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Most franchises can be copied and started without getting roped into franchise fees. A sub shop is one of them: cold fresh food, a couple of tables, a cold counter, can be opened in a strip mall, decorating is plain, number of employees is low.
You have a point, but what you're really saying here is that if someone has the drive and savvy, they don't need the crutch of a franchise. OTOH, building a fast-food business from scratch is a year of nonstop work even if you have experience, capital, savvy and a measure of luck. The jumpstart provided by a known brand and other positive qualities of a franchise operation can make the difference.
On the gripping hand, though, anyone without 20 years of experience and net worth to burn is probably somewhere between deluded and an idiot to try and break into the field, regardless of method.
The cheapest franchise to open is a Chick-fil-A. Franchise cost is only $10,000 and they pay ALL startup costs: real estate, construction, equipment, everything. Then they lease it to you. So much higher on-going costs. Sound good? They get about 20,000 applications per year and select between 70-80.
And you only get one store which makes the owner really focus on that store's operation.
If you have enough money to buy a franchise, why not just buy a triple net property with a franchisee on it, and collect rent from them?
That is what We owned ..we owned the lease rights on the property, not the property ...we had some really big tenants ..
. The tenants include Allegro Pianos, Faust Pianos, exercise equipment company SBR Multi Sports, franchise bakery Le Pain Quotidien
Last edited by mathjak107; 07-12-2019 at 02:41 PM..
That is what We owned ..we owned the lease rights on the property, not the property ...we had some really big tenants ..
. The tenants include Allegro Pianos, Faust Pianos, exercise equipment purveyor SBR Multi Sports, franchise bakery Le Pain Quotidien
In that case, what is the property owner's benefit? Does he get a cut of your lease?
In that case, what is the property owner's benefit? Does he get a cut of your lease?
They were compensated decades ago for selling off the lease rights ..it was a long term lease right that went on for 50 years and then reverts back to the co-op which is the 200 Central Park south building . our partnership sold the rights to a developer in 2014 ..I think there is still 13 or 14 years left..
manhattan rents by Central Park soared making these lease rights very valuable.
Ashkenazy group paid 18 million dollars for them when we sold and they had i believe 19 years left. We had a 10% stake.
So just owning lease rights in a hot area can be very lucrative...
Last edited by mathjak107; 07-12-2019 at 02:49 PM..
IMO, the $5 footlong failed because they skimped on the fillings, and never even gave you $5 worth of value. There's NO WAY that $5 footlong cost the franchise person $4 to make.
More like $1 from what I've seen at our local Subway places...
IMO, the $5 footlong failed because they skimped on the fillings, and never even gave you $5 worth of value. There's NO WAY that $5 footlong cost the franchise person $4 to make.
More like $1 from what I've seen at our local Subway places...
Cost of actual delivered product is a small part of total cost, as you should well know. And in this case, I wouldn't be surprised if franchise/promotion participation costs exceeded that of the sandwich.
That’s just being overly conservative. I can’t imagine learning much in year 20 that you didn’t already learn in say, year 5.
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