Business Franchising Tips

Franchising is allowing one party to another party the right to use its trademark or trade name  as well its business system and processes.  Business owner offer their business franchising to expand their business at a fast pace. Franchisee or franchisor is the one who owns the overall rights and trademarks of the company and allows its franchisees to use these rights and trademarks to do business.  The franchisee charge a franchisee fee for the rights to do business under the franchise name.  Also, the franchisor collects an ongoing franchise royalty fee from the franchisee.
Business franchising is considers one of the safest and risk free ways to start a business but it cost a lot of money.  These amounts of money are worth it if you choose a right business franchise according to your interest.

The following are some tips before franchising a particular business

  • Research the best franchise.  It is important to do a research because there are thousand of different business franchises.  Ask existing franchisees and customer to gather information and seek advice from friends, relatives and colleagues to determine the reputation of the business you want to franchise. Also, research for the local market to know the demands of the products or services you would like to offer.
  • Choose a franchise that you will enjoy.  Most business is successful because the owner of the business is very passionate.  If you are interested in your product or services, you will learn rapidly.  Being an expert to your business is important to running to any business.
  • Make sure that your franchise has a good profit model.  If there is a good profit model, it is easy to start up, run and maintain a successful business.  Business with reputation and strong brand names usually have a stronger profit model since customer pays higher price to receive best and trusted product or services.
  • Look for Integrity.  It is important that the business you want to franchise has integrity. It means that if your business is with high integrity, your reputation will grow and shines.
  • Make sure to understand contract clearly before signing it.


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Elements of Feasibility Study

A feasibility study is written to present a problem or opportunity to be studied to determine if the proposed solution or business is viable. It includes the analysis of the current situation, requirement description as well as the evaluation of all alternative solution and the course of action.  Feasibility study can be applied to any kind of project so that you will determine if the project will be implemented successfully.  Likewise, feasibility study is important in business planning because you will know if your prospect business will be profitable or not.

The following are elements of successful feasibility study:

  • Executive Summary. It contains the overview of the project so that investor will be able to know the proposed solution or project without reading the entire documents.
  • Problem Definition.   This section will state the problem intended to solve as well the short description of the proposed solution or opportunity.
  • Current Analysis. It contains the understanding of the current system or product being implemented.
  • Requirements. It provides the requirements needed of the proposed solution.
  • Methods or Approach. It provides the methods or approach to be used in your study.
  • Cost.  Discuss the budget of your proposed solution. It includes the sales forecast and profitability as well as cost benefit analysis.
  • Evaluation.  Evaluates the solution being proposed.


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Components of Feasibility Study

First of all I would like to define what is feasibility study? Well, a feasibility study is written to find out if the chosen project is feasible before investing money. Feasibility study will determine if the proposed venture is profitable and viable and also to study the possible risk that will encounter during the implementation.

The following are some of the components of feasibility study.

  • Project Description. It contains the project name such as the name of the enterprise as well as the purpose of this business venture. You must also include the information about stakeholders and the end result expected.
  • Goals. It provides the list of your goals and procedures needed to achieve these goals.
  • Timetable. It should have the estimated time to complete the project.
  • Cost and Budgeting. All cost must be included such as all cost incurred for the project.
  • Market Analysis. It provides if the proposed project or business venture has a demand. It includes the market assessment such as the industry description and competitiveness as well as the market potential and sales projection.
  •  Technical Analysis. It contains the competiveness of technology and it identifies the constraints and limitations of the technology.
  • Financial and Economic Analysis. It details the capital requirement to facilities, equipment and inventories.
  • Resources. It identifies all the resources needed to complete the project including the technical, inventory and human resources.
  • Process. It contains the project flow such as the flow charts showing project stages.
  • Teams and Management. It includes the organizational structure and team management teams. Provides the staffing structure of the proposed business.
  • Conclusion.  It contains other alternatives and compares these alternatives based on your goals. Outline the criteria for decision making.


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Steps on Franchising Dunkin Donut

One of my friends suggested me to franchise Dunkin Donut that’s why I want to share my gathered information on how to franchise Dunkin Donut.

The following are steps on Dunkin Donut Franchising:

1.    Application

Of course, you have to secure an application from Dunkin Donut.   After reviewing your application, the Dunkin’s Donuts franchise team will contact you.  Then a Franchise Disclosure and Qualification Package will received and reviewed. This will provides prospective franchisees with information about the franchisor as well as the franchise system and the agreements required. Also, you have to provide proof of citizenship or Permanent Resident/Alien Registration care, proof of assets and they will check also credit and initial financial review.
2.    Business Plan

After initial screening, you will be met by their Franchise Manager.  They will conduct due diligence and talk with the existing franchisees.  Then, select a territory and make a business plan.

3.    Financial Reviewdunkin donut

After background check, the business plan will be presented to Franchise Manager and submit legal entity documentation.  Also, conduct a financial review based on business plan then receive a franchise approval.

4.    Approval

Sign Store Development Agreement (SDA) and if approved, they will begin franchise training and select and submit site for approval then secure financing.

