As a child, my parents were friends with a couple that had a 7-11 store. Seems like they were always in their 7-11 shirts and even when they would come over for dinner they would call the store maybe twice during the evening to make sure all was OK.
I’m a subcontractor in construction and keep asking my accountant, in what other business could I invest my money, since he handles the payroll to most businesses in town, his answer was: keep doing what you’re doing or start a church 😂
Lol he is right churches don't pay any taxes, non no property taxes either. I know a pastor that is my customer. He bought 17 acres land, built his home on it, and use the rest of the land as a get together space for church gathering, but they only gather there maybe once a year, because his church is not there, it's 45 minutes away.
@@TradingOptionswMndr Day Care is super regulated and things can go wrong. Your dealing with little kids, parents and money often from the government. Stick with churches.
@@jimstand Based in the Chick-fil-A reviews on this channel, Mike's comment seems to be a realistic assessment, given that you really have no equity in the store in the long run.
The real money is investing in a new and amazing brand of your own. People love and support fresh new ideas and if marketed with super good food and efficiency you have a win!
I think pizza is a big money maker if you make good pies and in a good location. I grew up in the Buffalo area and we have some great pizza (not the best of course). I worked at a pizza place that was killer but the management stole money and the owner wasn't around that much. Anything besides pizza or wings was not good enough. But the pizza was magical. Many years later the competition is still there and making huge money!!!! I now live in Pennsylvania and the local pizza leaves a lot to be desired. I just buy their dough and make my own at home. So even though I could make some decent money do i want to make pizza all day long?
I own a national pizza franchise. Just one location. Doing $18k to $20k per week in sales. Store is paid off. I make around $250k per year but I don't have a general manager. I run the store myself along with 2 other assistant managers. This year since the corona shut down sales jumped dramatically. We were up %100 over last year for several months. I'm probably gonna be well over $300k this year. Sales are starting to level back out now though. Still up around 40% over last year. BTW, Looking to sell the store soon. Just bought a beach property in FL and plan to sell everything and move there in the next year or two.
I managed fast food restaurants for years, back in the late 70's and early 80's. I managed Taco Bells, Long John Silvers and Burger Kings. I still say the key to high volume is friendly customer service and quality of product. Most places have employees who could care less and their quality, like hot food, is almost non existent. Chick Fil A does so well because their restaurants are clean, employees are friendly and their food is hot. It's NOT rocket science! I would love to take over a poor performing restaurant and turn it around.
dennis do way too much work? I wouldn’t think so if he said his wife was the GM. Meaning the owner wasn’t really there for the day to day. Seems pretty decent to have that plus his regular income from work (If he worked)
@@dennisfinesse I know BK franchise owners in similar situations, the area manager runs the show, the store managers run each store, owners will usually only visit each store once a week for an hour or two, just to keep an eye on things. It's largely passive income.
As someone that worked for Wendy’s for 30 years, most of that as a franchise field consultant, I agree with much of what you say. It’s good factual information overall. Fact is, franchise stores are more profitable than company owned. The Company always scratched their heads trying to understand why. The answer is simple. Franchisees as a whole operate better and eliminate the Corporate BS and policies that takes up managers time instead of focusing 100% on QSC. To make big money in the QSR industry, you have to play the long game. Over time you pay off the real estate and keep it when you sell. Also, there is BIG money in soft drink syrup “marketing rebates” from Woke-a-Cola, Pepsi, Dr Pepper. If you’re a multi-unit owner, that is BIG money that doesn’t show on the store level P&L. I have friends and/or know of franchisees that have sold their stores after 20 years, netted millions and have a huge real estate income stream in retirement. And yes, along the way, they made a very very good living because they ran great operations.
He does not know his number. Dunkin donuts makes more money than McDonald's. If not they make the same. He needs to be removed. He is fake honest. And I am a owner of both. Google, this dude is a lie
I know the senior care industry extremely well. I’ve been seeing an increase in unaware entrepreneurs entering this market and it’s a disaster. I highly recommend working in this industry before opening a senior care franchise. It is MUCH harder than unknowing entrepreneurs realize. Yes, it is less expensive to get a franchise and has high revenue potential, but be prepared to not have a personal life for the first 5 years or more, unless you plan on paying staff to handle the business, which is also very risky. Additionally, there is a lot of very competent competition that will eat your lunch if you don’t know this business well. I hope this helps!
Very true! One of the reasons we suggest buyers call us as we spend considerable time determining their operational preferences and abilities and aligning that with an appropriate brand. There are also 100% passive senior care franchises available with zero involvement if that what people are looking for. Thanks for the comment!
Bob, when you said the average net income for all food franchises is only $82,033, I didn't need to hear anymore. I stopped the video as well as entertaining the idea of owning a fast-food franchise. Thank you so much for your insight!
@@kenthhamner2641 As long as you are profitable, who cares that it is 3x the investment? Banks will gladly lend you the money for the second and third stores. Also, it way easier to sell a franchise of three stores as opposed to a franchise of one.
I was skeptical about watching this. And it actually took coming up 3 times before i clicked on it. I assumed it would be just a nonstop sales video pushing your product. I was very wrong. Truly exceptional information and valuable. By the end of this video I was actually thinking about opening a franchise using your service one day. Thank you for being the total opposite of what everyone else on YT does. Wishing you continued and constant success! -JBT
The other factor you have to remember is that most chains make you re-invest into a renovation every 3-6 years. It could cost you 200k, so if you are earning 100k per year out of your business you will have to also set side 25% of that for renos.
Correct, but my remodels haven't costed me that much. So far I've only been required to remodel my customer area about every 7 years and it has costed me between $7500 and $10k each time. However one year every store in the country was required to install a new point of sale computer system and that costed me $14k.
I have my own food business and I hear nothing but complaints from franchise holders that the mother company is regarding them as a cash cow. These places are at the mercy of the franchise which is demanding them to sell a certain product that end up as a failure or you can only buy their equipment at a 300% upgrade as what you can get at the local equipment store.I heard them even demanding them to build in a drive thru at a cost of $150,000 that took YEARS to pay of. I am thank God NOT in a franchise. I work hard and I am wealthy as well. You don't have to be a slave to do well.
This is solid and accurate information! The only thing that id like the viewers to consider is. The yearly income, no matter how great or small is "consistent"! So that's the upside to investing in name brand locations!
Very true! Consistency and predictability is one of the factors we ask clients to rank on our business goals sheet. For some investors senior care or staffing is a terrible choice, food the perfect choice. Many variables to consider. Thanks for the comment!
My mom's friend's son has a wife who worked at a Tim Hortons in the Buffalo area. She saw an opportunity to partner with the manager and buy the establishment. They put some money together and became the new owners and immediately got to work. They got rid of bad staff and hired older folks that were much more trustworthy and not afraid to work. Over time they saw immediate improvements and created a nice workflow. They reinvested the money in another location that was having some issues and got it back to where it should be. Now they own 10 locations! A couple are really small kiosks in the airport. Now that is the American dream!!! They started off as hourly employees and are now franchise partners. Covid hit them really hard tho. They aren't getting the commuter traffic like they used to but that will pick back up eventually. I think they weathered the storm. We just need let the covvid psyop implode. The whole plan is to get us injected and connected to vaxx passports but that's another subject.
When I used to be a manager. I love hiring elderly. They are grown up and mature. They have been through it all. They love their job and are happy. There's nothing better than coming to work and your employees are happy.
We had a small argument over a year ago and I did take your advice in the end on amazon trucking business. Margins were not good and the policy’s as well. So, thank you. You were right.
You would of been better off getting registered under the FMCSA along with your DOT number, operating authority, and became broker, or freight forwarder.
Great information as usual for aspiring franchise owners. The restaurant business is so saturated that I wouldn't suggest anyone get into it unless they are at least second generation restauranteurs and grew up in the business. It's just too much work for too little money with too much competition.
