Re: Re: Franchises in Spain

#97895

Anonymous
Participant

I could never understand why franchising was a good model, if you had the skills to run a type of business then surely you’d just open your own.

The main reason for franchising a business is to expand a concept rapidly and into new territories. So a business like YumYum restaurants (Pizza Hut, KFC) or McDonald’s expand rapidly throughout the world by borrowing money from the franchisee. These companies are very very picky who they allow to operate one of their restaurants and the investment in terms of money and time is extensive.

So if anyone offers you a franchise without seriously questioning your ability to run and finance the business in question it will not be worth your time or money. Rather than you doing due diligence on them they will do it on you!

By the way if you had a failing McDonald’s restaurant, they would not let you fail rather buying the franchise back off you (at a loss of course) and find someone to take it over. I am also aware that all the well known brands (that’s the point by the way, they are well known) have a very long waiting list of people willing to become franchisees

regards

Paul