I worked in a 7-11 for several years in High school and college. My boss offered to sell me his. I declined after seeing how much he worked for what he was making and being on call 24/7.

Sounds like buying a job to to me

I think this one looks cool and fun:

Geese Police

You have to buy their dogs though.

I looked into franchising years back and the main thing that I didn't like was that I still wasn't the boss of ME. You had to buy all your supplies from the mother ship and they told you what you could and couldn't do. They get a piece of all the action(sales).

^ Absolutely. They will (often) dictate suppliers, national ad campaigns that you have little say in yet are required to help pay for (IIRC, we contributed 2% for national advertising), and so on. Now, if they have their shit together and aren't trying to jerk you around, it can work in your favor, but in reality it's all over the board. Be thorough, very, very thorough in your research. I'd contact other franchise owners and ask a bunch of questions, outside of the regular discovery process and engagement with the parent company, to get the unfiltered truth from disinterested parties in addition to the glossy materials and pitch.

quote:

Originally posted by LS1 GTO:
Girl I work with is part owner of a 7/11 (her, a brother, and two cousins).

The cousins work there to ensure the store is run to the owners' expectations.

A hunting buddy owns three Sonics - same thing for him, he works at each of them for the same reason (until he knows the manager(s) will/can do it).

Throughout most of my life growing up, my grandmother, my father, his siblings, several cousins, and I, worked for the family business. My father and his siblings worked a *ton*.

I have done it all, from the lowest assistant cook to a manager, as has most of my extended family, and I cleaned the parking lots and mowed the grass before I could legally work.

The OP didn't mention what type of franchise, but I can tell you definitively that restaurants in particular are most often an enormous time-suck for the owner(s), employee turnover is often high, the quality of the potential employee pool is often low, the ways in which waste can eat into your profits are nearly limitless, and so on.

Plus. I've tended bar and been a server in fancy/er restaurants, bars, and DJ'd in nightclubs for years, and have met and known seemingly countless restaurateurs and bar/club owners, and if you're thinking about any of these (or most retail businesses) - you better *love* it, because you'll be living it, at least most (90%+) of the time, because the likelihood that you'll have competent and honest managers and staff (or partners) for more than brief periods or rare circumstances is itself pretty rare.

We shared a big hunting lease with a dozen or so other franchise owners for many years, too, from all over the country, and most have the same story, same woes, etc, which also holds true for all of the chefs I know (I'm just into food and love cooking, have several friends in the business, etc) and it's the same there too. They do it because they love it, but they work a ton, or get fucked over, etc. We had long time employees steal thousands, too, after all - you're only getting so much quality at those wages, even manager wages...

The exceptions, or partial exceptions, seem to be the franchises that are hot shit at the moment, like Chick Fil A is these days. It hasn't always been the case, BTW. We had Chick Fil As near me for most of my life, and for 20-30yrs no one hardly gave a shit, they certainly weren't raking in the cash, but in more recent years they're doing great. Same with Subway... when new (in my area, 20+ years ago), they were killing it, busy as hell, and the dude we know that has some was raking it in for a few years, then it stabilized to averagely busy, and then the common problems/axioms come into play, he started having to work a ton, dumped all but the most prime locations, then eventually sold them all, as did my family - we got out of the business years ago, after 30+ years.

Also, lastly, one poster above (Gustofer I think) mentioned something about the parent company requiring traffic and marketing data equal to xyz, and that's almost always the case, but the kicker is... such data/intelligence is (a) a bit fuzzy and full of guesses, (b) neither easy nor inexpensive to acquire quality versions of, (c) something that can fuck you over hard-core if inaccurate or half-assed, and (d) kind of *everything* at the same time... Do not take this step for granted. I've seen it have catastrophic consequences.

Good luck. I'm sure they are plenty of success stories. Ours was successful, too, but a PITA.

The money to be made in franchising is mostly made by the franchisor and not the franchisee.

This message has been edited. Last edited by: mikeyspizza,

quote:

Originally posted by mikeyspizza:
The money to be made in franchising is mostly made by the franchisee.

Exactly, most franchise owners just make a living and it usually doesn't pay a whole lot per hour for the amount of money you invested, but there sure are a lot of hours for the franchise owner!

In my commercial banking career I financed a few. Go talk to a seasoned commercial banker and get his/her input on what's generally required.

Are you prepared to make a substantial cash contribution?

Talk to you banker.

