"HORN IN" On Franchise / Business Ownership -June '18 Edition

[OrangeLarry]

 

 

“HORN IN" On Franchise / Business Ownership

a monthly post with blurbs, links, and other words-of-wisdom

regarding self-employment; career transition;

and franchise / business ownership;

as well as information for business owners

who may be interested in franchising their business.

  

June 2018

 

Franchise Opportunity Knocks

Self-employment Beckons

Start answering the call right here.

News you can use to help you find

The right franchise / business opportunity for you.

 

 

What’s So Great About a Franchise?

In the course of my business, I am often asked “When I buy a franchise, what do I get for my money?” The short answer is “a business model.” Abusiness model is a framework for creating economic value, in other words, it’s a system for making money.

Many first time entrepreneurs confuse the investment in a franchise as a purchase of physical property, when what a franchise represents is intellectual property. The capital equipment, inventory, furnishings, fixtures or the cost of building out the location is part of any business be it franchised or not. The real value in a franchise is that you get a fully formed, proven business model. An effective business model is the difference between success and failure in a business.

The old maxim that most businesses fail because they are under-capitalized needs more adequate explanation. Most of these businesses wouldn’t have been considered under-capitalized if they would have had an adequate business plan. Every year thousands of well capitalized startups with brilliant ideas for a product or service fail. This not for lack of money, it is because they eventually burn up all of their cash while trying to develop a system for delivering their product into the hands of a paying customer. All business models are initially perfected by trial and error – this is a very costly process that most small businesses cannot afford to live through.  That is why so many private startups fail where franchises succeed. The franchise concept has already been refined through the process of trial and error.

The costs associated with perfecting a business model will almost always eclipse the cost of paying a franchise fee. The average franchise fee is about $38,000. . Most start-ups waste more than that in advertising costs alone while they experiment with different marketing strategies. The advantages of having the learning and cost curves reduced to a fraction of the “learn as you go” method, are very significant to say the least.

The other cost component of a franchise is the royalty. This is a fee paid for on-going support which of course includes continuous improvement of the business model, access to vendor discounts, product R&D, marketing and advertising programs, etc. Typical support royalties are between 6% and 8% of revenue. This fee usually pays for itself due to the savings realized when the franchisee purchases goods and services for the business at below market, national account rates. Additionally, most franchisees will experience much higher sales than they would as a private company – greatly in excess of 8% higher - because of the franchisor’s well designed marketing strategy.

A franchise may not be right for everyone and they are certainly not all created equal, but a good business model can lower the risk factor and accelerate one’s potential for long term success. As always, the key is finding the right match / alignment between the attributes of the franchise model and the goals, objectives, interests, life-style needs of the owner-operator.

 

“If you don't like the road you're walking, start paving another one”.

                                              -Dolly Parton

  

Advantages of a Franchise

Lower Risks. Most business experts agree that a franchise operation has a lower risk of failure than an independent business. The statistics on this vary depending on the definition of failure. Whatever statistics are used, they consistently suggest that a franchise is more likely to succeed than are independent businesses.

Established product or service. A franchisor offers a product or service that has sold successfully. An independent business is based on both an untried idea and operation. Three factors will help you predict the potential success of a franchise. The first is the number of franchises that are in operation. The second predictor is how long the franchisor and its franchisees have been in operation. A third factor is the number of franchises that have failed, including those bought back by the franchisor.

Experience of franchisor. The experience of the franchisor's management team increases the potential for success. This experience is often conveyed through formal instruction and on-the-job training.

Group purchasing power. It is often possible to obtain lower-cost goods and supplies through the franchisor. Lower costs result from the group purchasing power of all franchises. To protect this benefit, most franchise agreements restrict the franchisee from purchasing goods and supplies through other sources.

Name recognition. Established franchisors can offer national or regional name recognition. This may not be true with a new franchisor. However, a benefit of starting with a new franchisor is the potential to grow as its business and name recognition grow.

