What happens at a franchise discovery call

You've sent in an enquiry about a franchise, and soon someone will ring you. That's the discovery call. Nothing has been signed, so it can feel like a casual chat, and it's easy to go in cold.

A little preparation makes it a much better conversation for both sides. This guide covers where the call fits, what we talk about on ours at National Floors, what to have ready, which questions to ask first and what the Franchising Code says about documents and payments.

The short version. A discovery call is the first conversation between you and a franchisor. At National Floors it comes within one business day of applying and covers your goals, budget and preferred territory. Go in with your reasons, a rough budget, the towns you like and a short list of questions. There's no need to decide anything on the call: under the Franchising Code, you receive the documents first, and the agreement can't be signed until 14 days after you have them.

This is general information, not legal or financial advice.

What is a franchise discovery call?

It's the first proper conversation between you and a franchisor. The franchisor finds out about you and what you're looking for. You find out enough about the franchise to decide whether it's worth going further. Neither side is committing to anything yet.

At National Floors, we call within one business day of you applying, and the call is about your goals, your budget and your preferred territory. Applying is free, confidential and carries no obligation.

The call is the second of our five steps: apply online, discovery call, documents and territory, due diligence, then sign and launch. You may also come across the term "discovery day", so it's worth asking any franchisor what it means by each. In our process, the visit to our stores and the meeting with our leadership team come later, at due diligence.

What do you talk about on a discovery call?

On ours, there are three topics. Here's how to think about each one beforehand.

Your goals. Why a business of your own, and why flooring? Our application form offers reasons such as being your own boss, a proven system and support, or owning something in your community. Be honest about the lifestyle too. The showroom trades 9am to 5pm, Monday to Saturday, and owners should expect to be on the floor six days a week, especially in the first year. Our guide to a week in a flooring showroom shows what fills those days.

Your budget. The estimated total investment is $318,200 to $606,750 + GST, depending on your site and fit-out, with ongoing fees on top. National Floors doesn't offer financing, but you can talk to third-party lenders about funding. Business Victoria points out that on top of franchise and set-up fees you may pay ongoing fees such as advertising and marketing fees, royalties and lease fees. So work out roughly what you could put in yourself, and whether you'd want finance. Our guide to what a flooring franchise costs lists what the estimate includes and the costs that can still go above it.

Your preferred territory. Come with a first and second choice. Each franchise has a non-exclusive Local Marketing Area set in the franchise agreement, and every open town has its own page. Browse the open territories, from Geelong to Warrnambool. Business Victoria suggests checking how the agreement defines your area, whether other franchisees can compete in it and how online sales are handled.

You don't need a flooring background. If you run a business now, or come from a trade, sales or corporate background, say so.

What should you have ready before a discovery call?

Write these down first. They make the call far more useful:

Your reasons. A few sentences on why you want to own a business.
Your numbers. What you could invest yourself, whether you'd want finance, and how long your household could manage while a new business settles in.
Your timing. Our form asks when you'd like to open: within 3 months, in 4 to 12 months or in a year or more. Think about notice periods and family plans.
Your towns. A first and second choice, and why.
Your week. Can you be on the floor six days a week?
Your questions. The list below is a start.
A showroom visit. Walk into a flooring showroom as a customer, such as ours in Dandenong, Werribee or Thomastown. Notice how you're greeted and how the samples are displayed.
Your advisers. business.gov.au and Business Victoria both say to get advice from franchise lawyers and accountants. Find them now, so they're ready when the documents arrive.

It's also worth a look at the Franchise Disclosure Register. The Code requires most franchisors to have a profile on it, and business.gov.au suggests using it to compare costs and contract terms between franchises.

What should you ask on a franchise discovery call?

Save the clause-by-clause questions for when you have the documents. On a first call, you're finding out whether the franchise deserves that effort. Start with these:

Ask	Why it matters
What does the investment include, and what's extra?	Packages differ, so you need the whole picture before you compare.
What are the ongoing fees, and what is each a percentage of?	Fees on sales rise and fall with sales, so know what counts as a sale.
How is my territory drawn, and who serves online enquiries?	It decides which customers are yours.
What training and support will I get, and where?	It shapes how ready you are on opening day.
If I'm given performance figures, what are they based on?	The Code says figures given to you must also be in the disclosure document, and forecasts must come with their assumptions.
What will I get in writing, and when?	Check every answer against the documents.

Make notes, then check each answer against the disclosure document and franchise agreement when they arrive. The Code also stops a franchisor requiring you to sign a waiver of anything it told you, verbally or in writing, so it's worth asking for the important answers in writing.

Our guide to questions to ask a flooring franchisor before you sign has the full due diligence list, from territory and suppliers to installers and exit.

Should you pay or sign anything on a discovery call?

You don't need to. The call is about fit, not commitment, and the Franchising Code builds in protections for what comes next:

When	What the Code says
After you apply or show interest	The franchisor must give you the ACCC's information statement as soon as practicable, and within 7 days, before any other documents.
Before you can sign	You must receive the franchise agreement in the form it will be signed in, the disclosure document and a copy of the Code. The agreement can't be signed until 14 days after you have them.
If you make a payment in connection with the agreement during those 14 days	You can ask in writing for it back, and the franchisor must repay it within 14 days.
If money is required before the agreement	The disclosure document must say why, how it will be applied, who will hold it and when it's refundable.
Before the agreement is signed	The franchisor must have a statement about advice from an independent lawyer, business adviser and accountant: from the adviser, or from you saying you've had it or chose not to.

If the information statement hasn't arrived a week after you applied, ask for it. And remember that 14 days is a minimum, so take the time you need.

At National Floors, you'll receive the Disclosure Document, the franchise agreement, a copy of the Code, leasing information and related agreements at least 14 days before you sign, and a 14-day cooling-off period applies after you do. Our guide to the Franchising Code explains each document.

What happens after the discovery call?

At National Floors, three steps follow the call:

Documents and territory. We send the Disclosure Document, the franchise agreement, a copy of the Code and related documents, and share your area's data.
Due diligence. You visit our stores and meet the leadership team.
Sign and launch. Training, the showroom build and your grand opening.

Use the gaps between steps well. Ask an accountant and a franchise lawyer to read the documents. business.gov.au also suggests checking the franchisor's financial position and running a background check through ASIC, and Business Victoria suggests talking to existing or past franchisees. Our guide to how to buy a franchise in Australia explains what affects the timing at each stage.

When you're ready for step 1, check whether your area is open. It takes about two minutes, mostly taps.

Questions

How soon will I get a discovery call after I apply?

Within one business day of applying, according to our franchise page. The first step is a call about your goals, budget and preferred territory.

How do I prepare for a franchise discovery call?

Write down your reasons, a rough budget, your timing, a first and second choice of town and your own questions. Line up a franchise lawyer and an accountant, and look at the Franchise Disclosure Register.

Is a discovery call the same as a discovery day?

Not in our process. The discovery call is a conversation, and it comes first. The visit to our stores and the meeting with our leadership team come later, at due diligence. Other franchisors may use the terms differently, so ask what they mean.

Do I have to pay or sign anything on a discovery call?

Applying is free and carries no obligation, as our franchise page says. Under the Franchising Code, a franchisor can't sign the agreement until 14 days after giving you the documents, so there's no need to decide on the call.

Do I need to know flooring before the call?

No. Initial training before you open covers product, sales, operations and the money side. Check whether your area is open.

What happens at a franchise discovery call (and how to prepare)