5.    Grand Opening

After the franchise approval, they will finalize the lease or purchase and you will have to sign the Franchise Agreement then start the construction and crew training.  Then, the store opening.

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McDonald Franchising Requirements

Many businessmen and entrepreneurs want to franchise a business that is established already.  There are many franchises available and all you have to do is choose the right for you.  McDonald is one of the prestigious companies who offer franchising.

The following are the requirements for franchising McDonald’s Restaurant

•    Financial Requirement

  1. Initial down payment of 40% of the total cost for a new restaurant and 25% of the total cost for an existing restaurant. This down payment should come from non-borrowed personal resources such as cash on hand, securities, bonds, business or real estate equity and debentures. The minimum amount for a down payment will differ depending from restaurant to restaurant but generally, they require a minimum of $750,000 of non-borrowed personal resources to consider you for a franchise.
  2. McDonald also required the buyer to pay a minimum of 25% cash as down payment toward the purchase of a restaurant while the remaining balance of the purchase price can be financed for a mcdoperiod of no more than 7 years.
  3. There is an on going fee to pay during the term of franchise such as the service fee and rent. The service fee is a monthly fee based upon the restaurant’s sales performance while rent is a monthly base rent or percentage rent that is a percentage of monthly sales.

•    Other Requirements

  1. Business Experience. A person who have established successful ownership or management of multiple business units.
  2. Business Plan. Develop a business plan
  3. Manage finances well. With thorough understanding of the business financial statements.
  4. Training. Should complete a comprehensive world class training program in all aspects of operating McDonald’s restaurant business.
  5. Management Skill.  Should personally manage the day to day operations of the restaurant business.
  6. Credit History. With good credit history


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Franchising Business Opportunities

Many people todays thinks to put up business.  It is hard to think of type of business that will be profitable. But of course, definitely many people are a food lover that’s why more and more businessmen open a food business.

food cart franchisingLet’s see some of available franchising business:

  • Santino’s Pizza.  This franchise opportunity is one of the best for starters. It has over 50 outlets available nationwide. Their menu is easy to prepare and their pizza is very affordable for just Php25 per slice. There is high revenue potential. It cost Php280,000 in capital for 2 year franchise contract plus a Php50,000 as refundable deposit and another Php5,000 monthly support.
  • Adobo Connection. They serve different varieties of adobo, considered the main dish for all the Filipinos wherever they may be. This fast food chain requires around 4M to 6M initial capital. The company trains the manager and staff of each store to ensure that each franchise will become successful as the rest of Adobo Connection locations.
  • Lady Christine’s Baby Back Ribs. At first, this restaurant is designed to be a take-out counter but after a proven success, the owner decided to transform the business into a restaurant. Their menu is a mouth-watering baby back ribs.  The cost of franchise is P500,000 to 1 million depending to the type of franchise.
  • Pizza Pedrico’s. It considered as certified franchising success because it has been dominating the market for foodcart pizza businesses and it has more than 300 food carts and kiosks scattered nationwide.  The pizza they served contains four varieties such as cheese, ham and cheese, chorizo and cheese and sausage and cheese in one box. Filipinos enjoying the 3 flavors in one seating. The cost of their franchise is around Php400,000 which includes the food cart, initial supplies, basic equipment, utensils and marketing materials.
  • Lembest Lechon. It serves lechon manok which considered one of the most popular foods here in the Philippines. Filipino people loves lechon manok that’t why there would always be enough room for more lechon manok businesses in the market.  The initial capital investment is around Php400,000 to Php500,000. The owner assures that return of capital is possible faster than expected because the expected monthly income of each franchise could be about Php30,000 to Php150,000.00


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Jollibee Franchising

Jollibee is one of the famous fast food chains here in the Philippines.  Entrepreneurs and businessmen wants to franchise a stable business such as Jollibee that’s why more and more are inquiring how to franchise Jollibee restaurant.

Here is some information on franchising Jollibee:jollibee franchise

  • Of course, the initial step is to fill up franchise application found in their company website. You can download this form.
  • After filling out the form, you have to prepare a proposal for application which include the letter of intent which contains the address of the proposed site with contact number and mailing address.
  • Also, a vicinity map of the proposed site should be prepared so that Jollibee Field Personnel will visit for the site evaluation.
  • Legal documents certifying the ownership of the site as well as up to date detailed resume will also be submitted.
  • Usually, the processing takes 2 to 3 months upon receipt of the application but it does not secured you as franchise owner because the support team has to evaluate the proposed location before making an approval.
  • The cost of Jollibee franchise varies depending the size of the store but it usually cost 15M to 30M which is $266,455 to $532,890.
  • The construction of store, kitchen equipment and facilities, air conditioning system, signage, and pre-operating expenses are includes upon investment of franchise.
  • There will be training that takes place both at the headquarters and main branch as well as on site once the store has been built and Is fully stocked and ready for operation.


