I want to create a restaurant franchise. What is the best way to get started?

Question

I have an awesome restaurant idea. I have a huge potential customer base for this idea, which is between 20-60 million Americans who have specific dietary needs that are not addressed on any menu that I have seen. Basically, I have the concepts for the menu items, which I think will really help out this group of people. I don't really want to run the restaurant myself, mainly because I have never worked in one and don't want to quit my day job. There are so many millions of people that could be helped by the ideas I have, but it is difficult to know where to begin. Basically, I want to get paid for my intellectual property, so I was looking at the idea of selling franchises. I just don't know where to begin. Can I sell a menu, or do I need a business plan? How do I pitch my ideas without having them stolen? Do I look for an investment angel, or do I take out a small business loan?

What is the best approach for someone who doesn't actually want to run the restaurant?

Answer 1

Hi Liz!

As you already realize, the process of actually owning and operating a restaurant is VERY involved and takes a significant amount of experience. There are, of course, restaurant groups (like "Lettuce Entertain You", among others) that own/operate/manage hundreds of various franchises all over the world... and perhaps one of them might be interested in starting a franchise based on your ideas.

The first step, of course, is to memorialize your ideas in some form of "tangible medium of expression". It's a legal phrase that basically means that you need to write down your ideas and get them onto paper and out of your head. Once you write them down, they're yours and you automatically hold a copyright in them.

The next step would be to create a business model around these ideas. You need to be able to show the management folks that your idea is a good one... that it would be of interest to a great portion of the population... and how it would be different than what is already available. A Business Plan is the typical method to explain these details. There are even a variety of business schools around the country (check at your local university that offers an MBA program to be sure) that have students who need practice writing business plans and will help you for sometimes no cost at all.

With your business plan drafted, and after practicing your "pitch", you would now be ready to sell your idea to the management company. To protect yourself and your ideas, you'll want to have a Non-Disclosure Agreement (NDA) drafted and signed by you and the management company(ies) that you talk with BEFORE you share your ideas. The NDA means that each party can share confidential information with the other and that sharing doesn't give the receiving party the ability to use the idea without compensating the other party.

Hopefully, if your pitch goes well, the management company will like the idea and will want to use it as a way to create a new restaurant franchise.

Alternatively, you could always seek outside investors and experienced restauranteurs and try to open the first restaurant with your new menu... but that is much more risky ... even if it might actually be easier to accomplish.

Good luck!

Answer 2

You've got a couple issues here -- starting a restaurant & starting a franchise. Let's tackle one at a time.

Re: Starting a Restaurant

The best routes to take are to research the process of starting a business as well as the industry you're interested in.

I recommend checking out the SBA, Entrepreneur, The Start Up Journal & Nolo. All 4 are great informational resources for the new/small business owner. I posted links for you in the source box.

Associations may be a good avenue to explore as well. These organizations will address many of the thoughts, questions and concerns you'll inevitably have as well as many you haven't anticipated yet. See the source box for some relevant links.

Research, research, research – this cannot be stressed enough. Read as much as you can about the industry. Here are some book titles that are relevant:

* The Restaurant Business Start-up Guide by Paul Daniels
* Restaurants That Work: Case Studies of the Best in the Industry by Martin E. Dorf
* Restaurant Financial Basics by Raymond S. Schmidgall
* Opening a Restaurant or Other Food Business Starter Kit: How to Prepare a Restaurant Business Plan and Feasibility Study by Sharon Fullen
* Upstart Guide Owning & Managing a Restaurant by Roy S. Alonzo
* The Restaurant Managers Handbook: How to Set Up, Operate, and Manage a Financially Successful Food Service Operation by Douglas Robert Brown

There are plenty of free informational resources out there. Check the source box for links to articles.

Re: Starting a Franchise

Again, associations are a good starting point. See the source box for some relevant links.

Here are some book titles that are relevant:

* The Franchise Kit/a Nuts-And-Bolts Guide to Owning and Running a Franchise Business by Kirk Shivell, Kent Banning
* Franchising for Dummies by Michael Seid
* Franchise Bible by Erwin J. Keup

Check the source box for links to articles.

Hope that helps! I wish you much success & happiness in all your ventures!

Answer 3

Some franchisers present priceless offerings to the franchisee. There are countless numbers of McDonald's franchise homeowners who're millionaires, they usually might close to all agree that they more commonly might no longer be as effective in trade with out the aid bought from the McDonald's Corporation. Visit "Hamburger U" in Oakbrook, Illinois, someday. Things like exertions legislation, coaching, marketplace checking out, and new product growth are most commonly past the potential of an impartial eating place proprietor.

Answer 4

The best way to start is to save up money to rent a place. Then if you don't have much business experience, you can always read books about starting a restaurant. And you can always watch "The Apprentice".

Answer 5

Look at these sites --

www.entrepreneur.com

www.entrepreneurmag.com