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Old February 3rd, 2013, 07:26 AM   #1
cj65
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Default Franchise owners

Is anyone here in this position ? I been offered a opportunity to buy a little ceasers. It is in a good location and seems like it turns a nice profit. I am going to meet with the accountant and go over everything on Tuesday. I just want to know what are the pros and cons of owning a franchise . Thanks for any good input.
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Old February 3rd, 2013, 07:38 AM   #2
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pros - your working / cons- your working for someone else

franchise fees suck

if you dont make it in the 1st year, you have nothing to show, you just get replaced by someone that wants to make a small investment.

best of luck
private pizza shop owner
last 12 years

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Old February 3rd, 2013, 07:46 AM   #3
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bottom line- there's not much profit after franchice fees, your working for a paycheck, and you dont get paid overtime
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Old February 3rd, 2013, 07:56 AM   #4
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I hadna buddy open 4 of them in FL. There business plan was vrry simple. They require yountongo tomthere corp in colorado iirc. Then they require you to buy all of your product from them which are pre made. They have done this so nobody can f it up. The only real thing to manage is the payroll, employees, sales, payables. It really did seam very simple.
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Old February 3rd, 2013, 07:59 AM   #5
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Location, location, location.

Also in the immediate 10 sq miles the owners havent changed. So something must be ok. I do have a feeling most owners own multiple locations.
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Old February 3rd, 2013, 08:22 AM   #6
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one of my best freinds opened a Quizno's 5 years ago, after the 1st year, Head Office wanted him to open a second location in town. he couldn't afford to loose buiss, to another franchise-ee, so he invested another 50,000 into
2nd location. After it was up and running, Head office dropped a bomb on him by lowering the price of a sub to $5.00 to compete with Subway.

He lost it all, closed both his locations, and had nothing to show for his investment of $100,000

just like subs, do you know how many $5.00 pizza you need to make, to make a profit ?
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Old February 3rd, 2013, 08:37 AM   #7
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Quote:
Originally Posted by XJcoupe View Post
one of my best freinds opened a Quizno's 5 years ago, after the 1st year, Head Office wanted him to open a second location in town. he couldn't afford to loose buiss, to another franchise-ee, so he invested another 50,000 into
2nd location. After it was up and running, Head office dropped a bomb on him by lowering the price of a sub to $5.00 to compete with Subway.

He lost it all, closed both his locations, and had nothing to show for his investment of $100,000

just like subs, do you know how many $5.00 pizza you need to make, to make a profit ?
their product is pretty low quality, i'd imagine not to many.
the only thing i'd really be concerned about in food cost is cheese....
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Old February 3rd, 2013, 08:47 AM   #8
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their product is pretty low quality, i'd imagine not to many.
the only thing i'd really be concerned about in food cost is cheese....
up here, the cost of a 5 pound block cheese = a good case Canadian Beer
yes it is exspensive over $30 bucks
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Old February 3rd, 2013, 09:57 AM   #9
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Originally Posted by XJcoupe View Post
one of my best freinds opened a Quizno's 5 years ago, after the 1st year, Head Office wanted him to open a second location in town. he couldn't afford to loose buiss, to another franchise-ee, so he invested another 50,000 into
2nd location. After it was up and running, Head office dropped a bomb on him by lowering the price of a sub to $5.00 to compete with Subway.

He lost it all, closed both his locations, and had nothing to show for his investment of $100,000

just like subs, do you know how many $5.00 pizza you need to make, to make a profit ?


A few years ago Quiznos was a huge thing, i used to love that place. Seems they all packed up and left.
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Old February 3rd, 2013, 09:59 AM   #10
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Understand the franchise fee structure (is it tiered or flat?). What are the other requirements (I.e. must you buy their supplies? Pay into advertising?).
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Old February 3rd, 2013, 12:47 PM   #11
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You are in Romulus? Check with the Wayne County Department of Economic Development to see if they offer free business basics classes for residents looking to start up. If the county doesn't, there may be a Michigan Small Business & Technology Development Center (SBTDC) location near you that can offer some guidance.