I agree. I was a restaurant manager for many years before I bought a franchise unit in the company I was working for. I've been successful because of my prior experience in the business. I've seen so many people with zero experience buy stores and just go through the simple 6 week training course corporate puts them through. They don't have a chance. This business will chew up any inexperienced operator. So many have lost their investment and folded. These are stores that I know I could manage and make profitable but the amateur just walking on the scene can't do it no matter how bad they want to. If you have money and want to buy a franchise but you have no experience in that business, you should find an excellent manager already working in that business and partner with them. Let them buy into 25% ownership or whatever split works for you guys and let them run the majority of operations while you learn what the hell you're doing. Learning won't take months. It will take at least a year and probably more like two before you can handle things like a pro.
A friend of mine growing up, his father owned 3 burger kings. And his mother (in his mother’s name, but father managed them) owned 2 Taco Bell’s and 3 pizza huts (one was a combined store). They were filthy rich, and they went away basically every other weekend. And had a beach house in Marthas Vineyard that they lived at the entire summer when school was out. Own one franchise, you’ll prob work your ass off and never stop. Build up to a handful, and you’ll never work again....
worked at a dunkin years ago and ended up working with the owner one night because the other baker called out sick...was a real eye opener he was cool and was telling me if he takes 10% after all is said and done he is happy.....not the money making machine you think...
Excited about a milk tea franchise I just bought. I believe I got the best location for starters. High traffic, low rent, check! Love from the Philippines! 💖
Thank you! I AM a Brazilian with a store in Brazil and another in Paraguay and your vídeos are a light for what i AM looking for the Future. It gives me a benchmarking and a direction. Thank you!
Thank you! I would caution that our videos are speaking to USA markets and may or may not apply to Brazil. I would hate to see anyone make a bad decision based on erroneous data :-)
Open an Evangelical church: the service is the promise of another life in Paradise (and nobody ever came back to complain that it wasn't true). You'll pay no taxes. Consider that.
A friend of owner a bunch of subways and has slowly been selling them. They don’t make much anymore. And I think the market offers so many other “healthy” fast food options. Subway never really evolved with the market and trends.
Do your math - many franchises are designed to make CORPORATE rich, not you, you are essentially signing up for a glorified job. I was a manager for the largest and highest gross revenue carpet cleaning franchise in the Midwest for it's respective franchise. I ended up leaving that job in 2018 after realizing I could start my own cleaning company and putting the same energy into it, make 3x the money I was making running 12 trucks and 25 technicians....with just one truck. Don't misread what I said - I didn't say triple the sales of the previous company, I said triple my personal pay. Better to work for yourself vs someone else.
The successful franchises are the ones with good employees. Remember, who you hire can make you or break your store. Also don't let your landlord get the best of you. Get someone to help you negotiate your lease.
He gives the net profit, but doesn't talk about the owner's income? So MCD Nets $150K but what does the owner pay himself or is that included in the net? So we don't own a franchise, and we pay ourselves $150K as income and net about $75K for a total income to the owner of $225K (assuming the net profit is not retained in the company which in our case it is). So when you buy a franchise find out what the average owner pays him or her salary on top of the net profit.
I said the same thing. I wish I had seen this years ago before I bought my franchised restaurant. The industry is very secretive and it’s hard to get straight forward information.
@@danjenkins2064 honestly even though you saw the video it still doesnt convince you until you test the waters..i run a small.coffee shop..not.easy but i am.glad i never got into a franchise..iv met a few franchise owners and it qas.really.tough on them.they were looking for.small businesses and stay away from franchises
I had no idea what the average net was for most franchises. I was in business for 39 years. I did engineering product design and manufacturing. I always thought to myself, "I should have bought a franchise." I'm now retired, basically considered wealthy and so glad I didn't buy a franchise.
I would imagine the "owners" are corporations that cut checks to the main shareholder. If you have 4 places paying you a $250 gm salary, you're making a million on a low risk business that can stay around for a long time. Chic fil a has the right idea treating owners like employees.
Buying an existing franchise saves a lot of money but you are inheriting their problems and that is usually why they are selling it. If you have experience fixing one such location then you do it again and again until you have a handful of locations.
Wow, these numbers are terrible! I think I’ll stick with stocks and mutual funds, which give me the same or better return with no time and no work required.
You may want to check your stocks over the last couple of days! Franchises also provide a saleable asset beyond immediate income that are not available with stocks. Thanks for the comment!
@@FranchiseCityOnline Stocks is the way, owning franchises is more like giving yourself a purpose on a daily basis, its important for most people. But the profit still gonna go to stocks, that's my situation atm.
@@FranchiseCityOnline Thanks for your videos. Honestly if I want to invest millions In MacDonald, I’d definitely buy their share instead of a franchise. But everyone has their own strategies.
Gross numbers are great, but the bottom line is what you want to focus on. My firm (My Franchise CPAs) works with one franchisee grossing over $1M in sales (single unit), but netting just $90K. Another grosses $700K and nets $370K. Both are painting franchises, but one is much better at managing costs than the other. So when looking for and picking a franchise, don't be deceived by the gross number. You need to really dig in to understand the bottom line potential of the franchise before making a purchase decision. ROI is also an extremely important figure to pay attention to. What are you getting for what you're paying on the front end?
I wish I had more time to watch more of these. They are incredibly done one of the best videos on the internet as far as I'm concerned. I spent 40 years working in the shipping industry, and I am so thankful that I didn't try to do a lot of the things that are warned about in these videos. These are all game changers if I was young and going to do this I'd be knocking on your door in a heartbeat. I am actually very sad that when I need expertise like this another Fields I can never find it. Keep up the incredible work thank you very much. I obviously can't say enough good things about what you do.
Someone who works in the Home Care Industry: The Fastest way to go under with a Senior Care business is: Not staying up top of training requirements, state and federal law. This is one instance you want to pay someone VERY well to give a shit about training requirements, laws, rules and regulations.
Blue Jedi I’d never want to be in that business. Most of the staff are going to be problems. It’s a low paying job that is doing very important work. I’m sure its hard to find anyone who is good at it, responsible, and compassionate.
Hi! Loved your video. I couldn't agree more. I am an Australian franchisor and have a mere 24x franchisees with a 100% success rate to date. I'd like to thankyou for expressing your professional advise on franchising and if I may (as a Franchisor myself) I would like to offer some additional information for people to consider before buying any franchise, anywhere in the world. For example ... Our franchise ... has a turn-key buy in price of $100k AUD It is a mobile service/"man in a van" type franchise. And excludes a vehicle/vehicle lease. Our franchisees make more than the big food retail outlets taking home after tax (on average) $100k AUD/year with a complete return on their initial investment in the first 6-12 months (on average). So if you could part way with $100k for our franchise or $350k on a Subway franchise and on average take home only $60k salary(with Subway) ... both of which require you to work hard in the business , then the choice is obvious. Now I know that our franchise is specific and not everyone's cup of tea. In our business you have to climb onto a roof and some people may prefer to just make sandwiches. However as an entrepreneur and having been exposed to many, many different business models I can see just how backwards some of these franchise brands operate. They lack innovation. The brand's HQ absolutely needs those exorbitant royalties and fees from their franchisees to survive but as a compromise they are starving their franchisees. I could write a whole book on this ... lol ...I would urge any franchise prospect who is considering buying a franchise that you buy into a franchise brand that has genuine innovation and is very transparent on the real numbers of their franchisees, including the lowest performers/units!!! Don't get caught up in clever marketing! As an example.. when we grant a franchise we want the prospect to fully understand the differences between our highest performers on $250k + income and the lowest on $70k take home income and why those numbers are what they are .. e.g is a franchisee choosing to only work small hours / put small effort in by choice because perhaps their partner has a high paying job?? But no matter the case, we invite the prospect to speak with those particular franchisees personally; to back up any information we are giving them and want them to make a comfortable, sound decision based more on logic rather than raw emotion and the illusion of what "real life business is not". I know this may be opening up a can of worms but transparency is what we believe in. Another example is..our system even allows all our franchisees to see and openly share their results and marketing performance and inner operations, so they can see how each other's business is doing etc.. WHY you may ask! Because our franchisees don't compete with one another!!! This is one of the biggest problems in franchising... too many units/saturation of a brand in too small a territory and lack of support!! I speak with some personal experience here. 18 years ago before I franchised TV Magic, I worked for a company where I only got to keep 30% !!! It was okay for a while, until then it became very demoralizing. Now, another point I would like to make is when we are marketing our franchise opportunity we make no illusion about "buying yourself a job". In reality, our franchise is like all other business startup. Whether you are an MLM business or you buy/inherit a business you are literally:- "buying yourself a job". If you truly are an "investor" and you are buying a self managed, automated business then you already know all this and I am not speaking to you - congratulations. However to the millions of people who dream of having their first business or are just starting .. when you have your first business don't be fooled by this illusion! Any business start up will require you to be there for your business in the beginning because no one is going to do it for you! Our franchisees were under no such illusion when they first met us or when they first started. Unfortunately, the definition of "passive income" is very misunderstood and quite often is only smoke and mirrors. That's not to say that any successful business doesn't have plenty of perks (when compared to being an employee) and passive income is not possible! But be careful if you are starting your first business and you have this idea that you will have enormous passive income and retire in 5 years time! Well that's my two cents worth of advice :) Oh and we're coming to the States soon! If you want a great opportunity, look at any brand that is a moving train and has low #'s !! Getting in early is key! Thanks for the video again. Cheers mate :)
As a huge KFC fan would love to know more details about a franchise costs/yearly numbers. Very interesting information, I really thought those fast food places were making tremendously big profits but you've really cleared the misconception about the real numbers. So food its a lot more costly to get off the ground than other areas of business. Great and very appreciated video highlighting the myths about businesses. Thanks!
