My dad has a franchise of 5 months that is already starting to fail. He has 250k+ put into it, and thats with a shared business partner (500k+ total.) It is located in a great plaza of food and grocery, BUT there is another boba shop 2 minutes from it. I dont know why they chose to build one so close to it. By the end of the second month things started to go downhill and getting worse and worse, only making average of $100-170 dollars a day with $135 dollars needed to pay workers hours for that day. Is there really any way to save this business? Sell the business? Bankrupcy? Any advice helpful
He needs to cut his losses and get out. LPT: Never buy into a franchise business. I run a very successful handyman service for 4 years now. When I started I looked into Mr Handyman which is a franchise company. They wanted a $59,000 initial franchise fee, then a 7% royalty fee in gross monthly sales, then a 3% local marketing fee, 2% advertising fee, a computer usage fee, a 1-800 number fee and on and on. I counted 22 different fees to pay them. I took $800 and bought a basic set of tools, spent $12 a month for a website and $100 for a few road signs to get started and now I have many customers and I don’t need to share a penny with anyone. Mr Handyman even want to train you how to hire people so you can manage the business. This is idiotic because never though I do well. There isn’t and never will be enough business to hire our work and sit in an office.