Originally published on June 6th, 2013 on The Gazette. Read Original →
What it takes in this day and age to develop a brand, from conception to launch.
Line up your financing
For most operators launching a brand for the first time, securing financing will be the trickiest part to the process.
Mike Rozman is the co-president and chief strategy officer at Boefly, an online marketplace that matches borrowers with compatible lenders, eliminating the need to travel from bank to bank. Boefly has provided services to quick-serve clients such as Arby’s, Jamba Juice, Del Taco, Dunkin’ Donuts, and Hardee’s. Rozman says it is critical that the borrower is prepared to seek a range of financing opportunities, adding that outside expertise is sometimes necessary to figure out what those might be.
“I know national lenders that have no interest in doing a startup or small business, but the average franchisee or independent owner doesn’t know that,” Rozman says. “So it’s going to be really critical for that business owner to get in front of a wider array of lenders.”
Howard says quick serves, on average, cost around $200 per square foot to build.
“You can do a down-and-dirty great concept with great food … and get that open for $100,000,” he says. “Or you can go all the way and do something extremely polished for $750,000. It depends on what you want to do.”
Schaden says poor financial planning will not only cause a new operator to worry about the business, but will also distract them from ensuring the product is as good as it should be.
To make sure the business’s ongoing financials are protected, operators should create a business plan that estimates how much of product the brand must sell each week and month to pay the staff, pay rent, and keep the doors open, Bailey says. “If you need help with that, get a partner who has that expertise,” he says. “Or there are executives, there are universities that have groups, and [there are] organizations that help small businesses. Also, the local chamber may have people who can get some of that business experience and can help you learn how [a profit and loss statement] is going to be important to your unit.”