In my twenties I used to want to own a restaurant but then worked in them for 10 years. The only way to make it as a franchisee is by owning multiple locations. Between employee theft, poor location choices you would be left with a few Ideal stores that actually generate profit. It's a tough business and things are not what they seem.
Can never believe the amount if money that business report. A coworker wife rented a space for think it was around 40 kid day care center. He would lease a $55.000 fancy pick up truck every three years and wrote it off because he done the maintenance on it. At Christmas time they purchased a $1,000 of $25 gift cards that they wrote off as Christmas presents but keep every one for themselves. At my first job owner cried the blues during contract talks. Said he was only making a very small profit. His wife was the president of their leasing company and received a $50,000 salary ( 50 years ago so now would be over a quarter million dollar salary ). The office did all of the paper work. All she did was sign around 100 owners cards a year. She get a top of the line new Cardiac every two years .Their no show sons & a daughter were also making big bucks for doing nothing.
The hours and investment from people who I have known ,don't advise a restaurant or franchise.There are people who have done well but you need so much to make it all work.
Going over the definitions for accounting terms in another video thank you! I “thought” I was going to earn a degree in business administration. Accounting gave me a migraine so bad I thought It would lead to a aneurysm. 😂 It’s a foreign language to me. Thanks for the people who do have the skill for this very important part of running a business.
After I bought a national franchise I started showing up to the meetings and they spoke a different language. I had to learn all their terms. I understood all the concepts but they called everything by a different name or 2-3 letter abbreviations.
I use to own 6 different franchises restaurants. subway,tim hortons,dunkin donuts,pizza hut,kfc,wendys each of the stores was in a busy location gross was very high but the net was around 32k per stores after paying employees rent food cost etc. So franchise is not a good idea if you want to make more than 30k a year.
I know of small independent food businesses that make over $500,000 a year profit , so why would anyone buy a franchise business where they have no control over their own destiny . Independent store owners can change anything on their own decisions such as menu , store interiors , their wholesale suppliers and pricing without having someone else telling them what to do
Has no one noticed that at an average volume of $2.8 million a year a McDonald's owner netting only 10% makes $280,000 a year? Now own 3-4 stores, do the math... : )
It is very important to consider franchise fees and royalties! I recall a lot of Dunkin Donuts franchises in Kansas and Colorado pulled the plug in the 90s and became independents. Perhaps they looked at the franchise fees and decided that once you know how to make donuts and can find other sources for ingredients through Sysco, US Foods, etc., what you were getting in return for the fees wasn’t worth the cost, e.g. national advertising wasn’t bringing in as many customers as promised, or coupons were too plentiful and cutting into gross. (Around 2004, all the DDs in Portland, OR closed, and many reopened as a local chain, but that might have been more of an issue with corporate ceding the Pacific NW to Starbucks, figuring it was too much to take on the coffee giant in their own backyard.)
You really have to have the desire to do this because most of the nets shown here can easily be matched for a college educated professional after only a few years in their field. Differences? Regular job:M-F 8AM-5pm, go home relax. Franchise: After a 10-12 hour day, leave the store. The assistant manager has your phone # to call you at night with the "crisis du jour"
It's absurd to state 'this is what a franchisee' will make as it's dependent on the value of the chain(goodwill) at any point, plus the environment(covid?) as well as the location. I've seen some units close down while others were (no doubt) making a pretty penny. There are some plum locations like airports and big cities, even with steep rents, where the franchisee might make a fortune. Then there are the places out in the boondocks where they hoped they'd have a winner, only to close. This is why Subway did so well for so long: the risk in a strip mall to build was tiny compared to building a separate facility.
Here is my take on the Food chains vs. other franchises. During the corona lock down who was still open the Chick-Fil-A drive thru or the salon? Which service does one NEED to survive, the Food chain restaurant or the salon? During a recession or depression which one are you going to cut your budget on first, the Food Service or the Salon service? End of discussion!
Biplav Shrestha true the timing couldn’t have been better. But majority of the franchises are still open so, buying an already established restaurant might work
Hey! Believe it or not, I have seen McDonald's, Subways, and Dunkin Donuts closed down in Queens NYC. Food industry is not that easy to run like you think.
Here is what I heard that you did not say explicitly - To have a profitable business, go to these franchises and provide them with services they need. The low margins they make is kind of an indication of their expenses to keep the business going.
The basic rule of franchising is this : will you invest almost half a million dollars just for a $30,000/yr salary? You could be the franchisor and have someone invest half-million instead, so you can collect a six-figure salary.
Also with Chick Fila the owner have to work in it. Their are very few people with 2 Chick Filas and almost no one with like 3-5. They dont just want someone rich to be a franchisee. They want you to work and manage your own store from 40-60 hours a week. I’ll past. If im opening up a franchise, its to work less, not more.
X2 the comment about "buying a job". The numbers here also show the fallacy of many peoples' mantras about " owning a business and being your own boss". It is a lot of time and financial risk for not a lot of money.
Hey Robert! I just wanted to say I'm a huge fan of your channel, it's really nice hearing someone give their take on some of the subjects you tackle who comes across as a legitimate entrepreneur and investor and not some random get-rich-quick guru trying to push their product onto me. I wanted to take a moment to thank you, thus far you've made videos on 2 separate suggestions that I offered and they were both very interesting and informative, I especially appreciated you going so far as to interview Banjamin Barry that one time, I wasn't expecting that AT ALL and the interview was extremely fascinating! If it isn't too much trouble (and don't feel obliged to do this), I wanted to hear your thoughts on what it would take to develop a six figure passive income. What are the potential avenues to accomplishing this? How quickly could each avenue be realized? What are the advantages and drawbacks to each one? What would be the monetary investment required for each avenue? If a certain avenue you recommend peaks our interest, are there any resources you would recommend looking into that don't fall into the realm of get-rich-quick trash?
Thanks for the support and the kind words! We'll be covering more general business/ online businesses content on the new channel. czcams.com/channels/MlfXbdlKmfP8jNK4i8i9Ug.html I'll do an updated video - and we'll actually be starting an online business in real time this year so you can follow along to see if we crash and burn lol. True passive is not that easy and takes a lot of work out of the gate. Depends on the budget you have. If I had to pick - definitely an online business, possibly affiliate marketing, and likely high ticket items. I really like the review affiliate model, so where people (genuinely) review cameras, shoes, phones etc, then drive the traffic to an affiliate page or link. We have had had success in education and fitness, but there are so many niches you can pick one that you like. Build a blog, index some videos, do social media and build a name. Its not really 100% passive but doing a video or blog post here and there doesnt take much time. Once the pages/videos are indexed it becomes more passive but by then you are addicted and will want to push out more content :-) For motivation visit some of the brokerages selling online businesses -(quietlight/flippa etc) these are people who built a drop shipping/ affiliate/ biz from zero, and are now selling for 6 figs or millions. If you have the budget some of these are semi-passive businesses that can be acquired. Definitely do-able, people are doing it - why not you!
