Finding the right candidate to purchase your franchise can be difficult. Not everyone who wants to buy a franchise is qualified for it. In fact, Franchise Direct found that 41% of people who want to run a franchise have never operated their own business. Besides, the wrong candidate can risk your franchise investment and reputation. So, how can you keep your franchise safe?
Running a background check on potential franchise owners is a great way to ensure your franchise is safe. Choosing the right background checks can confirm that franchisees are safe to work with and financially responsible. It can also verify that they have the required experience to run a successful business.
In this article, you’ll learn:
If you put a franchise in the wrong hands, you could end up wasting your time, money, and effort. In a new franchise system, the wrong candidate could cost you up to $150,000! A background check can show the candidate’s history of crime or financial trouble that might affect your franchise’s future profits.
Along with protecting your resources, your franchise’s good reputation should be a top concern. Without a background check, you could find your franchise’s reputation at the mercy of a bad apple. Using background checks ensures that the people representing your business will help your franchise’s reputation, not hurt it.
Consider, too, the human component of your franchise. If a franchisee with a history of violent crime injures an employee or customer, who will people blame? As the franchisor, you could be liable for putting that candidate in a position to hurt others—something that could cost you your reputation and a lot of legal fees.
With all these potential pitfalls, it’s clear that franchisors need to run background checks on franchise candidates. But, will just any background check be enough to protect your business?
A variety of background checks are available to franchisors. Depending on your business, you may need specific background checks suited to your industry. Here are the most important background checks and how they’ll help you.
Learning which background checks to use is only the first part of the process. Now you need to run these background checks while staying legally compliant. How can you do that?
Now that you know which background checks to run, you need to know how to run a background check. Multiple state and federal laws regulate background checks. So, make sure your background checks follow all legal requirements.
Here’s a list of ways you can run a background check legally.
At Trusted Employees, we offer background checks that can be customized for your franchise. Our background checks are also in compliance with federal and state laws. Contact us today to learn more about our background check packages.