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Example Proposal – Restaurant Business

An Example of a Proposal

Title: Establishment of a McDonald Branch Along Nicanor Reyes Street Sampaloc, Manila

restaurant proposal
Date: June 25, 2007
To: FilipinoTraders Inc,
FromL Cormegmar Economic Consultancy
Subject: Establishment ot a McDonald Branch Along Nicanor Reyes Street Sampaloc, Manila

Part of my job as public relations director of CORMEGMAR ECONOMIC CONSULTANCY is to propose to big business establishment s an expansion of their business interests. Having been notified that your company plans to engage in anther business venture, I offer you with optimism this proposal

The food centers at the university belt could not accommodate all the customers especially during peak hours, the area being thickly populated by students, professionals and permanent residents.  Not one of the food centers merits a class A category, most of them being classified only as C or D. In fact, on special occasions, many residents go as far as Makati to dine with friends and loved ones because no food center in the place merits the occasion.

To remedy this problem, I propose that you choose the area along Nicanor Reyes Street for your business expansion.  This proposal details the problems, the solutions and the cost.

The Problem

With an 8.5% inflation rate, life is becoming more difficult each day.  This is aggravated by the 80% unemployment and under employment.  With this scenario, choosing a business and its location poses a problem among entrepreneurs.  Some of the major problems that may be met are the following:

  • Kind of business. What kind of business will one engage in?
  • Location. What is the best location for a business?
  • Cost of land. Where can one find the cheapest land?
  • Security. Is If safe to engage in business there?
  • Financial reward. Will one be financially merited in such business?

Businessmen should solve the problems.  They must be sure that their venture will be financially rewarding.

The Solution

The problems of aforementioned can be solved

  • Kind of business.  Man can forego almost every thing except food, it being necessary for survival.  Men have to eat and they do everything to fill in their stomachs even to the extent of stealing to satisfy their hunger.  This fact makes the food business rewarding.
  • Location. The best place to establish a food center is the university belt because of its immediacy to colleges and universities, hospitals, public and private offices and residences.
  • Cost of land. The Php 20,000 per square meter of land is comparative low since the current price of land in the area is Php25,000.  The lot owner will leave for the United States for good and the property has to be disposed immediately.
  • Security.  This is a major consideration of a business enterprise.  The McDonald Branch along Jose Reyes is very secure because of several establishments around. Policemen are assigned to secure the place on a 24 hour routine.
  • Profitability. The ten million population in Metro Manila concentrate in this area.  Statistics show that about two million live in the place.  Since food centers cater to people, McDonald along Nicanor Reyes St. will be the most patronized branch of the food chain.

The Cost

Establishing a food chain is not easy but the proposed center is not very costly as shown in the list below:

Land – Php40,0000,000
Building – Php 3,000,000
Equipments – 500,000
Total Cost – Php 43,500,000


This proposal has shown the viability of establishing the McDonald branch along Jose Reyes St. Sampaloc, Manila.  There is no better place than the U-belt. There is no better business than a food center. There is no better time than now.
I will drop by later this month to discuss any question you might have about the proposal.

(source: Technical Writing by Obnamia, dela Crys and Aquino)

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Business Proposal Letter Sample

June 11, 1990

Dataware Corporation
San Mateo Subd.
Pampanga City

Mr. Eymard R. Navarro
Kyla Grace Corporation
Cabanatuan City

Dear Mr. Navarro:

Our company would like to offer you a system that will cut the costs of your company by 50 percent.  Several companies proved that our products will reduce their expenses by 50% and I believe that this is also suited to your company. Our products will save money, time and effort.

We will evaluate your current system and determined how it can be improved your traditional processing of data and information.  We have helped several companies cut down their expenses such as on printing, personnel overtime, stationary cost, and many more.

The enclosed business proposal will show you the details of our product and how it will help your company. It also includes the works we have done for other companies similar to yours.

I am confident that we can come up with a plan that will help your company to save money. I assured that this will be the best decision to make more profit. I will call you to schedule our visit to your office and discuss the possibility of working together.

Very truly yours,

Joanna Grace Cruz

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Restaurant Proposal Ideas

If you want to attract more investor, you should write a winning proposal which shows that you know how to open and operated a restaurant business.
Your restaurant business proposal should provides your restaurant concept, market research, marketing plan, projects, start up cost, operating costs, budget experience and other support documents.

The following are some of the ideas to be included in your restaurant proposal

  • Cuisine and menu items.  Of course, your restaurant should have unique menu item and cuisine that will attract your target clients or customers.
  • Target Audience. Know the demand of your restaurant to marketplace and back it up with data and research.
  • Competitors – Identify your competitors in terms of restaurant business. You should have a unique selling strategy.
  • Pricing strategy – You should have your own pricing strategy that will attract your prospective customer.
  • Marketing strategy – How you will advertise your restaurant? Just include the type of media you will be using such as newspaper, website, TV, or social media sites.
  • Projection of monthly and annually figures. You can provide projections for the first three years which includes a loss or the break even income. Also, provides the annual profit projection and cash flow projection.
  • List of Start up cost. It includes the expenses to open the restaurant such as food costs, overhead expenses and other non-food cost.
  • Owner’s biographies. You should provide the key owners of the restaurant as well as the operators, staff member and consultants.
  • Requested funding. You can include the requested funding for your restaurant. Highlights the demand in the marketplace and the ability to operate a restaurant as well as profit potential.


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