As much as I love food, I'd rather invest in a service industry rather than food because of the low overhead. With food, there's expiration dates, great waste, random inspections, pest control, bad employees can ruin a business that cost the owner over $500k to establish and when you're locked in a lease then you run on losses. Barbershops, salons/nail spas seem to be the best bet. Senior care of child daycares seem profitable but also lots of liability as you're dealing with people's lives either too old and frail or too young either way your employees can easily ruin it and get you shut down.
I had a friend who owned three Subway locations. He had to own three just to make a decent living. The old franchise agreement stated no Subway franchise store would open within X km radius of the other store. Increasingly that was radius rule was decreased because you have Subway shops all over now. One store only brought in $32 k per year.
Great information. I couldn't agree more. As a cpa serving small businesses I see it all. And you were right on the money. I do see from the senior care to subway franchises. That's why I've developed accounting and tax 101 classes online for small business owners. I educate all Biz owners or start-ups before they take the decision and empower them to stay close to their numbers. I call it Love your Business numbers... This is the name of my CZcams channel. It's all about numbers 😁😁😁
My wife and I owned and operated a Dairy Queen for 10 years in a small town of 10,000 people. You hit the nail on the head about making $50k a year. The spring and summer months were profitable but November through February was difficult and stressful. In the month of December__you'll have 22k coming in and 29k going out. Dairy Queen still gets their 9% for advertising and licensing. We sold it in 2004 and never looked back.
I appreciate your video, (i've been in franchise development for 20yrs) but you only shared net profit for QSR. You didn't share profitability of Cleaning, Senior Care, or Staffing, - only shared the investment and sales. So,.. providing and comparing sales of the different categories is useless without comparing profitability. Just like your example in the beginning of the video about a franchise doing $10M in sales but had $11M in expenses. And don't forget ROI and NPV. Some concepts have ludicrous investments that thwart reasonable return on investment. Just my 2 cents :)
Franchisors often charge franchisees a percentage of sales, they don’t care whether franchisees make profit or not. It gets worse when franchisees are forced to carry promotional prices, which often are close to or even lower than cost.
How can a person put up a million and make 80-100k? Yowza-not for me. Majority of wealth in america is held in real estate. Real estate is more passive too. All professions have pluses and negatives.
I assume the numbers given for profitability are based on the store having a general manager in place. Most single store franchisees manage the store themselves and keep that money.
I think something else to realize in the video - if you work in your store, you obviously make more money because you are part of the *labor*. So if a Subway makes $41,000 net profit but you as the owner replace the labor of two $12 per hour employees (because employees tend to be inefficient) you made another $48,000 as a full time employee. You also saved money on labor, costs, taxes etc by working your store. So you can make a six figure income by being an OWNER OPERATOR.
only then they can make lil profit,,,,everyone does dis,,,,,,but u have to hire so many ppl .....one person salary $ 25000 per yr if u hire 4 ppl $ 1 lac,,,,rest misc expences,,,, at last u realizer u ain't making gud money ,,,,,,thats y most frenchise owners are unhappy ....actully they dnt get much as u see,,,,,,
Need help finding a franchise? 100% Free tools to help you find the profitable brands: Franchise City Brokers: www.franchise.city/our-services
As a former 7 Eleven franchisee this video is 100% accurate. Only having one store is generally a good way to buy yourself a 24/7 job. Don't do it!
So what buy more ?
How much is seven eleven franchise cost?
I had a little vending machine business and even that was an energy sucker.
As a child, my parents were friends with a couple that had a 7-11 store. Seems like they were always in their 7-11 shirts and even when they would come over for dinner they would call the store maybe twice during the evening to make sure all was OK.
@@yevgeniyfureyster3502 The cost would depend on location and turnover , every store would be different .
Spare yourself the headache. Purchase their stock and let it grow and live off the dividends in retirement***
This is the best 16 minutes I've spent watching CZcams videos.
What’ja buy? (or avoid buying??)
I’m a subcontractor in construction and keep asking my accountant, in what other business could I invest my money, since he handles the payroll to most businesses in town, his answer was: keep doing what you’re doing or start a church 😂
Lol he is right churches don't pay any taxes, non no property taxes either. I know a pastor that is my customer. He bought 17 acres land, built his home on it, and use the rest of the land as a get together space for church gathering, but they only gather there maybe once a year, because his church is not there, it's 45 minutes away.
@@HN-db5cn day cares don't pay taxes either
That church comment is spot on. No taxes.
@@TradingOptionswMndr Day Care is super regulated and things can go wrong. Your dealing with little kids, parents and money often from the government. Stick with churches.
🤣
In my opinion with Chick-fil-A you’re not actually a franchise owner you’re essentially just Buying a general manager job for $10,000
I don't care about opinions, what are the facts?
@@jimstand Based in the Chick-fil-A reviews on this channel, Mike's comment seems to be a realistic assessment, given that you really have no equity in the store in the long run.
I don't know many trades nor professions that will pay you 200k with only 10k worth of tuition.
As an accountant and somone looking into have their business in the future. your videos are gold. love your videos and love your business.
accounting firms make huge bank
The real money is investing in a new and amazing brand of your own. People love and support fresh new ideas and if marketed with super good food and efficiency you have a win!
I think pizza is a big money maker if you make good pies and in a good location. I grew up in the Buffalo area and we have some great pizza (not the best of course). I worked at a pizza place that was killer but the management stole money and the owner wasn't around that much. Anything besides pizza or wings was not good enough. But the pizza was magical. Many years later the competition is still there and making huge money!!!!
I now live in Pennsylvania and the local pizza leaves a lot to be desired. I just buy their dough and make my own at home. So even though I could make some decent money do i want to make pizza all day long?
on point, why pay huge franchise fee.
I own a national pizza franchise. Just one location. Doing $18k to $20k per week in sales. Store is paid off. I make around $250k per year but I don't have a general manager. I run the store myself along with 2 other assistant managers. This year since the corona shut down sales jumped dramatically. We were up %100 over last year for several months. I'm probably gonna be well over $300k this year. Sales are starting to level back out now though. Still up around 40% over last year.
BTW, Looking to sell the store soon. Just bought a beach property in FL and plan to sell everything and move there in the next year or two.
If you sold the franchise how much do you think you would get for it? How many staff do you have in total?
Hello, I was wondering if I could contact you to ask you a few questions. Thanks!
Three times earnings….where is your location?…
Hello, can I contact you for more information on which pizza franchise that is and how to get started?
Just came across your comment. Would you be open to field some questions from a beginner?
I managed fast food restaurants for years, back in the late 70's and early 80's. I managed Taco Bells, Long John Silvers and Burger Kings. I still say the key to high volume is friendly customer service and quality of product. Most places have employees who could care less and their quality, like hot food, is almost non existent. Chick Fil A does so well because their restaurants are clean, employees are friendly and their food is hot. It's NOT rocket science! I would love to take over a poor performing restaurant and turn it around.
Chick file a pays their employees better than most fast food places too
@@sportsMike87 KEY! They'll give what you give them at best and at worst they'll leave.
Loved that
Ok let’s do it !
@@lisabarnes4197 Ok, I'm on board!
My wife is a GM for a Wendy’s and used to see the pnl for the old owner. He averaged $1000/week each store but with 9 stores made him $450-500k/year.
dennis do way too much work? I wouldn’t think so if he said his wife was the GM. Meaning the owner wasn’t really there for the day to day. Seems pretty decent to have that plus his regular income from work (If he worked)
@@dennisfinesse I know BK franchise owners in similar situations, the area manager runs the show, the store managers run each store, owners will usually only visit each store once a week for an hour or two, just to keep an eye on things. It's largely passive income.
