Sound Franchisee Selection

​Look to any profitable business, and you’re bound to see a positive correlation between the use of psychometric assessments and success. This is largely due to these tests providing a quantifiable prediction of job performance.

Another sector which is recognising the value of psychometric assessments and the role they play in predicting success are franchise groups. Having the cash is no longer the most important prerequisite for being a business owner. Knowing the difference between entrepreneur and wantrapreneur may be the single most important factor when allowing someone to represent your brand. For instance, a potential franchisee looking to buy into a restaurant group may need to demonstrate various competencies such as proven business acumen, drive, the will to succeed, self-motivation, customer-focused orientation, enthusiasm and the capacity to be a hands-on operator. But what if they are just eloquent at talking the talk and not necessarily walking the walk?


Businesses who utilise face to face interviews as the dominant deciding factor when selecting new franchisees are putting themselves at a considerable risk. According to research conducted by Princeton psychologists Janine Willis and Alexander Todorov, it takes a tenth of a second to form an impression from a stranger. That’s a blink of an eye. Even if you don’t believe you make a judgement on someone in the split second that you meet them, on an unconscious level and according to science, you DO form a judgement call. That is why in some instances, psychometric assessments can reveal information about someone that will shock you because you will ask yourself “how did I make such a wrong judgement call?".

Franchise groups may provide adequate training, support systems and marketing platforms, but according to a recent paper published in the American Bar Association on “The Psychology of Franchising”, 40% of a franchisee’s success will come through the application of their own hard work and talents. However, it appears that the rigorous selection of franchisees appears to be the exception, rather than the rule.

When a franchisee fails, not only do they lose their own investment, the franchisor also faces significant loss. There is the direct and indirect resources required to support a failing franchise, including additional staff, travel costs, management time and professional services. But perhaps most significant is the loss of royalty revenues and the damage to the brand.

Then there is the phenomena of the “Self Serving Bias” to contend with. According to psychologists, this is the natural tendency of people to take credit for their successes and blame others for their failures. Thus failing franchisees will seek to justify their problems by attracting allies and supporters from within or outside the franchise network. Typically a great deal of energy will be vested into this. The repercussion is that this will infect the morale of franchise staff, other franchisees and even the employees of the brand. The impact of such destructive attitudes cannot be emphasised enough.

The next time you or the franchise group you represent consider recruiting an employee, selecting a shareholder, choosing a business partner or picking your franchisee, consider utilising a scientific means to give you the highest probability for success.