Starting a fake franchise

[e***@yahoo.com]

There are so many food franchises out there, that I wondered why
someone can't just invent their own franchise ? Instead of paying the
huge franchise fee, just invent your own and give it the appearance
that is some huge nationally prevalent operation. How will the customer
know the difference so there is no way for the customer to keep track
of the hundreds of franchises out there?

You could visit all existing franchises and copy the attractive
elements of each, such as "chalkboard menus" from Jimmy Jhons, color
scheme from Quiznos, junk slogans on the walls.. etc...

I dont plan to do this, but was just curious why this would not succeed?

[Scott T. Jensen]

Post by e***@yahoo.com
There are so many food franchises out there, that I wondered
why someone can't just invent their own franchise ? Instead
of paying the huge franchise fee, just invent your own and give
it the appearance that is some huge nationally prevalent
operation. How will the customer know the difference so
there is no way for the customer to keep track of the
hundreds of franchises out there?
You could visit all existing franchises and copy the attractive
elements of each, such as "chalkboard menus" from Jimmy
Jhons, color scheme from Quiznos, junk slogans on the
walls.. etc...
I dont plan to do this, but was just curious why this would
not succeed?

*laugh* Ok, I never heard someone say something like this before.

Now I assume you're not meaning to lie to customers that you're a chain when
you're not, but just having the appearance of being one of many. I guess
you could do that. I don't see why you would. Being one-of-a-kind is also
an advantage. Being a home-spun creation is very attractive to some
customers.

As for copying the attractive elements from chains, you should do that
anyway. Copy the good and avoid the bad. But you should do that of all
competitors and not just the chains. Many chains learn from one-of-a-kind
businesses. But you should not just copy to copy them. You need to
understand the logic behind why they're doing such-n-such. That's more
important. For example...

Mainly of the fast food restaurant chains open up new units based on one
criterion and one criterion only. That being: Wherever McDonald's opens up
one of their units.

Now it does save them a lot of money. Every year, McDonald's spends
millions of dollars on site selection. Their competitors' logic was: Let
McD pay for it and we'll just benefit from their labor.

However, that is EXTREMELY stupid. It is the reason why Burger King will
never trump McDonald's. Think of it this way. McD's site selection crew
looks over an area and determines a unit would be a good thing for it. They
analyze growth patterns, traffic flow, easy of entry, and a long list of
things. Based on all these factors, they find the ideal spot for a McD
unit.

Now comes along Burger King. It's people simply find the closest spot to
that McD unit. Guess what. It isn't a better spot that the one held by
McD. Remember the first rule of high-traffic businesses is: Location,
Location, Location. And Burger King suffers because of their laziness. All
chains that simply try to get as close to a McD do. And McD benefits from
their laziness as they help create a fast food mecca for people to go to and
guess who has the best spot in that mecca. ;-)

The moral of the story is: Don't copy the actions of a competitor. Copy
their logic.

Scott Jensen

[John A. Weeks III]

Post by e***@yahoo.com
There are so many food franchises out there, that I wondered why
someone can't just invent their own franchise ? Instead of paying the
huge franchise fee, just invent your own and give it the appearance
that is some huge nationally prevalent operation. How will the customer
know the difference so there is no way for the customer to keep track
of the hundreds of franchises out there?
You could visit all existing franchises and copy the attractive
elements of each, such as "chalkboard menus" from Jimmy Jhons, color
scheme from Quiznos, junk slogans on the walls.. etc...
I dont plan to do this, but was just curious why this would not succeed?

I think that is how many of the B level franchises work. All
you need to do is make a 10% improvement on something and you
can own that market. That is a lot easier than developing
and testing a new concept on your own. Another one I see is
stand-alone "food courts" opening where they have between 3 and
5 different franchises in one building, usually B grade places.

For the most part, a sandwich is a sandwich. Same with stake
houses...can you tell from the inside which one is a Lone Star,
a Texas Roadhouse, an Outback, or a Timberlodge? I sure can't.

For franchises, for the most part, the end customer is not
your customer. Rather, the franchise buyer and operator is
your customer. You are likely not going to pull one over on
that calibre of person. Anyone sane would invest in at least
some due dilligence before putting down the money. Even if you
are a B grade knock-off, you still need to have at least one
successful unit and a system that is ready to go for the
franchise buyers. That is quite a bit of work to do before
you get to sell your first unit.

-john-

[Gordon Woolf]

Post by e***@yahoo.com
There are so many food franchises out there, that I wondered why
someone can't just invent their own franchise ? Instead of paying the
huge franchise fee, just invent your own and give it the appearance
that is some huge nationally prevalent operation.

That happens all the time. There are plenty of food stores which look
*almost* like one of the franchise stores. One problem comes when
someone turns up with a coupon for the latest offering that this store
owner may have just heard of, but certainly hasn't yet sorted out a
means of supply.

As to stores looking like other stores, I realized just how close, but
also how different they can be, when I walked into a store in the
middle of Leipzig, East Germany, in the 1960s. There was the familiar
flat counter displays the red and gold theme, the similar stock range,
and there above the door was a brass plate: F W Woolworth & Co.

Of course it had not been part of the Woolworth chain for a quarter
century.

Similarly, the Woolworths stores in Australia used to look exactly
like the Woolworths stores I've seen in the UK and the US in the 1970s
but they never were owned by anyone even related to the Woolworths of
the USA. Someone just saw a way in and registered the name which would
be very familiar to migrants from the UK. In fact it has gone on to be
one of Australia's two largest supermarket chains. They also own
K-Mart stores here, originally partnering with the US group which was
apparently very happy to be bought out at a time when the group here
was hoping that not too many people thought they were associated with
the US one.

There's nothing wrong with copying someone else's ideas, provided you
do not claim to be that business, and can not be accused of "passing
off" your business as theirs. Of course, if you get too close, you'll
face some pretty big legal bills and maybe you cannot even afford to
win.

And remember that many people have no idea what store they are going
into. That came home to me when a former manager of one of our largest
retail chains told me it was policy to replace any item when a
customer complained -- even if it was clear from the label that it was
bought from their main competitor. The shopper obviously had little
memory of where they really bought the item, but they were far more
likely to remember the place that treated them well over the
complaint.

Gordon Woolf
co-author, Success in Store: How to Start or Buy a Retail Business,
Enjoy Running It and Make Money
www.worsleypress.com