Efficiency in operation. Franchisors discover operating and management efficiencies that benefit new franchisees. Operational standards set in place by the franchisor also control quality and uniformity among franchisees.

Management assistance. A franchisor provides management assistance to a franchisee. This includes accounting procedures, personnel management, facility management, etc. An individual with experience in these areas may not be familiar with how to apply them in a new business. The franchisor helps a franchisee overcome this lack of experience.

Business plan. Most franchisors help franchisees develop a business plan. Many elements of the plan are standard operating procedures established by the franchisor. Other parts of the plan are customized to the needs of the franchisee.

Start-up assistance. The most difficult aspect of a new business is its start-up. Few experienced managers know about how to set up a new business because they only do it a few times. However, a franchisor has a great deal of experience accumulated from helping its franchisees with start-up. This experience will help reduce mistakes that are costly in both money and time.

Marketing assistance. A franchisor typically offers several marketing advantages. The franchisor can prepare and pay for the development of professional advertising campaigns. Regional or national marketing done by the franchisor benefits all franchisees. In addition, the franchisor can provide advice about how to develop effective marketing programs for a local area. This benefit usually has a cost because many franchisors require franchisees to contribute a percentage of their gross income to a co-operative marketing fund.

Assistance in financing. It is possible to receive assistance in financing a new franchise through the franchisor. A franchisor will often make arrangements with a lending institution to lend money to a franchisee. Lending institutions find that such arrangements can be quite profitable and relatively safe because of the high success rate of franchise operations. The franchisee must still accept personal responsibility for the loan, but the franchisor's involvement usually increases the likelihood that a loan will be approved.

Proven system of operation. An attractive feature of most franchises is that they have a proven system of operation. This system has been developed and refined by the franchisor. A franchisor with many franchisees will typically have a highly refined system based on the entire experience of all these operations.

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ENTREPRENEURSHIP

Is Living A Few Years Of Your

Life Like Most People Won’t,

So That You Can Spend The

Rest Of Your Life Like

Most People Can’t.

                  -Unknown

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Quick-serve Snack Food Concept

A quick-serve snack food restaurant serving specialty, gourmet French fries with over 20 different seasonings, sauces and toppings; and fountain drinks, bottled water and home-made milkshakes for beverages.

Our Menu offers three options to achieve simplicity and creativity: a Specialty Menu of ‘go-to’ topped fry baskets that promote popular national and local dishes; a Finger Food Favorites Menu comprised of classic fried appetizer-style dishes-Original Pizza Logs; Buffalo Crunch Rolls; Crispy Chicken Fingers; and our Dutch Style Menu, which allows customers to choose a fry and one of 15+ dipping sauces.

In addition to these items, customers are able to customize their baskets across six styles of fries and over 20 sauces, seasonings and toppings.

There is a familiar saying you hear often when referring to the Lone Star State-   "Everything is Big in Texas". Well, that saying sure rings true for one of the most unique and novel franchise brands to come onto the QSR scene in years.

Our presence is fixin' to get big and introduced to fellow Texans statewide in the coming months in our largest Texas markets: Austin, Dallas, Houston and San Antonio. This phenomenal growth spurt comes just over a year after opening our first Texas franchise unit in the Alamo City, Labor Day weekend of 2016. Now is the time for prospective business owners and opportunistic entrepreneurs to consider our exciting franchise model and discover for themselves an opportunity where timing really is and can be everything.

 Four (4) flexible Franchise Business Models are offered:

·   Food Truck/Trailer/Cart,

·   Inline (food court, no dining room)

·   Kiosk (free standing 12 x 20 unit) and

·   Brick and Mortar (free standing,drive thru, dining room).

