hi all!

I have saved up an amount of savings and would like to venture into business. however, I have no experience in business and from what I have read, franchise gives me the experience but in a controlled environment (with guidance depending on which franchise). I read that mc donalds have a good franchise programme. I'm afraid without business guidance I will fail which is why toying with the franchise idea.

another issue I would like to clear out is, what is the ROI like considering the high amount of capital I have to put up and also funding I have to take loan. I haven't asked PNS what the exact figures are for capital n funding of the various franchise. just a ball park figure would be ok.

would really appreciate if anyone with experience in owning a franchise, give their opinion.

Made-in-Malaysia franchise is profitable for the FRANCHISOR!
Other than McD which Made-in-Malaysia franchise have proven program to ensure success for the franchisee?

yeah. of course. franchisor will always make money from franchisee. but it is a win-win situation, the way I see it. the person investing follows a a proven track-record of services and get profit. and the franchisor is relieved from the burden of investment and risk from all the outlets. but I guess like any investment, lower risk(just follow a system), lower yield(pay franchise fees etc).

but I'm considering because I don't have much business experience. I take it as a practical MBA course. however, would still like some sharing of experiences from people who own a franchise.

I'm not so sure I understand the made-in-Malaysia franchise term but I believe any famous franchise would be ok because they have a proven track record. mcD, KFC, burger king maybe? those are the ones in F&B but any other experience from different area also welcome. for now still open.

You can only make money by having multiple stores. Having 1-2 stores will not gives you profit.

really? I understand no profit probably for a while to pay off the loan. but to say no profit unless have 2-3 outlets is too much. it might not be a lot but I'm sure there is. nvm, I'll just go and meet the several franchisors and let them give me some calculations.

but I hope anyone with a franchise store can share their experience.

things will get snowballed "easily" when you have multiple stores. you wont get a lot of earnings just depends on one store. most people use the profit they earn from one store to get 2 stores, then from 2 stores to 4 stores then only start earning big bucks. its a long term investments.

so now you can cash to open 1 store, 2 years later you earn back your some of your investments plus now you can get business loans to get your second stores. another 2 years, you get more money from your 2 stores and get more loans to open 2 more stores. now you have 4 stores with in 5 years. then you can goyang kaki...lol

That is the sales pitch by the franchisor.

Would you say RM3.5m CASH as eligibility for McD franchise is low or high risk?


McD, KFC & BurgerKing are international chains and not made-in-malaysia. Only McD is having franchisee program. Made-in-Malaysia are 1901, PappaRich, 1Station dll.

What are you actually looking at? F&B or retail like 7E or HABA or education?

This post has been edited by DarkNite: Apr 10 2011, 11:12 PM

well, I have never seen a mcD that isn't busy with customers. n they are known to have a good training program. after going through their website, u only need 30% of the total cost n the rest will be from loan. so the cheapest according to the mcD website it 1.5mil n that means 450k cash. n ur required to be a full time 'on-site operator'.

I'm not sure about other franchises tho'. I'm only toying with the idea for now. doesn't really matter which area as long as it has a proven record and also a good training program. like I said, it would give me a chance to go into business but with a proven system. I could always just invest the money but something about having ur own business appeals to me. however, I notice that not many share the same view about it. maybe I'm missing something.

no bank in their right mind will give out loan for a new unproven company (eg your company here) to let you apply for for franchise programme...

that is true....but the way the other guy said was to open two to three at same time....which isn't productive in the short run....
franchise are profitable but wouldn't be much more profitable than opening your own brand...but then it has less risks...
However, it does have lots of rules and regulation that you've to follow....
for example...when HQ decide to change restaurant layout or uniforms....all must follow...so there'll be some extra costs there...
but if you open the restaurant at a good place...the gain would surely cover the costs....and maybe after that...
you can try opening your own brand or place....

in conclusion, it's a good business to start with...

The franchise fee for international franchises is a huge sum. Have you saved up to at least RM2Mil? Loan in this case, what do you have in order for a bank to agree lending you a huge amount?

worst investment.

u dump in a lump sum and its not 100% guaranteed return.

Yup. Mcdonalds is a proven concept. But please bear in mind that there are only 22 mcd franchisees in malaysia.
You must be thinking, why is something so profitable has only 22 franchisees?
Why are all the datuk datuk with tens of million not venturing into such lucrative business?
That is because all the mcd with an endless stream of customers are all own by the franchisor itself, ie. Golden arches.
U want to be a franchisee? Sure...only if u agree to try your luck in those ulu ulu places golden arches has no confidence in the 1st place.
But dont be dishearten by my words. I may be wrong.

Reputable franchisors like McDonalds are OK. They do survey and feasibility studies before granting franchise. The way I see it, franchisors like Berjaya is not fair. Sometimes you can see two 7-11s in 2 row of shophouses like in Sg.Long. Not only you have to compete with other chain stores like KK Mart and 99 Supermart, you have to compete with your kind also. Even their own building Berjaya Times Square has two outlets and another one just across the road link by an overhead bridge. That is what franchise holder is afraid of. You can't control where they want to set up another one.

Berjaya itself already got 4 7-Eleven if I am not wrong lar.
1. Near Hotel, ground floor.
2. After MRT exit.
3. Facing the link bridge.
4. Somewhere near McD.

All good business.. Lolz

thanks everyone for the valuable input although some information are not entirely correct like the amount of cash needed and whether a bank would finance. the truth is that u only need to come up with 30% like I said which translate to min rm450k n the rest can be financed by PNS. in my view why not everyone that do have the cash do it is because the strict requirement to follow their system which is also the reason of their PROVEN TRACK RECORD. nothing is guaranteed obviously but again, have u seen an empty mcd even in rural place? back to the strict requirement of the system, it requires the franchisee to undergo a 1 year training before opening the outlet n also the fact that the person must be a full time store operator. this is true at least for mcd, says so in their website. so the things I must consider is whether I am willing to own the store as a 'career' unlike other investment which become a 'part-time' commitment.

Hi sorry to hijack ur thread. But I'm wondering if there's ant franchise for small newsstand tat sells magazine, newspaper, tobacco and candies alike?

Thank u.

1.5mil will not be enough and that figure is a sales pitch. Do bear in mind, some of the fees and expenditure require up-front cash and not payable by loan or installments.

If you only have 450k cash and without any other steady income of RM1x,xxx, you will be at a great dis-advantage to negotiate and to service your loan. Dun forget your steady income of RM1x,xxx comes from sources that do not requires your presence or attention whilst you are working full time 'on-site operator'.

Do MacD, very profitable

Nope. Depends.

currently, Made In Malaysia franchises that seem to be working are those Old Town Kopitiam, Paparich Kopitiam etc lor.

all of them alw packed with ppl and using foreign labour to cut costs.

a lot cheaper than McD too!