Mike

quote:

Originally posted by mikeyspizza:
The money to be made in franchising is mostly made by the franchisee.

Quelle? You mean franchiser, right?

Pizza Ranch has opened many restaurants in Wisconsin in the past couple of years. They look like they do pretty well.

I also think you're short, possibly by a factor of 3

I own a business (a medical practice) and am hoping to move to a new 6k square foot space in the next year. The owner of the structure I will move into is willing to contribute a significant amount for buildout ($50/sqfoot) and with that contribution I am hoping to only need to borrow $500k to finish buildout. Now, I live in an expensive area, but I also only need rooms essentially built...all the specialized equipment (autoclaves, vaccine fridges, exam tables, etc) I already own

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Originally posted by jimmy123x:

quote:

Originally posted by a1abdj:

quote:

Not 100% sure if there's more to it, but it's $10k, for the franchise fee.

Probably, actually one of the cheapest.

How much do you think it costs to build one of the buildings they are housed in?

For the building and all of the equipment, I would guess $300-400k not including the land.

Chick-Fil-A has a very different franchise model.

Much lower up-front - they build, then rent it back to you for a percentage. They EXPECT the owner to be very involved in the day-to-day business.

https://www.franchisehelp.com/franchises/chick-fil-a/

quote:

Originally posted by P250UA5:

quote:

Originally posted by a1abdj:

quote:

Not 100% sure if there's more to it, but it's $10k, for the franchise fee.

Probably, actually one of the cheapest.

How much do you think it costs to build one of the buildings they are housed in?

It's used to be $5k

quote:

Chick-fil-A has a distinct franchise business model. The franchise fee to join Chick-fil-A is a very accessible $5,000. Chick-fil-A corporation will pay for land, construction and equipment for a restaurant, then rent it to the franchisee for 15% of sales plus 50% of pretax profit remaining.

Not sure how much of that is still accurate.

It definitely was recently. And they average about $3,000,000 per store. But it has to be our primary endeavor.

quote:

Originally posted by Dallas239:
It definitely was recently. And they average about $3,000,000 per store. But it has to be our primary endeavor.

It has always been that way, although as noted, the initial fee is up to $10K. This model wouldn't work if the Cathy family/BOD ever gave up the extremely tight control & vetting of new owner/operator applicants.

Another thing that has changed over the years is that it used to be VERY difficult to get approved for multiple locations. Due to the nature of the owner/operator model (CFA is 100% a hands-on business), you have to demonstrate a very high success rate over a period of time (several years) with your first location before you'll even be considered for a second, and you'll need to have a very careful game plan for exactly how you (not your managers, but YOU) plan to run both stores simultaneously. Based on the number of multi-unit owner/operators in my immediate vicinity, I'd say that's been modified or relaxed a little bit, but I still expect that corporate requires the individual units to run separate P&L statements.

-Rob (7-year CFA employee)

Look into an ANYTIME FITNESS location that is already in business. I have seen them sale from 30K up franchise transfer fee is under 5K and monthly its only like $500.

I know someone who franchised a jimmy johns. It was about 460k. The loan was collateralized and hedged against life insurance as well. Gonna be expensive. Whatever you do stay out of retail.

quote:

Originally posted by bcereuss:

quote:

Originally posted by mikeyspizza:
The money to be made in franchising is mostly made by the franchisee.

Quelle? You mean franchiser, right?

Right, oops, fixed, thanks!

For a part time investment, maybe look into Redbox or one of those water filtration kiosks. I don't know anything about them, but I have been thinking of doing some research into things I can do for $ while not at sea.

For a couple of grand you can start up a windshield crack repair business. Buy a pro kit, set up a web site, get on craigslist and in the yellow pages.

Several years ago a stone hit my rental car windshield while visiting mom in Florida. I did not buy their insurance, and they would obviously see the damage. I had no internet but found a guy in the yellow pages.

He rolled up in a small hatchback car. He spent about 45 minutes working on it and when he was done it was gone. I think he charged $75.

You just have to be willing to roll when someone calls.

I do and have not personally owned any franchise, but a good buddy of mine has owned up to 4 at once.
He says never again. The amount of work vs payoff is not there. He is in the food industry and has been for all his life.

If you have capitol and are looking to invest in a private business that would be a smarter move, but again a lot of variables. If your looking for a different type of investment check in to commercial real estate.

Cheers~

Retail isn't easy. You have to be there.