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Which Franchise Would You Pick with $1M in Cash?
Posted on 7/24/19 at 3:12 pm
Posted on 7/24/19 at 3:12 pm
Say you had $1M in cash which franchising opportunities would you be looking at?
20
Posted on 7/24/19 at 3:14 pm to OleWarSkuleAlum
Chick-fricking-fil-A
Posted on 7/24/19 at 3:19 pm to Ron Cheramie
quote:
Chick-fricking-fil-A
Without hesitation.
Posted on 7/24/19 at 3:24 pm to Ron Cheramie
quote:
Chick-fricking-fil-A
This would be the answer if they sold franchises (which they do not.)
Posted on 7/24/19 at 3:29 pm to Ron Cheramie
quote:
Chick-fricking-fil-A
While the AUV of $4.4M seems impressive, when you dig deeper and realize you have zero equity in the company (corporate owns the land, the building, and the LICENSE) you’re essentially a glorified manager that can be replaced it becomes less appealing.
They only pay their “Operators” 4-6% of the gross revenue so $220K based on the AUV of $4.4M is basically slave wages.
Posted on 7/24/19 at 3:30 pm to Costanza
quote:
This would be the answer if they sold franchises (which they do not.)
They act like they do but you’re essentially paying them $10k for a managerial position that you have zero input in the location of.
Posted on 7/24/19 at 3:32 pm to OleWarSkuleAlum
Your calculation does include an expected failure rate. CFA has a failure rate approaching 0% while the same cannot be said for Subway, for example.
There is more to this than purely which franchise gives me the highest ROIC.
There is more to this than purely which franchise gives me the highest ROIC.
Posted on 7/24/19 at 3:36 pm to lynxcat
quote:
Your calculation does include an expected failure rate. CFA has a failure rate approaching 0% while the same cannot be said for Subway, for example.
Yes that’s true. However, for a measly $220k it isn’t worth it at all.
Posted on 7/24/19 at 3:42 pm to Ron Cheramie
quote:I heard the average net for each location is around $300,000/year for the owner.
Chick-fricking-fil-A
Posted on 7/24/19 at 3:47 pm to lynxcat
Chick Fil-A is interesting because they really franchise differently than almost everyone else. I believe you can only get one restaurant no matter how much money you have, and your community/church involvement matters more than how much money you have (once you meet their thresholds).
Posted on 7/24/19 at 3:51 pm to OleWarSkuleAlum
Does Cane's franchise? Cause I'd be fricking in.
Posted on 7/24/19 at 3:55 pm to OleWarSkuleAlum
Depends on region, I'd definitely look into Culvers for the midwest.
Being a chic-fil-a operatoris rather cheap but you can't own one. It is still a money maker.
Being a chic-fil-a operatoris rather cheap but you can't own one. It is still a money maker.
Posted on 7/24/19 at 3:57 pm to Keys Open Doors
quote:
Chick Fil-A is interesting because they really franchise differently than almost everyone else. I believe you can only get one restaurant no matter how much money you have, and your community/church involvement matters more than how much money you have (once you meet their thresholds).
You can have more than one location but it impacts how many hours you work as you have to put in so many hours at each location under your control.
Posted on 7/24/19 at 4:10 pm to Brobocop
quote:
Does Cane's franchise? Cause I'd be fricking in.
Only in certain areas (California, Las Vegas)
Posted on 7/24/19 at 5:06 pm to OleWarSkuleAlum
To be selected to run a chik fil a is like 0.01% and most are internal hires. and it doesn’t cost anywhere near a million
Posted on 7/24/19 at 5:19 pm to OleWarSkuleAlum
quote:
However, for a measly $220k it isn’t worth it at all.
And they typically end up awarded 2 locations located in close proximity. I know of only one in the country in the Houston/Katy area that operates 3, all within minutes.
measly $220k.
Posted on 7/24/19 at 6:09 pm to Brobocop
quote:Yes, but not in Louisiana.
Does Cane's franchise? Cause I'd be fricking in.
Posted on 7/24/19 at 8:12 pm to jimbeam
Chick fil A charges $10,000 franchise fee and pays all start up costs, including the building. No personal net worth requirement, as many franchises have.
The company leases everything to its franchisees for a fee of 15% of sales plus 50% of pretax profit remaining. Owner can’t have other active business interests, which usually limits them to one store, and they pretty much have to get in there and fry the chicken. Not a passive investment,
Chick-fil-A gets more than 20,000 inquiries from franchisee candidates every year. They select between 75 to 80 per year.
LINK
This can be found on the company’s website and many articles, yet ethically challenged former EPA director Scott Pruitt had his staffer approach a corporate rep to see if his wife could get a franchise. They should have told her to come on down and strap on an apron.
The company leases everything to its franchisees for a fee of 15% of sales plus 50% of pretax profit remaining. Owner can’t have other active business interests, which usually limits them to one store, and they pretty much have to get in there and fry the chicken. Not a passive investment,
Chick-fil-A gets more than 20,000 inquiries from franchisee candidates every year. They select between 75 to 80 per year.
LINK
This can be found on the company’s website and many articles, yet ethically challenged former EPA director Scott Pruitt had his staffer approach a corporate rep to see if his wife could get a franchise. They should have told her to come on down and strap on an apron.
Posted on 7/24/19 at 9:58 pm to OleWarSkuleAlum
anyone know anything about mellow mushroom franchise?
Posted on 7/24/19 at 10:02 pm to Cdawg
quote:
And they typically end up awarded 2 locations located in close proximity
I don't think it's correct that most end up with more than 1. I know a guy that operates two and from what I understand from him that is pretty rare
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