STARTUPBIZHUB

How to Start a Restaurant Franchise

Franchising permits restaurant owners to keep away from problems by replacing an extremely motivated franchisee.

And because the franchisee has a venture in the unit, the restaurant performance will usually improve.

From the point of view of the management, because the franchisor’s income is according to the franchisee’s overall sales and not from the profitability monitoring unit level, the performance becomes considerably less hard and also less staff is needed.

Almost all kind of business can be a franchise. But, it is only possible if they meet the three main criterions which are salability, ROI and “clone-ability”. For you to sell franchises, your restaurant should have reliability for the point of view of the potential franchisees. A good way to know if you have a “sizzle factor” is if you are receiving unwelcome franchise inquiries. If it is, then it is a good sign that your franchise will sell very well.

Second of all, you must be able to clone or duplicate your restaurant. Although some high-class restaurants have a successful franchising opportunity, the main basis here is if the franchise is can be taught and if it is systematized. If your restaurant needs a high-class chef, then you must consider revising your franchising strategy.

Another thing that you must keep in mind is that your restaurant must give enough return to both the franchisor and the franchisees. It all means that you will require modifying your franchisees’ possible returns or income by decreasing a royalty. If your franchisees able to make a familiar 15 percent return or income on investment on an established franchise, then maybe your restaurant is good for franchising.

If you are the one that decides to franchise, your initial job is to deal with the various issues regarding new franchisor. This includes the speed of growth, the location enhancement, the support services, the stuffing and fee structure and other things that you have to deal with. And evidently, your strategy must be subjected to precise financial analysis. After that, you will need to create a franchise contract, an offering circular and state registration.

Superior control usually interprets into the enhancement of a business manual and a clear training program. Your manual must have all the information that the franchisees need to know like how to set up and manage your restaurant. Though there may be some exception when it comes to sharing your recipes because it is the main secret of your restaurant. You may also be needed to incorporate the quality control checklists, the policies, the procedures and strategy that will permit this system to be consistently imposed so that you will keep away from any liability. Lastly, you must require making a franchise prospects and enhancing marketing materials which may aid you to make the sale.

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2 Comments

  • Kana said on March 11, 2016
    I would like to start a Panda Express in London/ Croydon area UK.Please let me have more details.
  • Dinesh Prasad Ojha said on July 20, 2017
    Hi,i would like to start kfc in Nepal/Dhangadhi. can you please let me know more details and provide tips to start a restaurant or cafe. Please assist me how to start first and how to get franchise and how much i have to pay to get franchise and what is process to pay amount. And if you know about any other good franchise, which is affordable for medium class restaurant than please let me know how much you can, help me out on this begging. Right now i am planning to open a restaurant or cafe. so i need your suggestion how i establish it within limited budget. And to take franchise is beneficial for me or not. i will wait for your reply. Regards, Dinesh Prasad Ojha

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