Franchising Your Restaurant Business

Have you ever considered franchising your restaurant? Do you ever wonder if your diner could be the next Pizza Hut or KFC, or your burger joint the next McDonald's? In the United States, franchising businesses generate employment for an estimated whopping eighteen million Americans. Restaurant franchising represents a big player in this sector, so should you be thinking of joining their ranks?

One of the reasons given by business owners for deciding to enter into restaurant franchising is a lack of ready capital. When it comes to expansion, the main obstacle is always a shortage of investment funds and restaurant franchising provides an obvious advantage in this respect. As the franchisee provides the initial investment, growth occurs at a greatly reduced cost. For franchisors, investment in growth tends to be restricted to the development of franchising documentation and recruitment costs. Thus a considerable reduction in start-up costs is afforded in comparison with the typical sums involved in opening a non-franchised restaurant. Moreover, it is the franchisees who sign the leases and commit to the various service contracts. Therefore, restaurant franchising enables growth at a greatly reduced risk, with practically no contingent liability.
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