Quote:
Originally Posted by bjornb
Not much point owning a Dominos when you can just open your own pizza place. There are thousands of pizza shops in a big city but no one can replicate McDonalds.
Most people I know do not want to chance it on some random pizza place when they want pizza. They order from Dominos/Pizza Hut because it's predictable and very often better than the local stuff. (Depends on the area, obviously. Some places like NYC, NJ have tons of great pizza places.) THIS is why these two companies dominate the national pizza sales volume. There is real value in carrying their name. Additionally, Dominos has lots of other stuff too. Hot subs/deserts/etc... mostly pretty good. And they have each product cost and formula down to a science.
IF I was interested in buying a franchise (and had the money, lol), I would resist the temptation of buying whatever is hot in the last 3 years. It seems like there is a pretty decent boom/bust cycle for these "novelty" franchises that have some random concept and a business formula that hasn't been proven by decades of success. One year, they have lines out the door and three years later they're closing their doors. This is why I would rather buy into a MCD/Subway/Dominos. It is hard to screw up burgers, sandwiches, and pizza. All 3 will be in high demand forever in the USA and with the franchise support/suppliers you should be able to do better than random locals starting their own burger/sandwich/pizza places.
But ultimately, I am concerned with the big cost of franchising and how they seem to take a cut of everything...
There are industry coaches/consultants that you can fly out to help you start your own X restaurant and I think this is money better spent. A pizza place expert can analyze your location, food/etc costs, menu strategy, etc to guide you in the right direction. And if things are going poorly, you can consult them to solve your problems. This seems like a better way to go. That's what I would do instead of a franchise, unless there is some buy-back provision if your franchise is not doing well.