Skip Navigation
(P) 800.279.7569

3 Tips for When You Buy a Restaurant Franchise

3 Tips for When You Buy a Restaurant Franchise

To get the most out of franchising, you need to familiarize yourself with the industry first.

If you’re trying to get into the wonderful world of restaurant ownership, franchising may be a great way to get your foot into the door. There are plenty of benefits of going this route, including having a built-in marketing team behind your back and cruising off of immediate name recognition. That said, franchising isn’t as easy as it may initially seem. To get the most out of franchising, you need to familiarize yourself with the industry first. Here are three basic tips for getting started with buying your very own restaurant franchise

1. What Defines a Franchise?

First, you need to understand that not every chain is a franchise. Starbucks is an incredibly popular chain restaurant and coffee shop but it’s certainly not a franchise; each location is owned by corporate and operated by corporate. On the other hand, we can look at something like Applebee’s, where franchisees can purchase the rights to open and operate their own location. Some restaurant chains run a combination model where they have corporate locations and franchised locations. Franchisees have to pay royalties to the company they’re franchising for, but they also get marketing, brand name, menu design, and plenty of other perks in return.

2. Is Franchising Good For Your Market?

A restaurant franchise isn’t right for every location and demographic. Fast food franchises like McDonald’s, Taco Bell, or KFC may be needed in some locations, whereas fast casual restaurants such as Panera Bread or Applebee’s could make sense elsewhere. 

Take a look at the competition in the area. Is there another similar franchise already in the area? Would it make more sense to run your own independent restaurant that serves similar food as to what you imagined instead of running a franchise? This is where market research comes in.

3. Budgeting and Qualifying

While there may be systems in place to help you become a franchisee, it’s certainly not cheap, either. Many restaurant franchises are going to require that you have a certain net worth or liquid assets. Others also require that you have enough experience in management or somewhere within the restaurant industry, sometimes even requiring real estate experience. These are all huge considerations to make before deciding to become a restaurant franchisee.

Sell With Atlantic Business Brokerage, Inc.


