Low-Cost Food Franchises for Sale are ideal for the entrepreneur that is looking for someone else to take the initial risk, build out a unit and then pass his diamond in the rough on to a new restaurant buyer. We Sell Restaurants specializes in finding these turnaround opportunities or low-cost food franchises for sale that feature amazing brand names and sell for just pennies of the invested dollars.
Consider that building even a sandwich shop from the ground up can result in investment from a restaurant buyer ranging from $350,000 to $700,000 depending on the brand, amount of equipment, square footage, and the build-out. Low-cost food franchises for sale like the ones featured on this page have the advantage of someone else making the large upfront cost to build out the store and then selling it for pennies on the dollar.
Business brokers specializing in restaurants at We Sell Restaurants prefer the “buy it” versus “build it” approach to restaurant growth. You can acquire quality locations, outstanding opportunities, and a variety of brands from our inventory of low-cost food franchises for sale. Best of all, they are turnkey and you can be in business tomorrow.
The first owner spent the time waiting to go to market while he worked on finding a location, hiring a contractor, dealing with the permitting and building. He did all the heavy lifting. With the assistance of a qualified restaurant broker, all a new buyer must do is capitalize on the inventory of low-cost food franchises for sale offered across nearly every brand in the country and acquire the locations netting a substantial discount.
Our book, Appetite for Acquisition, refers to the ability to buy it versus build it in an entire chapter dedicated to the idea the low-cost food franchises for sale are a better option than starting from the ground up. Here are the reasons we cited.
Control over costs. The single largest cause of failure for restaurant startups is lack of capital. The capital burn rate increases exponentially when a skilled restaurant professional attempts to turn into a building contractor or project manager overnight simply because the project is an eatery. Acquiring low-cost food franchises for sale means you know the purchase price, you know the current results, and you can calculate the break-even point and when you will be profitable.
Unless you are a general contractor who happens to swing a hammer as successfully as you filet a swordfish, starting a restaurant from scratch will take far longer to build and cost much more than you ever imagined. Any would-be restaurant owner considering a build-out has only to watch one episode of the popular real estate “flip” shows on cable TV to imagine the issues.
You negotiate a great lease with three months of free rent, but construction permitting takes four months and rent begins before you open the doors. The special-order light fixtures that feature antlers for your steakhouse are delayed, and an electrical inspection turns into a four-week work stoppage.
Purchasing an operating restaurant eliminates these issues. The cost to acquire one of these low-cost food franchises for sale is fixed. That means your capital goes into covering expenses in the critical first few months. You are focused on growing market share through marketing and advertising instead of starting undercapitalized and without money for basics, like payroll and food.
What we have seen in years of selling restaurants are countless owners that believe they can build from the ground up and save money. Once they get into the project, they begin ordering the best, moving walls, changing their minds, and generally driving construction costs through the roof. Open and operating second-generation low-cost food franchises will always be cheaper.
Time to market is another reason the purchase of low-cost food franchises for sale beats building a new unit on your own. Time is money in every business. Your great restaurant idea can be operating tomorrow with the purchase of an existing concept. Compare that to six to nine months to permit, build, and open a restaurant from scratch. You can be serving your first sandwich tomorrow to existing customers instead of waiting an average of seven months to open the doors.
Yet another reason to focus on low-cost food franchises for sale instead of starting from the ground up is the existing sales volume. Existing units may not be profitable, but they will have some base of business. Any new restaurant must build the initial dollar of sales volume and every dollar thereafter incrementally.
The first $100,000 of sales volume is the toughest to achieve. Without the expense and time spent building from scratch, you can implement marketing plans and operational changes to drive the existing sales line higher at low-cost food franchises for sale that you acquire. Starting from zero sales is a daunting task no matter how well known you are as a chef or how many customers you believe will visit your store.
Risk management is yet another reason to focus on low-cost food franchises for sale like the ones offered here. We are told by many buyers that they want a franchise because there is “less risk.” That is a true statement when viewed against independent startups. One well-known study of the restaurant industry conducted by H.G. Parsa, an Ohio State University hospitality management professor, looked at restaurant industry failure rates. He analyzed health department records for around 2,400 independent and chain restaurants in Columbus, Ohio, between 1996 and 1999. His findings showed franchises had a slight advantage with 43% of the chain restaurants still operating after three years. Why buy the risk in a startup scenario when open and operating low-cost food franchises are available with a track record of sales, an established business model and may only need marketing or operational changes to flourish.
The path to restaurant ownership is often a straight line with the purchase of existing low-cost food franchises like the ones we represent. Whether you are buying someone else’s success or failure, you are buying more certainty than starting from the ground up.
You are busy hiring the best staff instead of tracking plumbing orders. You are focused on developing a focused digital marketing campaign and catering strategy instead of calling the painter that failed to show. Though there is no guarantee, an existing location delivers historical sales, a defined and customer-tested menu, existing operation methods, and in some instances, existing cash flow.
Any cash flow can be improved upon even that of low-cost food franchises that are underwater today. Even a restaurant failing in its current state represents a bargain for the new owner if you can understand and adjust for the mistakes in operation. If a restaurant is succeeding, you’ve purchased a quick path to the lucrative restaurant business without burning your capital. Acquiring low-cost food franchises for sale by an existing owner is like shopping at the sale rack of your favorite store. You are going to find some great bargains.
Ready to look at low-cost food franchises for sale? Check out the restaurant for sale listings online at WeSellRestaurants.com. Each listing is open and operating today and you can be in business tomorrow.