Anybody ever own a franchise.

[MuirWannabe]

Take this with a grain of salt as I've done exactly zero research. But I've always thought owning public storage was a good business. People have too much crap. They need a place to store said crap. Seems low maintenance. You collect your monthly payments and just have to keep the place up to a decent degree. Don't even think a franchise fee is needed. Just buy an existing site. Just a thought like I said.


Muir

 

[Walt34]

DW's nephew opened a franchise Bubba's sub shop with a partner. Lasted about three years and did not end well. The usual - way too many hours, couldn't find employees who show up, actually do some work, and don't steal. They sold out at a substantial loss. I thought he was nuts from the start (does the world actually need another sub shop?) but kept it to myself.

 

[ExFlyBoy5]

DW's nephew opened a franchise Bubba's sub shop with a partner. Lasted about three years and did not end well. The usual - way too many hours, couldn't find employees who show up, actually do some work, and don't steal. They sold out at a substantial loss. I thought he was nuts from the start (does the world actually need another sub shop?) but kept it to myself.

I hear this often. Our favorite local NY Deli just closed after being the only authentic NY deli in the area for a very long time. His biggest reason? He couldn't get employees to show up, even though he would pay them $12/hr. He and wife worked there 6 days a week open to close without a vacation in over 10 years.

I have also talked to two fairly new restaurants that had to delay opening by more than 2 months because they couldn't find employees! I know the area I live in is fairly affluent, but wow, I had no idea it was so hard to find people to work!

 

[freedomatlast]

Take this with a grain of salt as I've done exactly zero research. But I've always thought owning public storage was a good business. People have too much crap. They need a place to store said crap. Seems low maintenance. You collect your monthly payments and just have to keep the place up to a decent degree. Don't even think a franchise fee is needed. Just buy an existing site. Just a thought like I said.


Muir

At one of my rental properties, I have five garages that I rent out separately from the house. I keep the rents below what the nearby storage businesses charge, don't raise the rents very often on the good tenants and they stay fully rented very close to 100% of the time. When someone leaves, there is always someone else ready to rent. Also it's much easier to evict a storage unit tenant if the need arises since it isn't considered their residence. And yes, it is amazing what people will spend to store their junk year after year.

 

[pb4uski]

I have considered a Papa Murphy's franchise. It's a take and bake pizza concept. I think it is a pretty good business model. Relatively low overhead for food service. No ovens to buy and maintain, just a couple refrigerators and a mixer. Need around a $300k net worth with $80k liquid. I've worked the last ten years in full service restaurants. It's always pretty stressful and I thought this would be a good alternative. Oh, and they are my favorite pizzas.

Why not just work at one for a few months to learn the business and then open your own take and bake pizza shop? We had one in our town about 20 years ago and I loved it.

 

[petershk]

I think like just about everything else... Success will be unevenly distributed and working a ton and caring will make a difference as will understanding the business.

My first job was at a pizza place and I saw lots of areas it could be improved from a customer experience as well as an operational point of view. I did a few things and that was fun... But it's HARD work so I was way happier when I started coding websites for 3* the pay .

I suspect a more successful outcome would be to work at the franchise... Try to become a manage, save all your money and use THAT to help pay for college .

Sent from my HTC One_M8 using Early Retirement Forum mobile app

 

[petershk]

My sister, lol of all people said to me last night.. "why don't we open a franchise"??

I think she was dead serious (unfortunately).

So anyone ever own a franchise? I always think of fast food which equals long hours,lots of work.

experience.

But at least the pay is bad


Sent from my HTC One_M8 using Early Retirement Forum mobile app

 

[bclover]

About 10 years ago, one of my collegues in the actuarial field decided to open up a ColdStone Creamery franchise because he was passionate about ice cream. They provided training; I remember him bringing samples to work.

He opened up in a university town nearby and it did not work out well. I think he had the usual problem of getting reliable help so put in way too many hours himself. He eventually locked up and gave them the key and went back into the insurance business. He said that the amount of risk he assumed to what HQ assumed was unconscionable (i.e. he took all the risks).

Things I'd worry about: inflated costs of equipment/ingredients you're required to buy from HQ, how many competing locations they can open nearby, how often they'll blanket the world with offers and coupons which you must honor even though you lose money and, as noted above, dumb things HQ can do (including just closing down) that can kill your little business.

I'm not cut out to be an entrepreneur- can you tell?

lol, all the coldstone creamerys around here are closed.

 

[haha]

Oh, and they are my favorite pizzas.

Papa Murphy's? This strongly suggests that you have never tasted a good pizza.

 

[Dan4495]

This thread makes me hungry. I think I'll go out and grab a pizza and an ice cream.

 

[retirementguy1]

So everyone that has commented has no first hand knowledge about franchises. Is that correct? They are all stories on top of stories.

 

[retirementguy1]

Papa Murphy's? This strongly suggests that you have never tasted a good pizza.

Tell me where to go then?

 

[frayne]

So everyone that has commented has no first hand knowledge about franchises. Is that correct? They are all stories on top of stories.

Nothing wrong with a little empirical observation and comment. I don't need to jump off a cliff to know the sudden stop at the end is going to cause pain.