@@kylesummers2462 for that price range real estate rentals commercial or residential pay more then that.
@@dennisfinesse How much less work do you expect to do to bring in that very high amount of annual income?
Survivorship bias.
As someone that worked for Wendy’s for 30 years, most of that as a franchise field consultant, I agree with much of what you say. It’s good factual information overall. Fact is, franchise stores are more profitable than company owned. The Company always scratched their heads trying to understand why. The answer is simple. Franchisees as a whole operate better and eliminate the Corporate BS and policies that takes up managers time instead of focusing 100% on QSC. To make big money in the QSR industry, you have to play the long game. Over time you pay off the real estate and keep it when you sell. Also, there is BIG money in soft drink syrup “marketing rebates” from Woke-a-Cola, Pepsi, Dr Pepper. If you’re a multi-unit owner, that is BIG money that doesn’t show on the store level P&L. I have friends and/or know of franchisees that have sold their stores after 20 years, netted millions and have a huge real estate income stream in retirement. And yes, along the way, they made a very very good living because they ran great operations.
Let me find out. Honestly
Why you listening to a franchise owner. You're hearing it from a guy that possibly inherited
He does not know his number. Dunkin donuts makes more money than McDonald's. If not they make the same. He needs to be removed. He is fake honest. And I am a owner of both. Google, this dude is a lie
I'm not a owner, I m sorry sorry the fact is I own a Dunkin donuts
But he 🎉🎉is silly . Where is your ice machine cream.
Busy but are machines always work😊
I know the senior care industry extremely well. I’ve been seeing an increase in unaware entrepreneurs entering this market and it’s a disaster. I highly recommend working in this industry before opening a senior care franchise. It is MUCH harder than unknowing entrepreneurs realize. Yes, it is less expensive to get a franchise and has high revenue potential, but be prepared to not have a personal life for the first 5 years or more, unless you plan on paying staff to handle the business, which is also very risky. Additionally, there is a lot of very competent competition that will eat your lunch if you don’t know this business well.
I hope this helps!
Very true! One of the reasons we suggest buyers call us as we spend considerable time determining their operational preferences and abilities and aligning that with an appropriate brand. There are also 100% passive senior care franchises available with zero involvement if that what people are looking for. Thanks for the comment!
Bob, when you said the average net income for all food franchises is only $82,033, I didn't need to hear anymore. I stopped the video as well as entertaining the idea of owning a fast-food franchise. Thank you so much for your insight!
My brother makes that much repairing transmissions!
@@tomdalton4293 Yeah... but if you have three restaurants.💰💰💰
@@nattydreadlocks1973 it's also 3x the investment. People are so brain washed these days. All the bull💩 myths being spouted by leftists!
Its not that bad at all, better than nothing.
@@kenthhamner2641 As long as you are profitable, who cares that it is 3x the investment? Banks will gladly lend you the money for the second and third stores. Also, it way easier to sell a franchise of three stores as opposed to a franchise of one.
I was skeptical about watching this. And it actually took coming up 3 times before i clicked on it. I assumed it would be just a nonstop sales video pushing your product. I was very wrong. Truly exceptional information and valuable. By the end of this video I was actually thinking about opening a franchise using your service one day. Thank you for being the total opposite of what everyone else on YT does. Wishing you continued and constant success! -JBT
Thanks for the kind words! we appreciate the feedback.
I was the same. Very informative though!
The other factor you have to remember is that most chains make you re-invest into a renovation every 3-6 years. It could cost you 200k, so if you are earning 100k per year out of your business you will have to also set side 25% of that for renos.
Correct, but my remodels haven't costed me that much. So far I've only been required to remodel my customer area about every 7 years and it has costed me between $7500 and $10k each time.
However one year every store in the country was required to install a new point of sale computer system and that costed me $14k.
@@fivebooks8498 What brand do you run?
I have my own food business and I hear nothing but complaints from franchise holders that the mother company is regarding them as a cash cow. These places are at the mercy of the franchise which is demanding them to sell a certain product that end up as a failure or you can only buy their equipment at a 300% upgrade as what you can get at the local equipment store.I heard them even demanding them to build in a drive thru at a cost of $150,000 that took YEARS to pay of. I am thank God NOT in a franchise. I work hard and I am wealthy as well. You don't have to be a slave to do well.
This is solid and accurate information! The only thing that id like the viewers to consider is. The yearly income, no matter how great or small is "consistent"! So that's the upside to investing in name brand locations!
Very true! Consistency and predictability is one of the factors we ask clients to rank on our business goals sheet. For some investors senior care or staffing is a terrible choice, food the perfect choice. Many variables to consider. Thanks for the comment!
Im offering street pharmacy franchise. Must be willing to travel to Mexico for your franchise orientation
Lol I just get a kick out of the channel liking this comment lol
Im Interested
😂
@Blues is that an AR15 or AR14? Should ask Joe Biden maybe he knows?
The franchise is located in the US or Mexico?
My mom's friend's son has a wife who worked at a Tim Hortons in the Buffalo area. She saw an opportunity to partner with the manager and buy the establishment. They put some money together and became the new owners and immediately got to work. They got rid of bad staff and hired older folks that were much more trustworthy and not afraid to work. Over time they saw immediate improvements and created a nice workflow. They reinvested the money in another location that was having some issues and got it back to where it should be. Now they own 10 locations! A couple are really small kiosks in the airport.
Now that is the American dream!!! They started off as hourly employees and are now franchise partners. Covid hit them really hard tho. They aren't getting the commuter traffic like they used to but that will pick back up eventually. I think they weathered the storm. We just need let the covvid psyop implode. The whole plan is to get us injected and connected to vaxx passports but that's another subject.
When I used to be a manager. I love hiring elderly. They are grown up and mature. They have been through it all. They love their job and are happy. There's nothing better than coming to work and your employees are happy.
We had a small argument over a year ago and I did take your advice in the end on amazon trucking business. Margins were not good and the policy’s as well. So, thank you. You were right.
You would of been better off getting registered under the FMCSA along with your DOT number, operating authority, and became broker, or freight forwarder.
Great information as usual for aspiring franchise owners. The restaurant business is so saturated that I wouldn't suggest anyone get into it unless they are at least second generation restauranteurs and grew up in the business. It's just too much work for too little money with too much competition.
Thank you for the comment!
I agree. I was a restaurant manager for many years before I bought a franchise unit in the company I was working for. I've been successful because of my prior experience in the business. I've seen so many people with zero experience buy stores and just go through the simple 6 week training course corporate puts them through. They don't have a chance. This business will chew up any inexperienced operator. So many have lost their investment and folded. These are stores that I know I could manage and make profitable but the amateur just walking on the scene can't do it no matter how bad they want to.
If you have money and want to buy a franchise but you have no experience in that business, you should find an excellent manager already working in that business and partner with them. Let them buy into 25% ownership or whatever split works for you guys and let them run the majority of operations while you learn what the hell you're doing. Learning won't take months. It will take at least a year and probably more like two before you can handle things like a pro.
If you never want to take a vacation ever again, and are willing to work seven days a week, buy a franchise.
this sounds correct
What are you talking about I’ve never seen or met my local McDonald’s or Burger King owner and yet their restaurant are open everyday
The key is to get management that you can trust to run the store when you’re not around. (Easier said than done)
A friend of mine growing up, his father owned 3 burger kings. And his mother (in his mother’s name, but father managed them) owned 2 Taco Bell’s and 3 pizza huts (one was a combined store). They were filthy rich, and they went away basically every other weekend. And had a beach house in Marthas Vineyard that they lived at the entire summer when school was out. Own one franchise, you’ll prob work your ass off and never stop. Build up to a handful, and you’ll never work again....
@@moviesjean23 that's why most of them are a total shit show
worked at a dunkin years ago and ended up working with the owner one night because the other baker called out sick...was a real eye opener he was cool and was telling me if he takes 10% after all is said and done he is happy.....not the money making machine you think...
