One of the leading causes of franchisee failures is undercapitalized franchisees. Being able to more accurately predict the financial requirements of a franchise investment and compare the results to available investment capital can lower the risk of being undercapitalized.
This data is useful to construct cash flow analysis, pro forma financial statements, targeted ROI and to calculate debt payments for franchise investments. Understanding the annualized cost of a potential franchise investment can provide insight into the franchise investment risk and support the need for thorough operational and financial due diligence.
The annualized investment cost is calculated by dividing the average estimated initial investment by the average initial term of the franchise offering. This provides prospective franchisees and their advisers the ability to recognize the long-term investment in a franchise system.
Download the full report: Franchise Facts and Figures – Annualized Costs
Contact us for a free consultation to help you find the best franchise investment!
New York Times Investigates Subway’s Abuse of Franchisees
New York Times investigation into the use of questionable practices by one its Franchise Development Agents that culminated in the agent acquiring two of a franchisees Subway stores.
Maximize Market Penetration and Branding with Multi-Unit Franchisees
Multi-unit franchising grows in popularity, in the Quick Serve Restaurant sector, this model continues to expand into other franchise sectors in popularity.
The Top 10 Franchise Grade Facts & Figures From 2017
Detailed studies on emerging franchise success rates, errors in Item 20 disclosure and sector performance, Franchise Grade’s reports help you.
A Road Block to Franchise Growth is Right Under Your Nose
New franchise growth is the top priority for emerging franchise brands. Many of these franchises have an obstacle on the road to more franchise locations.