Beth Haselhorst: Location, location, location This is the mantra for many successful enterprises but how important that’s it to the franchise. Our guest is in practical advice on franchise location. Franchise Expert Dick Rennic is an award winning founder of a 360 unit franchise system and former chairman of the International Franchise Association. Dick is recognized as one of the leading experts in franchising. Welcome to sbtv.com Dick.
Dick Rennic: Thank you.
Beth Haselhorst: So how critical is location to a franchise.
Dick Rennic: Well it depends upon the franchise opportunity. If its fast food you got to have a quick in and a quick out, you’ve got to be where people can see you as their driving by. Because lets face it fast food for the most part is impulse buying, people want to get in, get their food and be on the road. So that’s very important. The location, location, location for a service based franchise is an important. Let’s try to break them up in categories.
But, if they were a restaurant they want to be able to get drive by traffic or anything that does foods. If it’s a product, maybe you would like a, like a Hallmark store which is a franchise those kinds of things. That’s probably anchoring somewhere on a strip mall something like that. Still it’s got to have a lot of traffic that goes into that strip mall. But if there a mobile franchise or a home based franchise, location is not relevant because they’re on the road. They're out there in service vehicles and they're services vehicle denotes the brand and that is their moving bill board so wherever they parked that truck they need to take advantage of that truck or their service vehicle.
And when they're working at somebody’s property they need to leave something behind to the neighbors, so that the neighbors knew that you're on the neighborhood and you could have helped them.
Beth Haselhorst: Okay, so when you're looking at a franchise its location part of the franchise agreement?
Dick Rennic: Yes, it is for service-based franchises usually and for mobile franchises its not part of that, you can work from home sometimes you get a couple of trucks. You get more than a couple of trucks parked in the neighborhood, they're not going to like that, you need to move it into a strip center or an industrial park somewhere. In the franchise you're doing whether if its fast food or product intensity, the agreement will lay out the standards that they're looking for and in most cases the franchisor or the one that awards the franchise will have a real estate staff either in house or that they contract with that helps you to find a location.
Let’s say that you were thinking about buying a coffee beanery franchise and in buying that coffee beanery franchise you needed a good mall location because you wanted to be a bigger operator, or maybe you wanted to be an airport. The franchisor of the of the coffee beanery will help you with that and they’ll make sure that you get the right location based on what you're looking for and based on what they're looking for so that you get all that walk-in traffic.
Beth Haselhorst: When franchisors are setting up the territory where you can potentially open up the franchise what are they looking at to determine territories.
Dick Rennic: Well they look at several things depending upon the franchise, their looking for population, their looking for the potential for calls for services needed. Let’s take a look at a franchises that have been out there for about 25 years, a company called Spring Mobile at Thousand Palms, California.
They’ve got about 90 units across the country and they're beginning to grow very fast. This particular company sends out their service trucks, they go to your house, and they changed out the screens and keep your house safe from bug infestation, animal infestation and that list goes on. Those kinds of franchises are out there and are very relevant to society. So the more we can make people conscience of the different types of mobile franchises the better it is for those husband and wife teams or partnerships that are living together, they want to spend time together they may pass off house cleaning, to a mage franchise. They may pass off carpet cleaning to those people, alarms and the list goes on.
Beth Haselhorst: Where can people get more information about location and franchising in general?
Dick Rennic: Well franchising in general is my favorite website is www.franchise.org that’s the International Franchise Association’s website. Once they start looking at franchise opportunities there is three franchise shows that they can go to and there is a merit of periodicals they can pull here from the international franchise association. They can either find it online or they can make a phone call but the key is that they have to find the franchise that they think they might want to be involved with and then they just need to start communicating with them to find out if location, location, location is part of it.
And if location, location, location is part of it they’ve got to look at cost because if you get a real hot location you might spend $40.00 to $50.00 to about a $100.00 of square foot for prime location. So when you look at that and you look at on buying a $20,000.00 service vehicle and know that that’s your location it’s a whole different venue.
Beth Haselhorst: So very important, important thing to think about when you're looking at franchises.
Dick Rennic: You better do.
Beth Haselhorst: Thank you very much for your time today Dick, look for other segments on franchising in small business from Dick here on sbtv.com. You can also learn more about Dick Rennic and he’s franchising consultancy business by going to www.teamrennic.com this is sbtv.com small business is our only business.
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