Excited about a milk tea franchise I just bought. I believe I got the best location for starters. High traffic, low rent, check! Love from the Philippines! 💖
Fritzie Mae Millana Agor nice you bought this franchise in the Philippines?
@@arlenwiley4287 Yes. 😊
IF you dont mind me asking how much was the price to purchase it and how much is the monthly profit
How much you making? I thought about buying into a franchise in the philippines. Maybe pizza or coffee shop
Thank you!
I AM a Brazilian with a store in Brazil and another in Paraguay and your vídeos are a light for what i AM looking for the Future.
It gives me a benchmarking and a direction.
Thank you!
Thank you! I would caution that our videos are speaking to USA markets and may or may not apply to Brazil. I would hate to see anyone make a bad decision based on erroneous data :-)
Open an Evangelical church: the service is the promise of another life in Paradise (and nobody ever came back to complain that it wasn't true).
You'll pay no taxes.
Consider that.
Im interested in opening a Brazilian chicks franchise here if you could supply the product.
If i have over million dollars I'll never get into service or food industry.
I'll go into manufacturing
Tons of Subway stores closing.
Because you can open one and I can open one right across the street with no company restriction. Too Many in one and weird areas.
Full proof the company is ran by a idiot
Same in Brazil.
Blah 🤮 Same old Nasty sandwiches all the time. 1 word: Boring
A friend of owner a bunch of subways and has slowly been selling them. They don’t make much anymore. And I think the market offers so many other “healthy” fast food options. Subway never really evolved with the market and trends.
I had no idea the take home for owners would be this low. The margin for error is tiny. Your expenses are off 5% and you could totally lose money.
Do your math - many franchises are designed to make CORPORATE rich, not you, you are essentially signing up for a glorified job.
I was a manager for the largest and highest gross revenue carpet cleaning franchise in the Midwest for it's respective franchise.
I ended up leaving that job in 2018 after realizing I could start my own cleaning company and putting the same energy into it, make 3x the money I was making running 12 trucks and 25 technicians....with just one truck. Don't misread what I said - I didn't say triple the sales of the previous company, I said triple my personal pay.
Better to work for yourself vs someone else.
nice! I love that
The successful franchises are the ones with good employees. Remember, who you hire can make you or break your store. Also don't let your landlord get the best of you. Get someone to help you negotiate your lease.
He gives the net profit, but doesn't talk about the owner's income? So MCD Nets $150K but what does the owner pay himself or is that included in the net? So we don't own a franchise, and we pay ourselves $150K as income and net about $75K for a total income to the owner of $225K (assuming the net profit is not retained in the company which in our case it is).
So when you buy a franchise find out what the average owner pays him or her salary on top of the net profit.
WOW!!! Just stumbled on this video, so informative. Wished I had this info when I opened my restaurant. I'll be watching for more advice. THANK YOU!!!
We appreciate the feedback! Thanks for visiting.
I said the same thing. I wish I had seen this years ago before I bought my franchised restaurant. The industry is very secretive and it’s hard to get straight forward information.
Dan Jenkins go to google.
Tube Tube I hope u didn’t pay for your equipment.... you can get free gym equipment and a free lease. Rent abatement.
@@danjenkins2064 honestly even though you saw the video it still doesnt convince you until you test the waters..i run a small.coffee shop..not.easy but i am.glad i never got into a franchise..iv met a few franchise owners and it qas.really.tough on them.they were looking for.small businesses and stay away from franchises
I had no idea what the average net was for most franchises. I was in business for 39 years. I did engineering product design and manufacturing. I always thought to myself, "I should have bought a franchise." I'm now retired, basically considered wealthy and so glad I didn't buy a franchise.
I really love the honesty you bring to the franchise space
I would imagine the "owners" are corporations that cut checks to the main shareholder. If you have 4 places paying you a $250 gm salary, you're making a million on a low risk business that can stay around for a long time. Chic fil a has the right idea treating owners like employees.
Owners aren't employees
Buying an existing franchise saves a lot of money but you are inheriting their problems and that is usually why they are selling it. If you have experience fixing one such location then you do it again and again until you have a handful of locations.
I’m a GM and my owner is KILLING it.
Wow, these numbers are terrible! I think I’ll stick with stocks and mutual funds, which give me the same or better return with no time and no work required.
You may want to check your stocks over the last couple of days! Franchises also provide a saleable asset beyond immediate income that are not available with stocks. Thanks for the comment!
Franchise City my plan was to but papa johns 3 stores built them up and by year 5 sell
All of them was it a good idea?
@@FranchiseCityOnline Stocks is the way, owning franchises is more like giving yourself a purpose on a daily basis, its important for most people. But the profit still gonna go to stocks, that's my situation atm.
@@kaydens6964 Time will tell! Thx for the comment.
@@FranchiseCityOnline Thanks for your videos. Honestly if I want to invest millions In MacDonald, I’d definitely buy their share instead of a franchise. But everyone has their own strategies.
Gross numbers are great, but the bottom line is what you want to focus on. My firm (My Franchise CPAs) works with one franchisee grossing over $1M in sales (single unit), but netting just $90K. Another grosses $700K and nets $370K. Both are painting franchises, but one is much better at managing costs than the other. So when looking for and picking a franchise, don't be deceived by the gross number. You need to really dig in to understand the bottom line potential of the franchise before making a purchase decision. ROI is also an extremely important figure to pay attention to. What are you getting for what you're paying on the front end?
I wish I had more time to watch more of these. They are incredibly done one of the best videos on the internet as far as I'm concerned. I spent 40 years working in the shipping industry, and I am so thankful that I didn't try to do a lot of the things that are warned about in these videos. These are all game changers if I was young and going to do this I'd be knocking on your door in a heartbeat. I am actually very sad that when I need expertise like this another Fields I can never find it. Keep up the incredible work thank you very much. I obviously can't say enough good things about what you do.
Appreciate the kind words thanks for the support!
Someone who works in the Home Care Industry: The Fastest way to go under with a Senior Care business is: Not staying up top of training requirements, state and federal law. This is one instance you want to pay someone VERY well to give a shit about training requirements, laws, rules and regulations.
Blue Jedi I’d never want to be in that business. Most of the staff are going to be problems. It’s a low paying job that is doing very important work. I’m sure its hard to find anyone who is good at it, responsible, and compassionate.
