“When you buy a franchise, you may be able to sell goods and services that have instant name recognition and get training and support that can help you succeed. But purchasing a franchise is like any other investment: There’s no guarantee of success.” — Federal Trade Commission

There are two main participants in a franchise — not counting your sources of funding or financing. There’s the franchisee. That’s you. And the franchisor. That’s the company that overlays franchise operations.

As a franchisee, you pay a franchise fee and reap certain benefits from the franchisor, including:

A formula for setting up and running the franchise.

The right to use the franchisor’s name.

Assistance with establishing and growing your franchise. Assistance could include help in finding — or dictating — the location of your franchise, training in franchise establishment and operations, operating manuals or other guidance and general business and personnel advice. You also could gain access to conferences, online information, seminars, workshops and more.

Generally, ownership of a franchise includes known or defined costs, sometimes onerous franchisor controls and contractual obligations or performance requirements.

By using the franchisor’s name and expertise, you will incur a variety of costs. Some of these costs include:

Initial franchise fee, which could be non-refundable and run from tens of thousands of dollars to hundreds of thousands of dollars.

Renting or building and equipping your facility.

Purchasing inventory.

Hiring and training employees, including providing benefits in many cases.

Operating licenses.

Liability and other business insurance.

Promotional fees to the franchisor.

Royalties to the franchisor — often a percentage of gross income.

Advertising fees.

Consider also such franchisor controls as:

Approval of your location, building design and other items.

Limitations on the products or services you offer.

Operational requirements, including hours, employee uniforms, advertising standards, specials or promotions and suppliers.

Sales territory.

The franchise contract often limits the right to use the franchisor’s name for a set number of years. Even if you comply with all the terms of the contract, the franchisor might not be obligated to renew your franchisee contract.

Before you decide to invest in a franchise, ask yourself some hard questions:

Do I have a viable business plan that aligns with the franchisor’s contract and requirements?

Can I afford the startup and initial operating costs of the franchise?

Can I obtain financing if I need to?

How much money can I afford to lose? Not all franchisees succeed, even with assistance and training.

Should I have partners in the franchise?

What will I use for living expenses while opening and bringing my franchise to profitability?

Do I have the right skills and background?

Why do I want to own a franchise rather than start or acquire my own business?

Am I willing to work 50, 60, 70 or even 80 hours a week to get my franchise off to a solid start?

Before jumping in, find and visit other franchisees. They should include people who own the franchise you’re interested in as well as others with franchises in different specialties. Visit a number of franchises and franchisees  to assess the overall climate for success.

A number of franchise expos are offered around the country. Visit visit several of these expos and talk with the franchisors of franchises that interest you. Go armed with a lists of questions, including:

How many franchised outlets are there? Where are they located?

What is the initial franchise fee? What are the additional startup costs?

Are there continuing royalty payments? How much are they?

What management, technical and other support does the franchisor offer?

What controls does the franchisor impose?

How long has the franchisor been in business?

Before making what could be a life-changing decision, talk to lots of people: other franchisees, but also bankers and other lenders, economic development experts and marketing specialists.