An ex-PAL stewardess but now a small business owner herself who is into making Premium Cakes for Corporate Accounts related this talk with a crewmember of a Native Delicacy franchise in a mall in Manila:
1. Average daily sales is only P3,000/day or P90,000/month
2. Rent is about P35,000/month
3. Assume Food cost is 30% or P27,000/month (which is on the low side of estimates
4. Salary of at least 2 crewmembers
5. Franchise package maybe about P350 to 500,000
6. Net Income is about P5,000/month.
According to the crew, the owner knows the income is low but gets it back by having several outlets.
PLEASE LET ME KNOW IF THIS APPROACH TO FRANCHISING IS SOUND BUSINESS-WISE?
It will take you more than 10years to get back you PHP500,000 for the franchise investment. That is too long . Ideal ROI is about 3-5 years including target interest because your 500K 5 years ago is no longer 500K now in terms of buying power.
ReplyDeleteMy one cent.
I agree. Anything approaching P100-200k deserves a pause. Is it still worth it? Will the biz still be viable what with cost on rent, cusa, packaging and wages going up, can the low prices be maintained or can you raise prices without your customers going to the next substitute. I just posted something about the scramble and its attraction of low price but can it be sustained?
ReplyDeletehow much is the franchize cost?
ReplyDelete