If you’re trying to figure out how to sell franchises, you’re not alone. Franchise development is one of the most misunderstood parts of franchising. Many new franchisors believe success comes from simply generating leads, but selling franchises requires structure, discipline, and a clear understanding of who you should — and shouldn’t — bring into your system.
This guide breaks down the complete process for how to sell franchises effectively, ethically, and with long-term success in mind. Whether you’re a new franchisor, a new franchise sales professional, or an emerging brand looking to strengthen your process, this step-by-step blueprint will help you build a recruiting system that works.
1. Know Exactly Who You Want as a Franchisee
The most important part of selling franchises isn’t the pitch — it’s the person sitting across from you. Before you think about generating leads or giving presentations, define your ideal owner profile.
Key Traits to Evaluate
When deciding whether someone is a good fit, consider their:
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Background and experience
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Management ability
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Comfort level with sales
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Ability to follow systems
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Financial readiness
- Do you like them!
Most banks require 20–30% down. So if your franchise investment is around $200,000, a typical buyer needs $40,000–$60,000 in liquid capital to qualify for funding.
If they don’t meet minimum financial thresholds, they will struggle, and your brand will suffer with them.
2. Handling Criminal Backgrounds: Recency, Decency & Frequency
You will encounter prospects with some form of criminal history. The question becomes: How bad is too bad?
Use the simple, fair, and effective framework:
Recency
How long ago was the offense?
A minor infraction 20 years ago likely has no bearing on who they are today.
Decency
Was the nature of the offense something you feel comfortable overlooking?
Certain crimes — regardless of age — may be incompatible with your brand values.
Frequency
Was it a one-time mistake or a pattern of behavior?
A pattern is a red flag.
At the end of the day, rely on a gut check. Early franchisees become the face and culture of your system. Choose carefully.
3. Stop “Selling” — Start Running a Mutual Evaluation Process
The biggest mistake emerging franchisors make is calling the process “sales.”
You are not selling.
You are awarding territories to qualified owners.
The best franchise development systems call the process:
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Mutual Evaluation Process
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Franchise Recruitment Process
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Franchise Development Process
This wording immediately lowers buyer defensiveness and builds trust. It also shifts the dynamic: your goal isn’t to convince them — your goal is to decide if they’re the right fit.
If you have to beg or persuade someone, they aren’t your people.
4. The Step-By-Step Franchise Sales Process (Mutual Evaluation)
Below is a clean flow that works exceptionally well for emerging brands, especially those without large numbers of franchisees for validation.
Step 1: Initial Brand Overview (45 Minutes)
This is your introduction. Topics should include:
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Mission and values
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Senior leadership team
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Company history
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Market landscape and competitive environment
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Business model overview
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A “day in the life” of an owner
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A tease of financial performance (not the full discussion yet)
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Your goal here is alignment, not closing.
If you both feel it could be a fit, move to step two.
Step 2: Request for Consideration (RFC) Form
Before you discuss financials in depth, require the prospect to complete an RFC form.
If they don’t fill it out?
They aren’t serious.
And if they’re not willing to complete basic required paperwork now, imagine what onboarding will look like.
“No form, no unit economics call” is a simple standard that saves enormous time.
Step 3: Unit Economics Discussion (Financial Review)
Once the RFC is complete, a Unit Economics review is a review of the financials listed in the FDD. Sections to focus on would be the financially related sections:
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Item 6 – fees
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Item 7 – all in investment
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Item 19 – financial representations
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Suggestion: Pull up the FDD on a webinar in real time and only discuss numbers in the FDD.
Any other financial details NOT listed in the FDD is off limits!
This keeps you 100% compliant and prevents accidental earnings claims — which is a felony if numbers outside the FDD are mentioned!
Step 4: Meet the Senior Team Phone/Webinar
If the prospect has completed the earlier steps and still appears qualified, introduce them to your leadership team.
This step reinforces culture and alignment. You want your senior team’s buy-in before moving forward.
Step 5: Validation With Existing Franchisees
Validation is powerful, even if you only have a small number of owners.
Before the call, reach out to your franchisees:
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Give them background on the prospect
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Ask for their honest impressions
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Ask them to share their real experience
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When franchisees feel included in the decision-making process, their engagement increases dramatically.
Step 6: Discovery Day (In-Person Meeting)
By the time a prospect gets to Discovery Day, they should already be 80% committed.
Two schools of thought exist:
Option A: Signing Day
Some brands push for in-person signing.
This can work, but it raises the pressure and lowers attendance.
Option B: Learning Day (Recommended)
Discovery Day becomes the final confirmation step, not a closing event.
They come without a checkbook, meet the team, and see operations firsthand.
Close rates remain strong — and people who aren’t a fit naturally filter themselves out.
Step 7: Final Decision Day (Within 3–5 Days)
Do not allow “I need more time” or my favorite “Let me think it over” to drag on.
There is no remaining due diligence after Discovery Day.
They either do it — or they don’t.
Set a clear Decision Day.
5. What Happens After They Say Yes?
Once they commit, the real work begins. The steps after someone says YES will be different depending on how they are planning on obtaining their funding. If they are needing a bank to find the project, such as an SBA loan, the following order of steps need to be followed. Might seem backwards, but banks will expect the following before you can send a loan application for a commercial/SBA funded loan.
1. Send Franchise Agreement via DocuSign
Once signed and paid, they officially become a franchisee. Banks will absolutely require this prior to submitting the application.
2. Begin Real Estate Search (If Applicable)
But only after they sign.
If they try to pursue real estate before signing:
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Landlords won’t take them seriously
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They appear “wishy-washy”
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They risk getting blacklisted from desirable locations
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Once they are a franchisee, you can help them position the brand as the 800-lb gorilla, flipping landlord perception.
3. LOI Signed → Submit to Lenders
Banks typically won’t consider applications unless:
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Franchise agreement is fully executed
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A signed LOI is in place
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Only then can the loan package be submitted.
4. Funding (30–90 Days)
To help buyers navigate funding, many franchisors use what we call Loan Packagers. Some examples of :
They help buyers determine the best funding structure and package the loan for maximum lender appeal.
6. Schedule Training and Prepare for Grand Opening
After financing approval, the onboarding and launch process begins. This part is where great franchisors shine — and where the seeds of long-term success are planted.
Final Thoughts: How to Sell Franchises the Right Way
If you truly want to know how to sell franchises, remember this:
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Don’t chase.
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Don’t persuade.
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Don’t let “bad fits” slide through.
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Award franchises only to people who strengthen your brand, not weaken it.
The franchisees you choose today become the culture you live with tomorrow.
Need Help Selling Franchises?
If you’d like to brainstorm your franchise development process — or build one from scratch — FranLift offers two options:
1. Franchise Sales Training
Perfect for brands that want their internal team to run the process outlined above.
2. Full Outsourced Franchise Sales Organization (FSO)
If you prefer to focus on operations and let experts run development, FranLift can serve as your outsourced sales team.
Either way, you don’t need to navigate this alone.
