How to research a franchise before you buy
Good research turns a persuasive sales pitch into a decision you can defend. Here is how to dig, in the right order, before you commit a dollar.
How do you research a franchise?
Start free and public
- Check the Franchise Disclosure Register (franchisedisclosure.gov.au) for the system's key facts and register status.
- Compare cost and fee ranges against independent benchmarks, not just the brand's headline number.
- Read the franchisor's own materials, then look for independent coverage and franchisee experiences.
Read the disclosure document
Once you are a prospective franchisee, you must receive the disclosure document at least 14 days before signing. Read it in full, twice. Pay special attention to costs and fees, the franchisor's solvency and financials, supply restrictions and rebates, and the lists of current and, crucially, former franchisees. See our guide on the disclosure document for what each section means.
Talk to franchisees and model the numbers
- Call at least three current and two former franchisees from the disclosure list, the ones who left tell you the most.
- Ask what it really cost, how long to profitability, and what they wish they had known.
- Build a conservative, stress-tested cash-flow forecast with an accountant.
- Have a franchise lawyer review the agreement alongside the disclosure document.
- How to use the Franchise Disclosure Register before you buy10 min
- 40 questions to ask a franchisor before you buy9 min
- What is a franchise broker (and should you use one)?6 min
- What is a franchise discovery day?6 min
- How to choose a location for your franchise8 min
- Common mistakes first-time franchise buyers make7 min
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Frequently asked questions
Where do I start researching a franchise?
Start free and public: the Franchise Disclosure Register, independent cost benchmarks and franchisee experiences. Then get the disclosure document, talk to franchisees, and model the numbers before signing.
How long should I spend researching a franchise?
Use at least the mandatory 14-day disclosure period, and often longer. That window exists precisely so you can read the documents, take advice and speak to franchisees before you commit.
Who should I talk to before buying a franchise?
Current and former franchisees (from the disclosure document's list), an accountant to model the numbers, and a franchise lawyer to review the agreement. Former franchisees give the most candid picture.
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