And covid restrictions create oppressive prison like conditions for residents and staff
Hi! Loved your video. I couldn't agree more. I am an Australian franchisor and have a mere 24x franchisees with a 100% success rate to date. I'd like to thankyou for expressing your professional advise on franchising and if I may (as a Franchisor myself) I would like to offer some additional information for people to consider before buying any franchise, anywhere in the world. For example ... Our franchise ... has a turn-key buy in price of $100k AUD It is a mobile service/"man in a van" type franchise. And excludes a vehicle/vehicle lease. Our franchisees make more than the big food retail outlets taking home after tax (on average) $100k AUD/year with a complete return on their initial investment in the first 6-12 months (on average). So if you could part way with $100k for our franchise or $350k on a Subway franchise and on average take home only $60k salary(with Subway) ... both of which require you to work hard in the business , then the choice is obvious. Now I know that our franchise is specific and not everyone's cup of tea. In our business you have to climb onto a roof and some people may prefer to just make sandwiches. However as an entrepreneur and having been exposed to many, many different business models I can see just how backwards some of these franchise brands operate. They lack innovation. The brand's HQ absolutely needs those exorbitant royalties and fees from their franchisees to survive but as a compromise they are starving their franchisees. I could write a whole book on this ... lol ...I would urge any franchise prospect who is considering buying a franchise that you buy into a franchise brand that has genuine innovation and is very transparent on the real numbers of their franchisees, including the lowest performers/units!!! Don't get caught up in clever marketing! As an example.. when we grant a franchise we want the prospect to fully understand the differences between our highest performers on $250k + income and the lowest on $70k take home income and why those numbers are what they are .. e.g is a franchisee choosing to only work small hours / put small effort in by choice because perhaps their partner has a high paying job?? But no matter the case, we invite the prospect to speak with those particular franchisees personally; to back up any information we are giving them and want them to make a comfortable, sound decision based more on logic rather than raw emotion and the illusion of what "real life business is not". I know this may be opening up a can of worms but transparency is what we believe in. Another example is..our system even allows all our franchisees to see and openly share their results and marketing performance and inner operations, so they can see how each other's business is doing etc.. WHY you may ask! Because our franchisees don't compete with one another!!! This is one of the biggest problems in franchising... too many units/saturation of a brand in too small a territory and lack of support!! I speak with some personal experience here. 18 years ago before I franchised TV Magic, I worked for a company where I only got to keep 30% !!! It was okay for a while, until then it became very demoralizing. Now, another point I would like to make is when we are marketing our franchise opportunity we make no illusion about "buying yourself a job". In reality, our franchise is like all other business startup. Whether you are an MLM business or you buy/inherit a business you are literally:- "buying yourself a job". If you truly are an "investor" and you are buying a self managed, automated business then you already know all this and I am not speaking to you - congratulations. However to the millions of people who dream of having their first business or are just starting .. when you have your first business don't be fooled by this illusion! Any business start up will require you to be there for your business in the beginning because no one is going to do it for you! Our franchisees were under no such illusion when they first met us or when they first started. Unfortunately, the definition of "passive income" is very misunderstood and quite often is only smoke and mirrors. That's not to say that any successful business doesn't have plenty of perks (when compared to being an employee) and passive income is not possible! But be careful if you are starting your first business and you have this idea that you will have enormous passive income and retire in 5 years time! Well that's my two cents worth of advice :) Oh and we're coming to the States soon! If you want a great opportunity, look at any brand that is a moving train and has low #'s !! Getting in early is key! Thanks for the video again. Cheers mate :)
As a huge KFC fan would love to know more details about a franchise costs/yearly numbers. Very interesting information, I really thought those fast food places were making tremendously big profits but you've really cleared the misconception about the real numbers. So food its a lot more costly to get off the ground than other areas of business. Great and very appreciated video highlighting the myths about businesses. Thanks!
In my twenties I used to want to own a restaurant but then worked in them for 10 years. The only way to make it as a franchisee is by owning multiple locations. Between employee theft, poor location choices you would be left with a few Ideal stores that actually generate profit. It's a tough business and things are not what they seem.
Can never believe the amount if money that business report. A coworker wife rented a space for think it was around 40 kid day care center. He would lease a $55.000 fancy pick up truck every three years and wrote it off because he done the maintenance on it. At Christmas time they purchased a $1,000 of $25 gift cards that they wrote off as Christmas presents but keep every one for themselves. At my first job owner cried the blues during contract talks. Said he was only making a very small profit. His wife was the president of their leasing company and received a $50,000 salary ( 50 years ago so now would be over a quarter million dollar salary ). The office did all of the paper work. All she did was sign around 100 owners cards a year. She get a top of the line new Cardiac every two years .Their no show sons & a daughter were also making big bucks for doing nothing.
How is all this wisdom/knowledge/facts/information/insight/honesty available for free? Damn. Thank you. Subscribed with a quickness.
its not . The video is an advertorial for Franchise city's expertise so you spend money with them. Nothing is free.
I have no interest in owning a franchise, but this channel is so informative and interesting.
WOW! this is very enlightening. I used to think fast food businesses were the best form of franchise.
Thank you for watching!
Franchise City, Thank you for Sharing your Great Body of Knowledge, of getting, our hands, on purchasing our own Franchise., 👏👏👏🔥🔥🔥💯👍
The hours and investment from people who I have known ,don't advise a restaurant or franchise.There are people who have done well but you need so much to make it all work.
Great channel with lot of free information and it also inspires potential business owners
Going over the definitions for accounting terms in another video thank you! I “thought” I was going to earn a degree in business administration.
Accounting gave me a migraine so bad I thought It would lead to a aneurysm. 😂
It’s a foreign language to me. Thanks for the people who do have the skill for this very important part of running a business.
Did you get the help you needed for the accounting terminologies? I am a cpa and yes I love numbers and want to make it fun for everyone 😁😁😁
After I bought a national franchise I started showing up to the meetings and they spoke a different language. I had to learn all their terms. I understood all the concepts but they called everything by a different name or 2-3 letter abbreviations.
When he said buy a job lol
That is a real thing
It's a common saying in franchising
Basically investing
I use to own 6 different franchises restaurants. subway,tim hortons,dunkin donuts,pizza hut,kfc,wendys each of the stores was in a busy location gross was very high but the net was around 32k per stores after paying employees rent food cost etc. So franchise is not a good idea if you want to make more than 30k a year.
What did you ended up going into that made more each year?
I know of small independent food businesses that make over $500,000 a year profit , so why would anyone buy a franchise business where they have no control over their own destiny .
Independent store owners can change anything on their own decisions such as menu , store interiors , their wholesale suppliers and pricing without having someone else telling them what to do
Thank you for sharing some valuable information that worth gold. You really covered a lot and just made more of understanding of the differences.
Thanks Hassan!
Has no one noticed that at an average volume of $2.8 million a year a McDonald's owner netting only 10% makes $280,000 a year? Now own 3-4 stores, do the math... : )
It is very important to consider franchise fees and royalties! I recall a lot of Dunkin Donuts franchises in Kansas and Colorado pulled the plug in the 90s and became independents. Perhaps they looked at the franchise fees and decided that once you know how to make donuts and can find other sources for ingredients through Sysco, US Foods, etc., what you were getting in return for the fees wasn’t worth the cost, e.g. national advertising wasn’t bringing in as many customers as promised, or coupons were too plentiful and cutting into gross. (Around 2004, all the DDs in Portland, OR closed, and many reopened as a local chain, but that might have been more of an issue with corporate ceding the Pacific NW to Starbucks, figuring it was too much to take on the coffee giant in their own backyard.)
The money is in owning the property your franchise is on. Stand alone stores make the money because of the low overhead.
Pretty neat, First view and first like great video guys!
Thank you!
You really have to have the desire to do this because most of the nets shown here can easily be matched for a college educated professional after only a few years in their field.
Differences?
Regular job:M-F 8AM-5pm, go home relax.
Franchise: After a 10-12 hour day, leave the store. The assistant manager has your phone # to call you at night with the "crisis du jour"
Wow. The algorithm finally sent me a good quality video. Well done.
It's absurd to state 'this is what a franchisee' will make as it's dependent on the value of the chain(goodwill) at any point, plus the environment(covid?) as well as the location. I've seen some units close down while others were (no doubt) making a pretty penny. There are some plum locations like airports and big cities, even with steep rents, where the franchisee might make a fortune. Then there are the places out in the boondocks where they hoped they'd have a winner, only to close. This is why Subway did so well for so long: the risk in a strip mall to build was tiny compared to building a separate facility.
The title isn't how much do franchisees make, it is how much do franchises make. Big difference.
Here is my take on the Food chains vs. other franchises. During the corona lock down who was still open the Chick-Fil-A drive thru or the salon? Which service does one NEED to survive, the Food chain restaurant or the salon? During a recession or depression which one are you going to cut your budget on first, the Food Service or the Salon service? End of discussion!
I thought I wanted a franchise... until I saw this video.
This guy is good! He knows his stuff
I own restaurants don’t do it. Learn a trade they make all the money.
What’s are the risks?
@@jayclemons3071 Corona is one of them
Biplav Shrestha true the timing couldn’t have been better. But majority of the franchises are still open so, buying an already established restaurant might work
Jay Clemons
Coronavirus-19
That's right. Be the skilled trade fixing the restaurant equipment, profit!
Hey! Believe it or not, I have seen McDonald's, Subways, and Dunkin Donuts closed down in Queens NYC. Food industry is not that easy to run like you think.
Can you do a video about carwashes ?
that industry is a cartel. you kinda have to be in the know to do well.
