Restaurant franchise: pros and cons

Restaurant franchise: pros and cons

You are already ripe for opening your business, and your goal is a small cafe? Then what about the franchise? For many, a franchise is an almost win-win option because they provide all the conditions, help and support.

Franchising in Ukraine over the past 5 years has gained very impressive momentum. Take, for example, the same Aroma Kava – we leave on Khreshchatyk, and there immediately three crowded points. And norms, everyone is happy. One of the reasons for such a quick replication is the opportunity to get your own business, while making relatively little effort. This, in essence, is how to buy a ready-made business.

But let’s still decide what is this “franchise”, and its pros and cons. As a result – we need to figure out whether the game is worth the candle.

What is franchise and franchising

Let’s start by explaining the terms. We will simulate the situation – you want to become part of the coffee shop network. In this case, everything has its own role and name.

The Franchise is what you want to buy – the right to use the brand, business model, trademark and technology, etc.

Franchisees – You are the franchisee. Franchisor is the party that transfers the franchise to you.

All this works thanks to a franchise agreement.

Of course, this way of doing business has just a bunch of its pitfalls that can both help and ruin the whole business. Therefore, we consider the pros and cons to which we were able to get to the bottom in the process of communicating with our customers.

Advantages

Marketing

When buying a franchise, you first of all buy a name. And this is just a huge advantage over starting a business from scratch. After all, you do not need to spend relatively large budgets on advertising – for starters, just advertising is enough, the main motive of which is “Hey dude, you drink our coffee near work. Now we have opened near your house. ”

And due to the fact that in addition to you, another 10 people bought the franchise in the city, a franchise advertisement flashes in each district. And this is a collective mutual assistance.

Recognition

Often, potential consumers already know the brand, and therefore are not afraid to come to a new place.

It is worth noting that if the franchise is already well known, then demand is likely to be high at the start.

Choosing a “name”, we strongly recommend that you do everything you can. You need to be sure that the franchise has worked well. After all, who wants to pay for the schools of others?

Reputation

Here it’s worth talking not about the franchise, but about you as a businessman. After all, good conditions for starting and support level 90% of the mistakes of beginners. And this is a great chance to prove itself.

Support

Here, in principle, everything is clear. If something doesn’t work out for you, there is definitely someone who has already filled a bump on this problem and will help you avoid it.

Purchase price

You bought a franchise, which means that you can make purchases on behalf of one customer. And since purchases from the franchise are large, then the prices are lower.

Disadvantages

Investments

As we have already said, this method can come out more expensive than opening your own business from scratch. Sometimes much more expensive. The franchise price depends on many indicators, but the main ones are success, reputation and customer trust. And the steeper, the more expensive.

It is important to stipulate that buying a franchise is, roughly speaking, only a name. But renting premises and equipment, decorating the premises also needs to be addressed. And it also needs money.

Legislation

If you had to buy a foreign franchise, and in this case you got the role of a pioneer, there is a possibility that you will encounter a number of legislative problems and inconsistencies.

Staff

Everyone talks about it, but nothing changes. After all, finding good and sensible workers is difficult. Very hard. And even a big name may not help.

Be prepared for the frequent training of new employees, and the cares of old ones. The turnover is large, and there is little time for training. Therefore, try to find staff through acquaintances or friends.

Margin

Before you buy a franchise, torment other franchisees with questions. Do not hesitate to ask about income – to clearly understand what level of income

Life style

You must understand that you can forget about your previous life – there will be no idle time, as such. A weekend and even more so. Holidays and vacations are also by.

Cheating

Some franchisors are cheating – they promise help, support and assistance. And all this remains only in words or on a landing landing. Therefore, when choosing a franchisor – be extremely careful and attentive – it is worth going through all possible sources of information.

Royalty

The franchisor will have to pay the amount annually. And there’s no getting around it. Nevertheless, this money goes to promotion and improvement.

Output

Of course, opening a business, even a small one, even on a franchise, is very difficult. This is time, and nerves, and money, of course.

We told you about both sides of the coin – both about the goodies and the disadvantages of buying a franchise. Therefore, before you take this serious step – think, it’s worth the game of candles. We hope our article will help you make the right choice. Good luck!