Why Restaurant Franchising is better than Starting Your Own Restaurant
An investor who seeks a business that is easy to open and attract pre-existing customers should choose franchise restaurant as his best option. These ready-made outlets can speak for itself as compared to an independent establishment whose score card has not even been developed yet. If it is a business start up, there are several stages of development is has to go through before it becomes a polished model, and this involves a lot of crossroads and blind spots which can lead to miscalculations and heavy aftermaths where the ability to rise up from those mistakes can means a heavy financial loss or a closure.
One of the things it takes is to be able to identify the real consumers which is not that easy because too often we would assume that those who come and eat in our restaurant is already our customer. It takes a person who is alert enough to know how to distinguish from among the many, who among them is really the primary customers; which is either that one individual or group -that has cracked the genuine value of the firm. Those who are not keen in identifying their primary customers will simply dismiss it saying that everyone is just buying the same products anyway. Time will tell if the many who have assumed this argument would realize that there is a need to optimize every limited resource one has. Attention is limited. Our attention and resources need to be given to the people whom we can call our true customers. It is difficult to generalize so it is safe to say that thriving businesses may have identified their true customers and knowingly serving them, but the opposite is also true. But when the intent is to establish a business enterprise, which position would you rather take?
While it is true that buying a restaurant franchise will cost you more than starting your own, getting business financing for franchises tends to be easier to acquire. For one, the score card of other performing outlets can adequately bear the revenue potential that it can generate in contrast to a groundless speculation. And with a franchise, the business has been there long enough and they have already identified their primary customers where they can put all their resources and attention. So when you are buying a franchise, even if you are unknown to the bank, being backed up by a known establishment is already more than a good collateral to them.
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Think of it this way, when you buy a restaurant franchise what you are really doing is paying everything that it takes to come up with a ready-made business. A 10-Point Plan for Businesses (Without Being Overwhelmed)