Ron Feldman
speaker
3,922 appearances
11 recordings
1 series
first heard Jun 2010
last heard Dec 2020
Ron Feldman’s voice in public audio — every appearance, attributed to the second.
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Appearances
It's written by lawyers to protect you.
That's what it's done for.
And it shouldn't be the document that you put in front of a banker.
First of all, the average FDD is about 400 pages now, so they're certainly not going to read it cover to cover.
So good franchisors are doing...
a lot of the things that we've been preaching in terms of best practices to having a strong item 19, not just gross sales.
Taking item 20 and spreading it out to explain each reason for store closures so that bankers can understand that it wasn't just people closing up shop because they failed operationally.
And putting those things into a format
like a bank credit report, to let bankers understand in their own terms and language what they're getting themselves into relative to making a loan to that brand.
Those are the franchisors that are getting loans done.
The ones that aren't ascribing to those best practices are having a much tougher time, unless you're a brand like McDonald's where you have national brand awareness and proven operators that you don't need to do all those things.
That goes back to one of my fundamental issues with the whole franchise marketplace, and that is if I write an FDD and I don't have a business model that works, I can be a franchise.
And I've got a fundamental problem with that.
If you're going to franchise your business, the first thing you need to know is if your economic model works.
And you need to do that by having company stores that actually operate and earn a profit.
And not
earn a profit, but you manage it as though it was a franchise unit.
You know, you have in your P&Ls what the imputed royalties and ad fund would be so that you can show a prospective franchisee that,
There is a predictable model.
What are you doing when you're buying a franchise?
Showing 1821–1840 of 3,922 · page 92 of 197
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