Franchising

This started out as a few simple posts by some former students on Facebook and I just got carried away with my explanations. Hope it answers some of your questions, and if you have more, just ask. I have a really good source on franchising but he’s unavailable today. Some of you who have worked for a franchised food location could also comment.

 

Quizno's in Rosenberg/Richmond by Wal*Mart is closed for good. :(

 

Comment:

NOOOOOOOOO

 

Comment:

I think the same ppl own the one by pecan grove so maybe it was a bit much?

 

Comment:

They didn't have a reason on the sign, but it did say they were going to be at the Pecan Grove location.

 

 

Reasons? Time for a new lease negotiation and the landlord wanted more for rent is usually the #1 reason a franchised place closes (or more typically, relocates). They could have also not come to terms on the length of the agreement … 3 years, 5 years, 10 years?

 

In MOST cases, if a franchisee can no longer operate the store profitably (or up to company standards), the company will search for a buyer to take over the location, either an existing franchisee or they will make it a sweetheart deal for a new person to own it ... or they will make it a company store until they can find a new owner.

 

For a Quizno's - or any of the franchised companies - to shutter a location means they made a mistake, unless ALL of the stores owned by the franchisee go under (and in this case the PG store is still open).

 

But … it may be a pull back by the corporation. The local guy says, “look, I’m running two stores and struggling. Could I consolidate them into one location? Or could I just close one (maybe just for a while) until the economy picks up?”

 

I haven’t been into the fine print of franchise agreements in a while, so my guess here is that rather than see TWO stores close, the corporation might have said okay to closing one. Or it may go back to lease agreement and they’re looking for a new spot and don’t have right now.

 

Note …

McDonald’s has the most extensive real estate and market location operation of any franchise company. Burger King once admitted they would see a McDonald’s going in and figure they should be nearby and build a store. The let “Ronald” do all the leg work and just tagged along.

 

 

Comment:

They were nice people but too expensive for their sandwiches.

 

While each store can set their own prices, the main prices are strongly suggested by the regional and/or corporate office. You liked the service aspect, so for you, it comes down to “value” or “bang for the buck.”

 

Quizno’s just didn’t get the message out about their pricing was a good value versus the $5 Foot Longs like Sub-Way. Schlotzky’s has pushed their new sandwiches as well as their value pricing, as has Sonic, as well as all the burger places (except What-A-Burger, who stand alone on quality and service in the fast food burger industry.)

 

 

 

 

Comment:

I ate at a ghetto Quizno!!! they were mostly out of everything! I ate what they had!! and I say the place sucks ... I think subway is better!!! :)

 

While franchising is about getting the same quality and consistency in Richmond, TEXAS or Richmond, VIRGINIA, it comes down to the local people. With franchised operations, sadly, people judge the whole chain based on one store for the WRONG reasons.

 

 

If you don’t like that Burger King uses sesame seed buns for all their products, or that McDonalds uses chopped onions, or the way Jack-in-the-Box makes their fries, or the way one pizza chain does their crust, then THAT would be a valid reason. Personally, I think the $1 spicy chicken sandwich at McDonald’s is too hot for me and I will tend to stay away based on that.

 

All stores have a service hotline number or web site. Use it!!! Compaies want to know why you were unhappy and why you wouldn’t come back. Sometimes they will send you an apology (meaning a free food coupon) as a way to get you to go back. If they have too many complaints about one store they’ll look into it. They do want that “consistency.”

 

Note …

When the Big Mac was invented in Pittsburgh, it had tomatoes. But when McDonald’s wanted to use it as a standard menu item, they knew that tomato prices and quality could vary from region to region and were not used on any other sandwich at the time. Thus, no tomatoes on Big Mac’s. But it WAS a way for people to choose between a Big Mac or a Whopper – well, that and the flame broiling versus grilling thing.

 

 

 

Comment:

What you're saying is there might be a possibility that it will re-open under a different franchise owner?

 

It "might" reopen there. Not knowing the situation, I can't say for sure.

 

But the thing is ... people are used to going to that spot in Rosenberg for sandwiches. It "could" re-open as one of the other franchised names mentioned here. Or it could re-open as a "no name" sandwich shop.

 

My first bet would be it re-opens as a Quizno's. Second bet would be a no name. Third would be a different franchise.

 

First, that's a LOT of equipment in there that has to be moved. It starts out as property of Quizno's and is bought by the franchisee. Do the local people own it all, or just part? IDK. But that's a lot of $$$'s. Those of you who have worked at one franchise food place and switched to another know that none of them use exactly the same equipment.

 

Second, the building is "built out" to Quizno specs. Another sandwich company would come in and have to re-do all the equipment as well as remodeling the space. Another fast food chain would do almost the same thing but it would be A 100% tear down and rebuild.

 

If you and I took it over, we'd do as little work as possible. And if the guy/company who owns the franchise rights is giving them up, there may be a waiting period ... ??? ... That waiting period could be 30-60-90 days.

 

We’ve seen a couple of examples in Rosenberg. Taco Bell closed their Avenue H location and relocated to Highway 36 and added Pizza Hut. But What-A-Burger closed their Avenue H location because it just wasn’t doing the business that their other two store were doing and it was time for a new lease agreement. The W-A-B franchisee for R/R has about 20 stores in the area, so closing one probably won’t put him in a bad light with the corporate office.

Perhaps the BEST local example was the On The Border Mexican food place that closed and then became a Gringo's. Gringo's is local and the style of the building didn't matter, nor did the equipment (they could adapt both to their needs and looks). They are local people looking for a deal. People were used to going to that spot for a Tex-Mex fix and they can still go there. 

On the other hand, don't look for a BBQ place to open in the spot where Dickey's came and left. While that was a franchise, they just opened at the wrong time. They were planning on Del Webb opening and when that didn't happen it hurt their business plan. They were also hoping for more highway traffic - but if you're looking for a BBQ pix, you have better places down the road in Wharton, Hilje, and El Campo.

 

Note ...

Domino's Pizza got their name because it was originally Dominic's and all the new owner had to do to the outdoor signs was take out the "ic" and add the "o" at each location. And Domino's sounded better than Tom's ... because an Irish guy named Monoghan took it over from Dominic!