Franchise business can give individual the opportunity to start a business with an excellent chance of success at a minimum risk.
Lets take an example, McDonald, is a fast food restaurant and it becomes popular since many years ago. How does McDonald making money? By franchising, am I right?
Let’s take a very basic calculation:
One restaurant is selling 100 burgers per day and let’s assume the profit is MYR 1 per burger.
So, the retail profit is MYR 100 per day.
And assuming they have 100 branches, MYR 100 * 100 branches = MYR 10,000 per day.
Can you see the picture? It is a great idea that you are considering using franchising as a method of expanding your business.
As far as I known, Old Town and Secret Recipe are example of local franchisors so their fees are not as huge as McDonald and KFC. The cost of a franchise depends on the franchisor and the restaurant size, type and its location.
How Much Does A McDonald’s Franchise Cost ?
The costs for starting a new McDonald’s restaurant can be anything between MYR 1.5 million to MYR 3.5 million.
On an ongoing basis, your costs may include royalty fees which generally between 4 to 6% of your revenue. Besides, you need to pay advertising fees, legal fees, equipment maintenance, employee training, rent, insurance, and inventory.
if the location are good, the ROI is very fast
the catch of those international franchising is that they will only sell to reputable company. as far as i know, kfc/mcd franchise in malaysia is owned by a core company.
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