O/T Anyone Own A Franchise?

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josh6718

Pharmacist
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So obviously this thread is off-topic, but was curious if anyone here either owned or knew someone that had purchased a franchise? I've been considering buying one as a career option out of pharmacy, but wanted someone's personal insight into it.

One of the big barriers seems to be the upfront cash, but depending on how successful the franchise is, I'm assuming would be able to have a shorter return-on-investment timeframe?

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Only knew food franchisees, not hotel ones where those can really make a bit in a good economy.

Obituary: Paul Najarian, business owner

Popeye's
There's a couple of physicians who own the Popeye's franchise in town. Long story short, the entire point was to give his useless son a job, and then he died supposedly of ALS early. Fairly high buy-in costs, business insurance is a PITA, hired a management company to do the real work. Probably could have made more elsewhere, but as stated, making lots of money wasn't the strategic goal.

McDonald's
Only know the manager to franchisee option where one of my high school classmates did that. He still works 70-80 hour weeks as a three store franchisee, but nets somewhere around the $2.2M range annually to himself after all considerations. The hardest working guy I know, was a scholarship boy, and that's considering that a good number of my class went on to be lawyers, advanced surgeons, and I-bankers. Worried as hell though that McDonald's will eventually go under do to Millennial eating habits.

Burger King
Really sad story in the Midwest, they all went totally bankrupt, and some hedge fund owns them all now.

Subway
Some nurses built the one next to the hospital I trained at (5 of them pooled something like $350k in 2006 to do it). One of the spouses was a CPA who manages the chain around the area. It makes money, but not as much as being a pharmacists, and everyone is worried about the bottom falling out. Has a homeless bum problem, since it's near the Central Library as well, and the store's been trashed a couple of times by druggies wanting cash.

So, you tie your fortunes to the mother company, for good or bad. There's a serious upfront cost, and you might even have to compete against company stores. But, it's changing one side of work for another, very few franchising companies allow a passive management owner, the mother company almost always has a buyback clause for those situations as they want you to put up with the risk too.

If you're a pharmacist, I'd recommend transferring in a retail setting to front-end to learn the work involved in managing a store on the company dime. More than one of my aunts and uncles run a bunch of pharmacies in town due to front-end management training in Walgreens and Osco as a paid education.
 
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I thought this would be a thread about Medicine Shoppe.

With any francise, the big barrier isn't the upfront cost, it's finding the right location. I think many franchises will give some advice on that, but finding the right location is the biggest determinate in whether your business thrives or fails.
You have to find a location that doesn't have a a lot or any options for what the franchise is offering.....and this location has to be in a market base to support it. And, then one must find a good location for sale for their franchise.

IE with McDonald's....pretty much every place that has a population base to support a fast food restaurant, already has fast food restaurants. If you find a small city with a Carl's Jr and a Burger King, it's probably going to be hard to get a McDonald's to take off there. Now if it's a small-medium size city, maybe, if you can get a more accessible location than the Carl's Jr and the Burger King (but most likely, these business already have taken the best location.)

Now, maybe you find a medium city that has Carl's Jr, Burger King, and McDonald's. You might possibly be able to make a go of a Popeye's, since it would be offering something different. But most likely, someone else has already thought of that and opened a Popeye's.

So where you are most likely to make it as a new franchise owner, is if you can find a place that has a failing business due to poor management or something, then you might be able to lure away enough of their dissatisfied customers, that you could make a go of it.

The other thing to consider is the huge time commitment. Sure you can hire other people to run your franchise, but then there won't be much profit (if any) left for you. And you still have to be involved in what is going on, as well as misc employment issues. You still have to check that things are being done correctly, because you will be the one responsible if they aren't. IE, you can just hire a manager and accountant to figure out the taxes, you are the one signing off on it, you are the one who has to know if the numbers are correct. You also can't just assume that the manager is enforcing all applicable health code laws, because you will be the one paying fines, or dealing with loss of customers, if the manager starts taking short-cuts and you end up with a failing health code violation. If you don't mind working 2 full-time jobs (I'm assuming you will be working full-time as a pharmacist), then it might be for you. But if 80+ hours for potentially years on end doesn't appeal to you, then you probably aren't going to want to buy a franchise.
 
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