Food and Drink Franchises – Making the Right Choice
The food and drink franchise industry in without a doubt the largest section of the franchise industry in the UK and the world. With some huge names and brands out there such as McDonalds, Subway, Dominos, Burger King and Cost Coffee you know what you are buying into and you know you are going to gain plenty of people through the door. However as well as these large brands there are literally hundreds of smaller franchises with 20-60 outlets only and although they may not be as well known as the bigger brands they can still be great opportunities to buy into.
When buying a franchise the key is in your research. Here are some tips when buying into food and drink based franchises.
1. Do not look at one brand only. Create a short list of a half dozen franchises which are of interest. Where a franchise might be successful in one area it might not be successful in another so jumping in head first is never a good idea. With a short list of available franchises to buy that are of interest you can then begin your research.
2. With your short list in hand you are probably going to have some well known brands and some lesser known brands. Generally you will be able to see the difference immediately in that the lesser known brands do not cost so much so you need to weigh up the benefits of the brand name crossed with the custom it will generate and compare it with the smaller brand whom the local area may not have heard of.
3. Density of eateries and drinks outlets in your local area. Looking at your shortlist you should then go out into the local area where you are looking to open your outlet, if you are hoping to buy a pizza franchise and there are already 4 existing then you are going to be buying into an already saturated market. Cross out any on your list that have too many outlets open near you or broaden your territory range for opening of your outlet.
4. How long have your remaining short list been in business for? The golden rule about franchising is that you are buying into an established business. Finding out from the franchisor how long they were in business before they franchised and how long they have been franchising for is a must. Do remember though that McDonalds went to franchise back in the 50’s almost immediately after opening up their first store. However, a general rule of thumb is you can trust a franchise who has been in business a long time more. There are many start-up franchises out there though and with these you can expect a much lower initial start up costs.
5.Hopefully have made a few decisions now, with your remaining franchises contact the franchisor and ask for a list of current franchisees, with this ling in hand you can start contacting them and find out how well they are doing with their franchise and if the promises made in the promotional materials are being fulfilled.
Having done the above and the rest of your due diligence you may still be left with several choices and this is where personal preference comes in. Would you prefer looking after a pizza outlet, burger outlet or coffee outlet etc? There are obvious plus points and minus points to them all depending on your own personal preferences.
With the right research you can come out with a fantastic food franchise or drinks franchise which is going to see you and your family with a profitable business for life. Many people jump head first into buying a franchise and this can be a very costly mistake so do not be one of them and go into research head on and ensure you ask the right questions and do your area research to the best of your abilities. Best of luck with your new franchise choice!