How to Franchise? Min requirements

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Does someone like me really have to be worth 800k to open a franchise like this? Or does that include the loan money you'd be given if approved by a bank?

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Raising Cane's was $2,000,000 of personal, liquid assets when I inquired 6-7 years ago.

Most business fail in the first 3 years, so Id guess the liquidity requirement is them looking to see if you have enough personal reserves to make it thru that.

Just a quick google search, about a year old.

LINK

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6. WENDY’S: $40,000 The going rate to open a Wendy’s franchise is $40,000, plus a minimum net worth of $5 million, and minimum liquid assets of $2 million. The restaurant, which first opened in 1969, was also the first fast food chain to open a salad bar.

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Whoa!

Well to be honest I haven't chosen anything in particular yet because I don't know what's in the realm of possibilities. I have about 250k cash and I'd like to change careers. I'm 36, married, first kid on the way, like to work, and have a good support structure around me. Just trying to figure out what I could do from this point and franchises seem to be a decent route? I could do what is popular and buy an expensive house (which is the road we're heading down) or we could rent for $1400 a month and change our outlook to something different. I just don't want an insurmountable amount of risk since we have a baby coming. If it were just me, I'd roll the dice...

Is franchising something tough? Can't be.. I see them all over the place, and I'm a college grad that loves business. Just not familiar with this subject.

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Is franchising something tough? Can't be.. I see them all over the place,

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Really, really look at all those franchises. Think about them. Now exclude Chick Fil-A.

What kind of margin do you imagine they have?

The majority of them are shitholes scraping by with unsatisfied customers, undesirable employees, and minimal margins. It is hard f***ing work to create a culture of success and high expectations when your employee pool is minimum wage to $12/hr. I'm not saying you can't survive, but I don't think you will experience the success you may be envisioning.

Not with ONE franchise, at least.

Ya, I bet.

I imagine a big part of it is no one is thinking about it on the macro level.

One employee thinks the few times a week he hooks up a friend won't cause the business to go under. He's not accounting for the 20 other employees doing the same thing. Soon enough, you're out $5,000 a year or more.

Oh no doubt.

The way we caught him was very by chance. Customer came in to return some items and hands us a receipt that had all handwriting for the items and prices. This is not normal. He took the regular forms and instead of typing them out and running them through the computer, he wrote the items and pocketed the cash money. He only did this when they were paying with cash so we had no record with cards. We had so much extra inventory that there was no telling how much he took.

Iirc, after my dad confronted him, he admitted to it and even brought inventory from his house back to our store. I havent talked to him in almost 20 years and he was a lifelong friend.

No telling what other employees could have been doing.

We busted workers at my friends McDonalds multiple times. Just giving away free shite. Theft in stores like those are unreal. Its not preventable

Like any other business owner, you have to be present and involved. The benefit of a good franchise is that it's come with a structured set of rules and guidelines to follow. You don't have to do the work that a startup would have to do.

If you're talking restaurant franchises, theft is really the least of your worries. If you know how to run a restaurant, you can mitigate theft fairly easily... daily sales reports, cameras, draw audits, food cost etc will either keep employees honest or allow you to pinpoint the problem quickly. Not that it doesnt happen but it's not a problem like it was, say, 15 years ago. Id say it starts with finding good management and above restaurant leaders. The big thing to worry about, cost wise, is repairs on restaurant equipment, A/C, ventilation, building repairs and improvements, etc. It can be never ending and exhausting.

It's a fulfilling and rewarding if you have the guts to take the plunge.

You may have to find other investors for your first location. If you're successful your options open up with regards to bankrolling your next ventures

Now you know why most franchises, especially in fast food, are multi-unit. You have to have a lot of net worth to get in the door.

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Just giving away free shite. Theft in stores like those are unreal. Its not preventable

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It may not be 100% preventable but with a proper inventory management system you can keep it very low.

The big problem is owners not doing accurate, regularly scheduled inventory counts. (I get it, it's a pain in the arse and a big time sink but it's your money!)

Do not depend on any employee to do these counts. They will scam the system.

Here are some free fries
Here's a free coke
Here's a free piece of chicken
Here's a free wrap that we 'dropped on the ground'

The first two are stuff you can give away all day and there's almost no way to notice if the employees are smart about it. The next two are easily doable.

And fwiw, the example I used above at my friends McDonald's, the manager was I guess you could say in on it when we caught them once.