I work for another economic development agency and we offer classes, including basics on opening a franchise (and sometimes setting you up with a SCORE counselor) for free but you need to be a resident here.
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Old February 3rd, 2013, 12:51 PM   #12
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You are in Romulus? Check with the Wayne County Department of Economic Development to see if they offer free business basics classes for residents looking to start up. If the county doesn't, there may be a Michigan Small Business & Technology Development Center (SBTDC) location near you that can offer some guidance.

I work for another economic development agency and we offer classes, including basics on opening a franchise (and sometimes setting you up with a SCORE counselor) for free but you need to be a resident here.
Ok thank you. I'm looking into this as a option to early retirement. I don't want to drive a garbage truck for ever. I plan on being out of it in five years. The birth of my son has changed my outlook on life. I live at work now. I start at 3am and generally work till 3pm. Not sure how much I would have to be present at the little ceasers. A family member owns about ten now and wants to retire he is in his 60's.
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Old February 3rd, 2013, 01:15 PM   #13
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I have some a few friends who own franchises. They are all in the food service industry (a few Biggby Coffees and a Subway) and they all put in some very long hours, but they seem to be successful.

My friends with Biggby Coffee locations were routinely working 12-16 hour days 6 or 7 days a week, especially when they opened their first location. Once they were able to get a few employees that they could trust with things like opening and closing the store, taking deliveries, etc. things seemed to calm down for them and now they seem to work a much more manageable schedule.
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Old February 3rd, 2013, 01:30 PM   #14
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WHY is the current owner selling?????????

do you KNOW the facts? maybe there is something you can learn from a truthful answer.
is the accountant you are meeting with yours or theirs? buyer beware.

early retirement eh? will you get a pension? does early retirement provide you with health care coverage?

can that pension be attached by someone else if your franchise goes belly up? are you protected?
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Old February 3rd, 2013, 01:46 PM   #15
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I could elaborate, but location is by far the most important factor. It become very obvious if you do a proper business plan. 1 customer more an hour adds up to a substantial amount of $ at the end of the month. It is usually worth it to pay for a premium spot. I am also against franchises unless you can afford to open multiple spots. But you may be onto a good deal, I dont want to discourage you. I know someone who made a good amount of money owning Little Caesers restaurants, but he had several.
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Old February 3rd, 2013, 01:54 PM   #16
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Quote:
Originally Posted by jimhri View Post
WHY is the current owner selling?????????

do you KNOW the facts? maybe there is something you can learn from a truthful answer.
is the accountant you are meeting with yours or theirs? buyer beware.

early retirement eh? will you get a pension? does early retirement provide you with health care coverage?

can that pension be attached by someone else if your franchise goes belly up? are you protected?
Current owners are my mother inlaws cousin and her husband. They are in their mid sixties. They want to retire. The store I am looking to take over has two managers that have been with them for ten years. I have 401k. If I can swing it I plan to work 5 more years at my current job and hopefully take over all their ten stores they have. They are good people and I have known them for ten years since I meet my wife. They are actually my wife's godparents. The accountant is theirs and we are going to go over everything. They are at a point where they just check in once a week on the stores. So I am told. I am hoping this would run smoothly and be a easy income for my family. I have a few rental homes now for easy income but I don't want to stay in the rental business.
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Old February 3rd, 2013, 02:51 PM   #17
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Why are you doubting this deal then? Seems like you have it all figured out. Hopefully that is the case. Either way, if you know them and trust them as much as you say, shouldnt you be asking these questions to them?
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Old February 3rd, 2013, 03:13 PM   #18
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Why are you doubting this deal then? Seems like you have it all figured out. Hopefully that is the case. Either way, if you know them and trust them as much as you say, shouldnt you be asking these questions to them?
I have and I do trust them as much as anyone else I know. But I really want to get outside opinion. It's a large amount of money I have to put out. And I don't want to lose it all either. I guess I will know more on Tuesday.
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Old February 3rd, 2013, 03:21 PM   #19
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If they are at a point in their business where they just check in once a week, why wouldn't they keep doing it into/through their retirement? It would be easy money. Something tells me it's not what it appears....
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Old February 3rd, 2013, 07:06 PM   #20
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do you have experience at running a pizza joint?...HR?..finances?.....security?
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