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Thread: Franchising Timeline

  1. #1
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    Default Franchising Timeline

    I thought I would post up a possible opportunity that presented itself today. I'm posting this here, rather than in the 'Franchising' subforum since it's been rather quiet here lately.

    A takeout restaurant is on the market right now. There are 2 locations, in two small towns, far enough apart to not cause customer overlap yet close enough to support each other when needed. I'm wondering how long it would normally take to develop a working franchise model. I know it is far too early to be planning franchises, but when I look at the numbers (haven't even seen these yet though I have spoken with the manager of one of the two locations) I want to know if I'm looking at a mid-term project (18-36 months) or a long-term (36+ months) project before the working model can be proved out. For the purpose of this post, assume that there is adequate experience in food service, restaurant management, and general business management brought by the people involved.

    Again, this is so early in development that I haven't seen real numbers yet, nor have I studied the existing business model, so I can't really answer any questions that relate to what is being offered.
    Brad Miedema
    Fulcrum Saw & Tool

  2. #2

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    I have no idea what I am talking about so forgive me.

    Long enough for there to be a system as to how the restaurants are managed. So there is a manual to follow for future openings. I suppose if the food and atmosphere are good the franchises will sell themselves quickly. You could begin talking with a business lawyer.

    How long have they been in business?

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    It's too early in discovery to bring in a lawyer. The only reason I posted this was because it's been rather quiet here on this part of the board. Who knows, maybe if this goes beyond something in my head there will be a lesson in here for someone else.

    This is a different business than what I would normally consider because there is no one thing that stands out to me as being extraordinary, yet the sum of the parts really does show a greater value than what's just on the surface; which is the only reason I've spent some time thinking about it.

    The restaurants have been around at least 10 years under the current ownership structure though I do believe longer still as another "meh" franchise. Given this aging, I would think that I'd be looking at documenting processes and procedures so that they can be implemented easily as well as figure out branding (already got some ideas here that can be spun off into value add as well) and solidifying margins.
    Brad Miedema
    Fulcrum Saw & Tool

  4. #4

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    Everyone says the restaurant business is rough. Spoilage, employee food theft... CUSTOMERS! Ten years in I would guess - it to be a midterm project.

    I been daydreaming about this one that is for sale.

    Willygoat.com

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    Quote Originally Posted by Bobjob View Post
    Everyone says the restaurant business is rough.
    Yet they say that about every business. I actually hoped our restaurateur bloggers would have weighed in, though they haven't posted in over a month.
    Brad Miedema
    Fulcrum Saw & Tool

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    Thought I'd bring this back up as this has fizzled out and I'm going to explain why I walked away after making my standard offer of "I'll put up a $100 and role the dice as I have no idea what I'm getting into."

    It's been about 2 months since I started looking into buying the restaurant and the seller is refusing to give any information up to, and including, an asking price. The seller would rather waste everyone's time and hold meeting after meeting while forcing a potential buyer to "blink first" when it comes to value.

    To anyone reading this who is looking to sell a business - do the necessary prep work and come up with an initial asking price (and how it was arrived at), equipment values, IP values, inventory values, full set of financial statements, etc. Anything less, is a waste of everyone's time and will probably result in what could be construed as a very insulting initial offer.
    Brad Miedema
    Fulcrum Saw & Tool

  7. #7

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    That's lame. Sorry you are dealing with one of those types. I agree, you must have a due diligence report ready before you even put the business up for sale.

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