There are historically two criteria for selecting successful franchisees: 

(1) financial ability, and 

(2) personal characteristics. 

Many franchisors have been able to develop their franchisee criteria list by splitting, on a 50-50% basis, the financial responsibility and the personal characteristics.

The franchisor may divide the franchisee criteria into six different areas after evaluating the financial ability.

The evaluation for the franchisee is often based upon the following six criteria:

    Experience and background

    Managerial experience

    Individual impressions

    Potential ability

    Maturity

    Ability to work with franchisor

This interview system allows the franchisor to learn more about the potential franchisee and their ability to succeed. A problem that many franchisors get into initially is to assume simply that if they have sufficient financial background they will also have the ability and personality to succeed as a franchisee. Some of the worst nightmares that franchisors experience have been from financially secure individuals who have very little desire to work as a franchisee but are rather just looking for investment opportunities which will create serious problems for the franchisor in the long run.

Selection criteria are designed to help the franchisor have a better understanding of the franchisee. These criteria should also look at the negative life experiences of prospective franchisee. Negative life experiences are part of everyone's life. These experiences, though, at times are gateways for success in the future. People have overcome stumbling stones and have risen to great heights because their ability to overcome bad experiences.

The franchisors should remember that they are looking for someone with whom they will be a "partner" or "co-owner." Franchising is a family affair. If the average marriage in America lasts for 7.8 years and your franchise agreement is for 20, then you need to realize that you are going to be very involved with this individual for a long period of time.

The franchisor needs to take the time to investigate all references and materials provided by the franchisee. These references are often critical to the proper selection of the franchisee. They may indicate problems associated with individuals seeking franchises.