My cousin runs a car wash says owner is replacing with automatic car wash because hard to find good workers. I would shoot for coin operated car wash
I would be very interested to see this
Have an A-1 day.
Here is what I heard that you did not say explicitly - To have a profitable business, go to these franchises and provide them with services they need. The low margins they make is kind of an indication of their expenses to keep the business going.
The basic rule of franchising is this : will you invest almost half a million dollars just for a $30,000/yr salary?
You could be the franchisor and have someone invest half-million instead, so you can collect a six-figure salary.
hope he make more of such vids explaining income of similar franchises like Jimmy John's, Wendy's, popeyes, taco bell and panera
its better to invest in real estate!! 7 cap prices usually go up and you leverage with the banks
Also with Chick Fila the owner have to work in it. Their are very few people with 2 Chick Filas and almost no one with like 3-5. They dont just want someone rich to be a franchisee. They want you to work and manage your own store from 40-60 hours a week. I’ll past. If im opening up a franchise, its to work less, not more.
It's to keep the quality standards of Chick-fil-A
X2 the comment about "buying a job". The numbers here also show the fallacy of many peoples' mantras about " owning a business and being your own boss". It is a lot of time and financial risk for not a lot of money.
Very good video. I own a franchise business and Franchise City was who indicated the right person for help me in the process! Happy customer.
Hey Gilberto! Thanks for the positive feedback. I'll let Jerry know :-) And congratulations on the new business!
I need to rethink my future
Thanks for Sharing
Hey Robert! I just wanted to say I'm a huge fan of your channel, it's really nice hearing someone give their take on some of the subjects you tackle who comes across as a legitimate entrepreneur and investor and not some random get-rich-quick guru trying to push their product onto me. I wanted to take a moment to thank you, thus far you've made videos on 2 separate suggestions that I offered and they were both very interesting and informative, I especially appreciated you going so far as to interview Banjamin Barry that one time, I wasn't expecting that AT ALL and the interview was extremely fascinating!
If it isn't too much trouble (and don't feel obliged to do this), I wanted to hear your thoughts on what it would take to develop a six figure passive income. What are the potential avenues to accomplishing this? How quickly could each avenue be realized? What are the advantages and drawbacks to each one? What would be the monetary investment required for each avenue? If a certain avenue you recommend peaks our interest, are there any resources you would recommend looking into that don't fall into the realm of get-rich-quick trash?
Thanks for the support and the kind words! We'll be covering more general business/ online businesses content on the new channel. czcams.com/channels/MlfXbdlKmfP8jNK4i8i9Ug.html I'll do an updated video - and we'll actually be starting an online business in real time this year so you can follow along to see if we crash and burn lol. True passive is not that easy and takes a lot of work out of the gate. Depends on the budget you have. If I had to pick - definitely an online business, possibly affiliate marketing, and likely high ticket items. I really like the review affiliate model, so where people (genuinely) review cameras, shoes, phones etc, then drive the traffic to an affiliate page or link. We have had had success in education and fitness, but there are so many niches you can pick one that you like. Build a blog, index some videos, do social media and build a name. Its not really 100% passive but doing a video or blog post here and there doesnt take much time. Once the pages/videos are indexed it becomes more passive but by then you are addicted and will want to push out more content :-) For motivation visit some of the brokerages selling online businesses -(quietlight/flippa etc) these are people who built a drop shipping/ affiliate/ biz from zero, and are now selling for 6 figs or millions. If you have the budget some of these are semi-passive businesses that can be acquired. Definitely do-able, people are doing it - why not you!
As much as I love food, I'd rather invest in a service industry rather than food because of the low overhead. With food, there's expiration dates, great waste, random inspections, pest control, bad employees can ruin a business that cost the owner over $500k to establish and when you're locked in a lease then you run on losses. Barbershops, salons/nail spas seem to be the best bet.
Senior care of child daycares seem profitable but also lots of liability as you're dealing with people's lives either too old and frail or too young either way your employees can easily ruin it and get you shut down.
Great points!
Wow, this video is awesome. I really appreciate you taking the time to put this together.
Thanks for watching!
3 mil to open a BK and 95k/yr in profit. So it will take 35 yrs to break even minus real estate cost. How does that make sense?
It doesn't. Keep away from any Franchise, especially in the food business. After 10 years, I let the lawyers terminate me...best decision ever!
Current Affairs already warning people of the dangers of franchisees bury in debt. At least you're earning that sweet advertising $$$🤑🤑🤑
I had a friend who owned three Subway locations. He had to own three just to make a decent living. The old franchise agreement stated no Subway franchise store would open within X km radius of the other store. Increasingly that was radius rule was decreased because you have Subway shops all over now. One store only brought in $32 k per year.
Great information. I couldn't agree more. As a cpa serving small businesses I see it all. And you were right on the money. I do see from the senior care to subway franchises. That's why I've developed accounting and tax 101 classes online for small business owners. I educate all Biz owners or start-ups before they take the decision and empower them to stay close to their numbers. I call it Love your Business numbers... This is the name of my CZcams channel. It's all about numbers 😁😁😁
So there is a 0% chance I will ever buy into a fast food franchise. Based on the risk vs reward, why would anyone do that
Good video... someone would be better off getting a $40,000 a year job and keeping their $200,000 instead of operating a subway franchise
My wife and I owned and operated a Dairy Queen for 10 years in a small town of 10,000 people. You hit the nail on the head about making $50k a year. The spring and summer months were profitable but November through February was difficult and stressful. In the month of December__you'll have 22k coming in and 29k going out. Dairy Queen still gets their 9% for advertising and licensing. We sold it in 2004 and never looked back.
Thanks for the comment! Glad to hear you were able to "escape" :-)
Great video. I love the breakdown
i missed this channel , alot pls do more cricital reviews and why u wouldnt invest in a franchise
Concentrate on hiring good professional people with good attitudes. That's the key to Chick-fil-A's success.
One million supporters for this you tuber.
Amazing! Never thought I'd be finish watching this video!
I appreciate your video, (i've been in franchise development for 20yrs) but you only shared net profit for QSR. You didn't share profitability of Cleaning, Senior Care, or Staffing, - only shared the investment and sales. So,.. providing and comparing sales of the different categories is useless without comparing profitability. Just like your example in the beginning of the video about a franchise doing $10M in sales but had $11M in expenses. And don't forget ROI and NPV. Some concepts have ludicrous investments that thwart reasonable return on investment. Just my 2 cents :)
Thanks, Great information (from someone who learned the hard way!)
Thanks for visiting!
very good information and very deep info. watched your first video and love it.
Franchisors often charge franchisees a percentage of sales, they don’t care whether franchisees make profit or not. It gets worse when franchisees are forced to carry promotional prices, which often are close to or even lower than cost.
How can a person put up a million and make 80-100k? Yowza-not for me. Majority of wealth in america is held in real estate. Real estate is more passive too. All professions have pluses and negatives.
I know it's crazy I rather buy real estate and make more. U smart bro
You would earn your investment within few years & the remaining earnings are bonus. So it's not a bad idea at all
The head office makes $ millions of dollars and royalties . 😊
All that risk and a strong service advisor at a car dealer makes more than a mcds owner. Lol. I’ll hold my low risk thank you.
I assume the numbers given for profitability are based on the store having a general manager in place. Most single store franchisees manage the store themselves and keep that money.
I think something else to realize in the video - if you work in your store, you obviously make more money because you are part of the *labor*. So if a Subway makes $41,000 net profit but you as the owner replace the labor of two $12 per hour employees (because employees tend to be inefficient) you made another $48,000 as a full time employee. You also saved money on labor, costs, taxes etc by working your store.
So you can make a six figure income by being an OWNER OPERATOR.
only then they can make lil profit,,,,everyone does dis,,,,,,but u have to hire so many ppl .....one person salary $ 25000 per yr if u hire 4 ppl $ 1 lac,,,,rest misc expences,,,, at last u realizer u ain't making gud money ,,,,,,thats y most frenchise owners are unhappy ....actully they dnt get much as u see,,,,,,