Mcdoald's frachise

    McDonald’s franchise   

  The sole proprietorship is usually defined as a business that is owned and operated by one person. In order to establish a sole proprietorship, you only need to obtain the licenses you need and begin operation.

   I choose Sole Proprietorship, owner ship to own my McDonald’s franchises because McDonald’s franchises their restaurants to individuals who personally operate their restaurants and are involved in the day to day operation of their restaurants. They do not franchise to partnerships or allow investors.

Advantages of sole proprietorship

·         The proprietor is not required to share profits with anyone.

·         There are no co-owners or partners to consult.

·         Control and decision making vested in one owner.

Disadvantages of the sole proprietor

·         Unlimited liability meaning, the individual proprietor is responsible for the full amount of business debts which may exceed the proprietor's total investment. This liability extends to all the proprietor's assets, such as house and car. Additional problems of liability, such as physical loss or personal injury, may be lessened by obtaining proper insurance coverage.

·         The enterprise may be crippled or terminated upon illness or death of the owner.

·         Less available capital, ordinarily, than in other types of business organizations.

Why did I choose this franchise?

    I choose McDonalds franchise because with locations over 30,000 in 119 different countries and fifty years in the burger business, the McDonalds brand is the most recognized and successful franchise in the world. The fact that more than 27 million people visit a McDonald’s every day shows that this is a fairly recession-proof business.

Who started the franchise?

·         Mac McDonald’s and Dick brothers opened Bar-B-Que restaurant on fourteenth and E streets in a San Bernardino, California.

·         It is a typical drive-in featuring a large menu and car hop service.

·         They used streamlined assembly line for serving hamburgers milkshake and French fries.

·         Ray Kroc, a milkshake mixer salesman, ventured to California in 1954 to visit McDonald's hamburger stand, where he heard they were running eight mixers at once.

·         Kroc was impressed by how rapidly customers were served and, seeing an opportunity to sell many more milkshake machines, encouraged brothers Dick and Mac McDonald to open a chain of their restaurants.

·         Kroc became their business partner and opened the first McDonald's in Des Plaines, Illinois in 1955.

·         McDonald's and the Golden Arches have since become an internationally-recognized symbol of quick-service hamburgers, fries, chicken, breakfast items, salads and milkshakes.

·         The McDonald's begins to franchise their restaurant, with Neil Fox the first franchisee

Owner: McDonald’s family

Address, 2111, McDonald’s Dr.  Oak Brook, IL 60523                                                                                          phone Number: 630 623 6196

Franchise Fee:

·         You have to pay a $45,000 franchise fee, this is only the initial franchise fee for licensing rights.

·         New franchise cost range from $995,000 to $1,843,000

·         Price range of an existing restaurant varies and is dependent upon a number of factors including sales volume, profitability, occupancy costs, reinvestment or improvement needs, competition and location.

Capital Requirements/investments

·         An initial down payment is required when you purchase a new restaurant (40% of the total cost) or an existing restaurant (25% of the total cost).

·         The down payment must come from non-borrowed personal resources.

·         Generally, you need a minimum of $300,000 of non-borrowed personal resources to be considered to open a McDonald's franchise.

·         Require that the buyer pay a minimum of 25% cash as a down payment toward the purchase of a restaurant.

·         The remaining balance of the purchase price may be financed for a period of no more than seven years.

·         Service fee, a monthly fee based upon the restaurant’s sales performance, currently a service fee of 4.0% of monthly sales.

·         Rent, a monthly base rent or percentage rent that is a percentage of monthly sales.

Advertising fees

·         There is no advertising cost for the franchisee because the McDonalds Company takes care that.

Royalty fees: 12.5%

Term of agreement: 20 years, can be renewed after

Renewal fees: $45 thousands

Training and support

·         Willingness to complete a comprehensive world class training program and become proficient in all aspects of operating a McDonald's restaurant business.

·         The capability to effectively manage an organization that recruits, trains, and motivates restaurant employees who deliver an exceptional customer experience.

·         Franchising system is built on the premise that McDonald's can be successful only if our Owner/Operators are successful.

Some of the training includes:

• 9 - 18 months training in a restaurant close to your home
• Self directed, part time - 20 hours per week or full time - 40 hours per week
• Seminars, conferences, one-on-one training sessions
• Success based on competency
• Operator training classes conducted by local training professionals
• 1 advanced 5 day course at the Fred L. Turner Training Center at Hamburger University, Oak Brook IL.