 

[bclover]

So everyone that has commented has no first hand knowledge about franchises. Is that correct? They are all stories on top of stories.

I think it's one of those things where there is so much data around it that you can believe the gist of the stories.

It's considering opening up a new restaurant. I've never done it before but there is definitely enough information around that I can reliably believe that they have a high failure rate.

nothing wrong with that.

 

[aja8888]

So everyone that has commented has no first hand knowledge about franchises. Is that correct? They are all stories on top of stories.

The franchise owners that post here are all still at work.....

 

[retirementguy1]

Nothing wrong with a little empirical observation and comment. I don't need to jump off a cliff to know the sudden stop at the end is going to cause pain.

Nothing empirical about it so far. The empirical data supports that franchises are more successful than mom and pop shops. Mom and pop shops are under-capitalized and more likely to fail in the first three years. Simple as that. Just to get a franchise you need to have more capital and stability.

 

[retirementguy1]

Why not just work at one for a few months to learn the business and then open your own take and bake pizza shop? We had one in our town about 20 years ago and I loved it.

Most employees are in high school. I doubt I could get a job there. Also, a national chain gets 10% off food for buying bulk. If I set up in the same town I'm not sure I would be able to compete.

Your idea is a good one to learn more about the franchise.

 

[harley]

Tell me where to go then?

What a set up line! I can't wait for Haha's response.


Edit: I see you are in NV. When I was looking at rental property in Reno we ate at SouthCreek Pizza. It was excellent! Wood fired ovens, fresh ingredients, really good (but not cheap). When I get back there I plan to go again.

 

[Rickt]

I have owned 3 three franchised hotels over the past 21 years. Needs a lot of capital investment and loong hours. Must have good manager to succeed. The property I personally manage has been profitable for me but I have sold the other two manager-operated properties after owning them for 8 and 4 years respectively because of marginal profitability. Due to the real estate component of the property(depreciated each year under ownership), I did have capital gain when I sold the properties. I now have one franchised hotel property and will retire after selling it in 2017.

Franchising model works but like any other business it requires capital and long hours. Franchising system makes it easy to grow your business across multiple locations though.

 

[Lucantes]

my kid would get an empty warehouse, construct a pole, blow the remaining money on a "dancer" name "cinnamon" and tell me it's the best class he's ever taken.

Where do I sign up for this class!!??

 

[Al in Ohio]

The news is full of incidents where a parent company's missteps will negatively impact the franchise community - Jared (Subway), emissions (VW), eColi (Chipolte) and on and on.

Things that happen around the world can impact your pocketbook, through no fault of your own.

The Brands high fees for marketing and onerous quality standards can leave a franchisee with little to show for their investment.

My personal thoughts are that the Internet has leveled the playing field for small proprietor owned business where you can have similar visibility on eCommerce vs a franchise if you have a crack eCommerce team working for you.

Jared and eColi will barely be a ripple to those two giants in the franchise world in the long term. I have a friend that has owned 5 Subway franchises. She bought her first twenty years ago after getting tired of the schedule of an airline stewardess. She makes millions on those five Subway stores. And Chipolte? No way this eColi thing slows them down. They will continue to be making a ton of money.


Sent from my iPad using Early Retirement Forum

 

[Al in Ohio]

One thing I forgot from her experiences. In the beginning you need to put in loooong hours to be a success, but once it gets going you then need to be gifted in selecting good employees and especially store managers. Eventually the goal is to have each store run by a trusted manager while you do as you please except to check in.


Sent from my iPad using Early Retirement Forum

 

[ExFlyBoy5]

Jared and eColi will barely be a ripple to those two giants in the franchise world in the long term. I have a friend that has owned 5 Subway franchises. She bought her first twenty years ago after getting tired of the schedule of an airline stewardess. She makes millions on those five Subway stores. And Chipolte? No way this eColi thing slows them down. They will continue to be making a ton of money.


Sent from my iPad using Early Retirement Forum

I have NEVER heard stats like that from a Subway franchisee. About the best case store sales is about $15K a week. 22% NET profit is running a VERY tight ship, so on a store that performs at NEAR THE TOP you are looking at about $170K per store/per year...and that is the VERY TOP end. When I looked into it with some "decent seriousness" back in 2011/2012, the numbers of a GOOD performing store were about a 1/3rd of the numbers I just posted and I don't think they have gotten THAT much better in the last few years.

And as for the Chipotle franchise...yeah, they don't exist.

 

[Rustic23]

Never owned one. See my post in 'Opinions Needed: Ice Cream Business For...' for things I have learned from friends pizza business. Not something I would consider for retirement income.

 

[haha]

I think the average corporate or government worker who buys a franchise will feel that he or she has been run over by a truck. Hard to avoid divorce too.

If you are going to need money beyond retirement, hang on to your cash and do not buy a franchise. Keep working a while longer, or if necessary a lot longer.

To me at least the business and political future looks very little like that in which most of us have spent our lives. It may well turn out that the 50 years between WW2 and the millennium will in hindsight be understood as the high water mark of the Western version of society. Most of us have really liked it, and sometimes don't realize what an unusual state it represents.

Ha