Question

The owner of a fast-food franchise has exclusive rights to operate in a medium-size metropolatin area. The owner currently has a single outlet open, which has proved to be very popular, and there are often waiting lines of customers. The owner is therefore considering opening one or more outlets in the area. What are the key factors that the owner should investigate before making a final decision

Answer 1

The key factors that the owner should look at are:

1. Estimated budget for opening the new restaurant. The owner has to pay for each franchise restaurant, plus the equipment, furniture, and rent.
2. Target market and potential demand. The restaurant current demand is very high, but will it be high if another restaurant opens.
3. Location is extremely important for any business, and a restaurant is not the exception.