| While the restaurant industry can be difficult to | | | | Knowledge - this may be the number one reason |
| succeed in, the numbers that are out there are | | | | that most restaurants fail. People think that they |
| just a bit misleading. Yes more restaurants fail | | | | can have a snappy concept and it will work and |
| than succeed, but that is more because the | | | | they know nothing about ordering, labor |
| people that are opening up restaurants have no | | | | percentages, product yields and shelf life. |
| idea what they are doing. How many times have | | | | Franchises educate their owners and some go as |
| we heard about movie stars that open a hot spot | | | | far to have their own universities that must be |
| and it goes belly up less than 2 years later? | | | | graduated from. |
| Today, it is even more competitive and knowing | | | | Money, Money, Money - getting a loan from a |
| the benefits of restaurant franchise can give a | | | | bank is almost impossible for a restaurant owner |
| future restaurant owner a leg up on the | | | | unless they can prove without a doubt that their |
| competition. | | | | concept has a chance of working. When dealing |
| Known Brands - for just about any concept that | | | | with a franchise, the model for success is already |
| is out there, there is also a franchise that is | | | | in place and this promotes confidence in the |
| available. Salad Works, McDonald's and Outback | | | | lending institutions. Some companies will also work |
| are all perfect examples of brand names for | | | | out financing themselves and in essence, back |
| restaurants that are filled all the time. Normally, | | | | their own restaurants. |
| when people have an option, they will go with a | | | | Product Quality - the independent restaurant |
| proven brand versus risking spending their money | | | | owner is literally at the mercy of their suppliers. |
| at a place that is a risk. | | | | You get what they give you and unless you are a |
| National Advertising - when a restaurant owner | | | | major account, there is little bargaining power. A |
| decides to step out on their own, everything that | | | | franchise has the power of every restaurant |
| they do to promote the restaurant falls into their | | | | across the country behind it and because they will |
| lap. A franchise operator has the benefit of | | | | often have an approved vendor list that all |
| national advertising that is taken right out of the | | | | restaurants must buy from, the prices are much |
| franchise fees. This gets the restaurant name in | | | | cheaper and the product is much better. |
| the spotlight and keeps it there. | | | | Yes, the restaurant industry is a tough one to |
| Success - there are far fewer franchise failures | | | | succeed in, but it is far from impossible. Even if a |
| than there are Mom and Pop failures. There is an | | | | restaurant owner wants to eventually open their |
| enormous amount of research that goes into | | | | own concept, it would be a smart move to open |
| deciding the right locations for restaurants and | | | | a franchise first and see how restaurants are |
| very few times will a place like McDonald's open a | | | | meant to be run. It may not be the ideal concept |
| location in a bad spot. The owner is the one that | | | | for someone, but the knowledge gained will pay |
| benefits from all of their corporations hard work. | | | | of tenfold down the road. |
