemic 'short-termism', long
term planning and goal setting is likely to
pay dividends by giving an edge over the
competition.
Q20 Franchisees should have an ability to
'make things happen'. People with an
'internal locus of control' tend to believe
they personally can influence their
environment. This belief can become a
self-fulfilling prophecy.
International Franchise Research Centre - Special Studies Series Paper No.6
CHANGES TO SUIT YOUR COMPANY
Obviously, any company using this technique
can add additional questions, drop others and
even reallocate the points on certain
questions in line with their own specific
requirements.
By way of example here, Q1 refers to the
ability of an individual to cope with feelings of
isolation. Depending upon the precise nature
of your franchise, and also the stage of its
development, this factor may be upgraded or
reduced in its importance. Also, many
franchisors express a preference for potential
franchisees coming from outside the line of
business in question. Others, however, may
see advantages in recruiting people from
similar lines of business (Q16). Further, some
companies look for franchisees who are very
ambitious and wish to grow (Q17). Others,
selling what may be called 'job franchises'
better suited to a one-person operation, may
feel that such ambition could be stifled or
counter productive.
Changing the points scheme to accommodate
such in-house preferences is a relatively
simple matter.
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AUTHOR
John Stanworth is the director of the
International Franchise Research Centre
and has been engaged in research into
franchising since the mid-1970s. He also
leads the Future of Work Research Group,
based at the University of Westminster, which
has a record of specialist research in
Teleworking, Small Business Development
and Human Resource Management. Studies
have been undertaken for many clients,
including The Department of Trade &
Industry, The Department for Education and
The Economic & Social Research Council.
International Franchise Research Centre - Special Studies Series Paper No.6
INTERNATIONAL FRANCHISE RESEARCH CENTRE
The International Franchise Research Centre
(I.F.R.C.) is committed to improving the
understanding of franchising. This is achieved
by the publication of impartial research and by
the encouragement of informed debate.
Membership is suitable for anyone with an
interest in franchising and further details are
available from the address on the rear cover.
SPECIAL STUDIES SERIES
Papers in the Special Studies Series are
supplied free of charge to I.F.R.C. members
and are published a minimum of four times a
year. They report upon a range of issues
which are felt to be of interest to the
franchising community. Subject matter
includes the findings of surveys of franchisors,
franchisees, and potential franchisees, and
also special interest matters, such as finance
for franchising.
No.1 The Blenheim/University of
Westminster Franchise Survey:
Spring 1993
No.2 Improving Small Business Survival
Rates via Franchising: The Role of the
Banks in Europe
No.3 Targetting Potential Franchisees:
Industry Sector Backgrounds and
Declared Areas of Interest
No.4 The Impact of Franchising on the
Development Prospects of Small &
Medium-sized Enterprises (SMEs) in
Europe
No.5 The Blenheim/University of
Westminster Franchise Survey: A
Comparison of UK and US Data.
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