UK franchising: legal and commercial due diligence checklist for prospective franchisors

Published by a LexisNexis Commercial expert

Checklists

This checklist sets out various considerations and questions for a potential franchisor when weighing up the adoption of a franchise business model.

Initial considerations

Is the business model franchisable? Certain models may not lend themselves to franchising; for example, a business with low margins, where customer custom is founded on allegiance to a particular individual, or where the model is restricted to a very specific locality indeed.
Who are the main competitors in the market and what market share do they hold? A franchisor will need to assess the barriers to entry into the market, as well as the cost of acquiring a market share in that market.
Who is the ideal customer for the product or service? As the franchise model lets businesses scale quickly, the franchisor must be sure that this ideal customer can be identified in many different and varied locations.
Has a SWOT analysis been completed? SWOT is the acronym for a strategic planning method used to evaluate the strengths, weaknesses, opportunities and threats associated with a particular project.
Has a PESTLE analysis been carried out? PESTLE is a method of analysis used as an aid to strategic decision-making and is an acronym of political, economic,

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Web page updated on 26/05/2026

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