Okay, Some days ago, I was looking at the cost of owning a McDonald's Franchise (I often get thoughts that are random, especially with business, politics, and Blockchain). Well, this came as a result of tasting a very awful Burger from a stand which a friend got for me in a try to get me out of the current depressed state I was in. After tasting the Burger, I must confess that I came out of that state for a while because the Burger tasted pretty bad (I am sure they did their best). With this, I got thinking, what would be the cost to own a McDonald's Franchise.
A company founded and operated by Richard McDonald and Maurice McDonald, which was later acquired by Ray Kroc. Well, I am not in to tell the story of McDonald's, I am here to look into how to become a franchise. If you must know, McDonald's is one of the Biggest brand in the world with over 37,000 stores in 100 countries, and being the second-Biggest private employer around the world (including you the Franchisee.... anyway, just joking), so this must tell that it is in for business and not joking around. Owning a franchise will surely cost money.
Owning a Franchise means you are your own boss, but you represent a corporation so first in the money part, I will say $500,000 is a good start when it comes to personal finance but it can go up to $2,000,000. Once McDonald's see that the individual is financially capable, then the next option is allocation of restaurants, of which McDonald's will require the Franchisee to pay 40% upfront before the commence of business. Before opening, McDonald's ensure that the company's quality control are met starting with the Logo, the environment, and especially the kitchen. Before opening a franchise, every franchisee will undergo a 12 to 18 months training.
Upon opening, the franchisee will be paying for rent as well as a 4% charge depending on the sales made. The Burger must be done in the right temperature, the fries done well and so on. Mc Donald's also allows for innovation, but the innovation is at the cost of the franchisees, as they pay for whatever equipment that will be used. For every upgrade you see in a McDonald franchise, the franchisee pays for them.
Although prople eat Burger on a daily basis but then, are these charges and fees making a franchisee profitable or are they just rip offs?