Re: looking into the possibility of buying an existing franc
āOnlyā 5 miles! What is the delivery charge there? How much it do the drivers get? Fair compensation for a run like that (10 miles round trip would be 55 cents x 10 or $5.50.) If I was only getting a buck per run, I wouldnāt be excited about delivering that far either.
Itās hard to get quality employees at minimum wage or less. Just like equipment and ingredients, you get what you pay for.
Re: looking into the possibility of buying an existing franc
āOnlyā 5 miles! What is the delivery charge there? How much it do the drivers get? Fair compensation for a run like that (10 miles round trip would be 55 cents x 10 or $5.50.) If I was only getting a buck per run, I wouldnāt be excited about delivering that far either.
Re: looking into the possibility of buying an existing franc
so some of you arenāt sure this is a good idea for me to invest in i can understand that.
but essentially i get to own and experiment with marketing and all aspects (donāt get me wrong i know how to run a shop)
and own all of the equipment for 12K
I donāt want to own a franchise forever, This provides me with the opportunity to buy equipment and a business.
that way when i do decide to open my own independent shop i donāt fall on my face. ( pretty sure i wouldnāt i have 2 years experience as a GM of a chain store)
How much did you guys spend on all of your equipment (small wares, pie board, oven, pos, mixer, walk in etc. more than 12K?
Re: looking into the possibility of buying an existing franc
Just a walk-in will cost you 12K.
I know you probably saw my post on your other thread, but you really need to look into the franchise rights. A franchise can NOT be picked up and moved without company approvalā¦ not even across the street let alone 90 miles.
The local guy across town almost certainly has the rights to expand and you need to find out from the company what is available for territory.
Furthermore, before you sign ANYHTING and after you find out if the location can be moved at all, yoou need to find out if the franchise organization will approve YOU as an owner and what hoops you have to jump through.
Re: looking into the possibility of buying an existing franc
The CEO told me we can move wherever i want to. but what he says and what the agreement says are two totally different things i understand that. And i will understand if i cant move it in to my city. although i had a very good chat to day with the owner of the store thatās already here in town. he said will support the move as long as Iām not to close. and i help him with a more powerful marketing campaign Like doing a full page add in the phone book instead of a 1/2 page and combining with him on door hangers to get a better deal.
Re: looking into the possibility of buying an existing franc
OK so i finally got some info on the restaurant over the phone i get to see the lease and all of the numbers on Wednesday.
so here it goes
shop doing 12-15k a month average
4k food per month
700 week labor
1400 rent
every 4 months 350 extra for maintenance
Gas 180
electric 300
phone 128
insurance 108 per month plus 25 for each driver
Royalty 250
First off, at $15K a month, that is only $180K a year (on the high side of his āestimateāā¦ low side is $144K). How much do you plan to pay yourself from this business? That is a really, really low earning store.
What is the market like? Is this guy just not doing a good job? How does it compare to other franchisees in both numbers and market?
How much obligation would you be taking on? Will you be contractually stuck with them for a long period?
I guess unless I figured that this business was really just poorly run and was a diamond in the rough, I would not want to take on someone elseās headache. Unless those figures can be improved upon substantially, you may well be working for less than minimum wage or for nothingā¦ owners get paid last contrary to a minority opinion that we are getting rich off this risk.
Re: looking into the possibility of buying an existing franc
this guy works at a big plant in this area and is never at the shop his x used to run it. now he just wants out i plan on moving it and giving it a fresh start.
plus in a couple of years i may drop the franchise and just use the equipment in my own brand shop. and i figure if i can make a little along the way and get all of the equipment for 10k why not. were talking about every thing you would need to open a place.
Re: looking into the possibility of buying an existing franc
Well, be sure to figure in all the uncompensated hours you will put in towards that cost. Also, if you proceed, make sure you pass it through an attorney and have a contract. You need to be very, very careful you are not buying some debts you donāt know about or that the franchisor has a non-compete preventing you from opening your own store if you leave them.
I am not trying to discourage you. Just want to make sure you donāt let exuberance obscure prudence.
Re: looking into the possibility of buying an existing franc
You would be entering into a franchise agreement with this company. These agreements are not simply contracts of convenience that you can turn on and off. I really think you ought to look into this in detail before you go any further.
Re: looking into the possibility of buying an existing franc
this thread is getting silly now - so why do something you donāt believe in?
This thread is getting very confusing now, sure this shop has a triple stack oven - are you wating to buy equipment, a franchise or what? We appear to be going around in circles (or maybe another shape - Iām not sure).