What do you think about food franchises?
Is it a good investing? Is it slow? I’ve heard there are food franchises such as Subway that start at $78,000. Please tell me how this business work and if it’s something you would recommend to a person who is starting in business.
Most fast food franchises are reporting growth and continue to be extremely successful, despite the economy. Drive around your local business district on a Friday or Saturday evening and you’ll notice that parking lots are always nearly full. The fast food industry continues to move full-steam ahead. The industry’s annual sales have nearly tripled over the last 15 years, easily surpassing the $200 billion mark in 2006.
Although they may need to postpone that trip to Disneyworld or buying that new inground pool during tough times, consumers actually are more inclined to splurge on convenience, especially meals, particularly when both mom and dad are working full time jobs. Time starved families have little time to prepare food at home, nor do they feel like it, after working all day and fighting rush hour traffic.
Fast casual restaurants continue to be fueled by the consumer’s ever increasing need for convenience. More than half of the adult population claim they are simply too busy, and convenience is a critical part of their lives that they are more than willing to pay for.
Why a franchise rather than an independent restaurant, you may ask? Respected, well known brand names instantly draw customers in to your business. They know and expect the same outstanding quality food when they visit a Burger King, whether their dining in Portland, Maine or Portland, Oregon.
Franchises offering "comfort foods" are thriving particularly well and their ability to be resilient despite the current economic downturn is very encouraging to potential franchisees. After all, however bad the economic news, consumers still want their favorite fries or take-out pizza. Although they are more likely to be trimming on the prime rib dinners, those small luxuries of life are that much more significant. The criteria for selecting a restaurant continue to be quality cuisine, a well known established brand or name, and, of course, price.
Co-branded franchises are increasingly popular these days. Taco Bell and Pizza Hut have been known to share the same building, giving the franchisee a wider, more diverse customer base, while increasing profitability simultaneously.
With the trend toward healthier lifestyles, the fast casual healthy concept has been able to thrive as well, despite the downturn. Consumers are becoming increasingly concerned about the food they are eating. More and more, you are seeing the greasy burger joints now venturing into fresh salads, fruit, and vegetarian plates to accommodate those health conscious consumers. Again, this provides for a larger share of the market that may otherwise have been missed.
Of course, there are some drawbacks that go along with owning a restaurant, or fast food franchise. Labor can be a challenge and turnover rates are higher than in other industries. Although the initial investment is higher than other business models, banks and lending institutions tend to be more apt to approve business loans, particularly because of the higher revenue that is generated compared to other business models.
While you may initially question the decision to become a fast food franchisee, keep in mind that consumers, and their love affair with fast food, is here to stay. In fact, in strained economic times, people are inclined to buy that egg muffin or hot dog as a “comfort food” even more. You’ll receive solid support and training from the franchisor, not to mention the prestige of owning a popular fast food restaurant franchise.
The franchise cost is the smallest cost.
It takes years to pay back the loan for the building.
After you have no mortgage – is when it starts becoming profitable.
Guessing you could pull 50 grand a year with a lot of hard work.
Keep doing your research – keep asking here – someone will know.
There are like a billion subways – someone is bound to know.
/
References :
ABOUT SUBWAY
Founded: 1965 Franchising since: 1974
In 1965, 17-year-old Fred DeLuca and family friend Peter Buck opened Pete’s Super Submarines in Bridgeport, Connecticut. With a loan from Buck for only $1,000, DeLuca hoped the tiny sandwich shop would earn enough to put him through college. After struggling through the first few years, the founders changed the company’s name to Subway and began franchising in 1974. Offering a fresh, healthy alternative to fast-food restaurants, Subway has franchises throughout the United States and in several countries, with locations in traditional and nontraditional sites alike.
Address:
325 Bic Dr.
Milford, Connecticut 06460
Phone:
(800)888-4848/ (203)877-4281
Franchisee Association
North American Association of Subway Franchisees
Total investment: $84,300 – $258,300
Franchise fee: $15,000
Ongoing royalty fee: 8%
Term of agreement: 20 years, renewable
Training
Available at headquarters: 2 weeks
Training available in Australia, China, Germany, India, Montreal, Canada & Miami, FL
Ongoing Support
Newsletter
Meetings
Toll-free phone line
Grand opening
Internet
Security/safety procedures
Field operations/evaluations
Purchasing cooperatives
Marketing Support
Co-op advertising
Ad slicks
National media
Regional advertising
Other marketing support
Local store marketing
References :
Most fast food franchises are reporting growth and continue to be extremely successful, despite the economy. Drive around your local business district on a Friday or Saturday evening and you’ll notice that parking lots are always nearly full. The fast food industry continues to move full-steam ahead. The industry’s annual sales have nearly tripled over the last 15 years, easily surpassing the $200 billion mark in 2006.
Although they may need to postpone that trip to Disneyworld or buying that new inground pool during tough times, consumers actually are more inclined to splurge on convenience, especially meals, particularly when both mom and dad are working full time jobs. Time starved families have little time to prepare food at home, nor do they feel like it, after working all day and fighting rush hour traffic.
Fast casual restaurants continue to be fueled by the consumer’s ever increasing need for convenience. More than half of the adult population claim they are simply too busy, and convenience is a critical part of their lives that they are more than willing to pay for.
Why a franchise rather than an independent restaurant, you may ask? Respected, well known brand names instantly draw customers in to your business. They know and expect the same outstanding quality food when they visit a Burger King, whether their dining in Portland, Maine or Portland, Oregon.
Franchises offering "comfort foods" are thriving particularly well and their ability to be resilient despite the current economic downturn is very encouraging to potential franchisees. After all, however bad the economic news, consumers still want their favorite fries or take-out pizza. Although they are more likely to be trimming on the prime rib dinners, those small luxuries of life are that much more significant. The criteria for selecting a restaurant continue to be quality cuisine, a well known established brand or name, and, of course, price.
Co-branded franchises are increasingly popular these days. Taco Bell and Pizza Hut have been known to share the same building, giving the franchisee a wider, more diverse customer base, while increasing profitability simultaneously.
With the trend toward healthier lifestyles, the fast casual healthy concept has been able to thrive as well, despite the downturn. Consumers are becoming increasingly concerned about the food they are eating. More and more, you are seeing the greasy burger joints now venturing into fresh salads, fruit, and vegetarian plates to accommodate those health conscious consumers. Again, this provides for a larger share of the market that may otherwise have been missed.
Of course, there are some drawbacks that go along with owning a restaurant, or fast food franchise. Labor can be a challenge and turnover rates are higher than in other industries. Although the initial investment is higher than other business models, banks and lending institutions tend to be more apt to approve business loans, particularly because of the higher revenue that is generated compared to other business models.
While you may initially question the decision to become a fast food franchisee, keep in mind that consumers, and their love affair with fast food, is here to stay. In fact, in strained economic times, people are inclined to buy that egg muffin or hot dog as a “comfort food” even more. You’ll receive solid support and training from the franchisor, not to mention the prestige of owning a popular fast food restaurant franchise.
References :
Me. I’m a recruiter for the franchise industry with several years experience helping franchise seekers identify and attain their ideal franchise at no cost to them.