Our flexible concepts fit any real estate format including freestanding restaurants, end caps, in-line sites, gas and convenience, airports, malls, outlet stores, entertainment and tourist districts, cinema, travel plazas, universities, as well as other retail environments. There simply is no other competitive QSR franchise brand offered to prospective franchisees with such flexibility of choice in business model, endless store location sites to consider, and all achieved at an attractive development cost range of $105,000 - $250,000 dependent on the business model selected.

We are currently looking for hard working, motivated individuals to join our growing list of franchisees. Franchise opportunities are currently available in communities and towns throughout Northern, Southern Eastern, and Western Texas, of all major metropolitan areas.

We are looking for regional development groups that have a proven track record and are community leaders who may already operate other local businesses, such as other multi-brand restaurant development groups, retail outlets, convenience store chain operators, and movie theater operators who have the passion and financial qualifications to develop anywhere from five (5) to fifty (50) restaurants in these regions across the state. We are looking for qualified candidates with career work experience in any field (no restaurant experience required) and that are dedicated to their fields of expertise with proven track records to join our Texas team.

Our Texas franchisees will have endless opportunities to grow quickly into successful multi-unit franchise operators supported by our Texas franchise development team based right in the heart of Texas, San Antonio.  The Texas Master Franchise is owned and operated by native Texas businessmen with a vast array of industry knowledge and seasoned track records as successful business owners. One of the Texas Master Franchisors is a Texas Ex.

Franchisees get unsurpassed local support and services in every stage of franchise development from start to finish.

⇒ Texas Master Tenant Broker and Site Selection Services

⇒ Local pre-opening, grand opening and ongoing training and operational support

⇒ Statewide vendor & supplier network customized for our Texas franchisees

⇒ Franchisee business planning, consulting, financial and coaching support and services.

Please call if you have questions, or desire additional information.

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Supply Chain Concept

“Beautifully un-sexy” home-based, unique and highly scalable, B2B business model in a recession-resistant Trillion-dollar industry.

This business is a one-stop solutions provider for manufacturing and distribution companies throughout the world. We specialize in transportation, packaging, waste removal, and pallet supply needs. We strive to be the go-to for supply chain America by helping our customers consolidate their vendors to one, their point of contact to one, all with the very best customer service, quality products, pricing, and communication available.

No direct competition in franchising: there are other models who can do some of the things we offer, but NOT everything. We provide full-service logistics, industrial packaging services, warehousing, and have an eager willingness to evolve to ensure we find solutions for any of our customer’s supply chain needs.

Investment: $80,000 to $156,500.

Please call if you have questions, or desire additional information.

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 If you are seeking top-quality financial / investment advice, I highly recommend

Teamwork Financial Group and Doug Moe...Texas Ex.

Doug is the CEO of Teamwork Financial Group in San Antonio.  He is an attorney and CPA.  He has provided valuable insight to me and my wife regarding investment / financial advice, including guidance on having a Will vs. Revocable Living Trust, re-balancing our investment portfolio, as well as assisting us move a portion of our IRA investments into Fixed Asset Annuities.  Over the past several months, I have had a number of very enjoyable meetings with Doug, since we have a tendency to spend time talking sports, as well as financial / investment stuff. Doug played basketball at UT in the 80s and is the son of Doug Moe, the former coach of the San Antonio Spurs. And, a great guy.

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Do You Need Furniture Repaired...

If so and in the San Antonio area, CALL Pat Bonney...Texas Ex... Owner of a Guardsman Furniture Pro. franchise...The Most Trusted Name in Furniture Repair. Pat was on the UT baseball team in the early 70s.  I have used Pat's service multiple times for a variety of furniture repairs in my business and home.  Great guy and fantastic service.     210-849-9663    Email: gfpsa@sbcglobal.net

 

Don't Just Change Your Curtains...

Change Your View. I Did. My Story 

 

2017 newsletters; as well as copies of 2016 and 2015 newsletters can be viewed by going to the Franchise Quest Website.  

Click on the Website link below, or go to:

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Small / medium size business owners:

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Hook 'em.