The very first Burger King restaurant, started in 1954 by James McLamore and David Edgerton, was opened in Miami. Often commonly abbreviated BK, it is a worldwide fast food chain mainly consisting of hamburger dishes and delicacies. Burger King exists within parent company called burger king corporate office Holdings. It operates nearly 40 global subsidiaries that manage franchise operations, acquisitions and financial responsibilities and it has its headquarters based in Miami-Dade County, Florida, close to Miami.
Certainly one of its subsidiaries is the Burger King Brands, Inc. accountable for the smooth operation of Burger King’s intellectual assets. Established in 1990, it owns and manages each of the website names, copyrights as well as trademarks which are used by the Burger King restaurants in the US and Canada. Additionally, it provides market oriented services to its parent company.
The key products of Burger King are hamburgers, chicken, french-fried potatoes, fizzy drinks, salads, desserts and milk shakes. Burger King began franchising in 1959 whereby it utilized a regional model where franchisees bought rights to open shops inside a specific geographic region. This technique resulted into a compromising situation whereby there was clearly little oversight control and store regulation implementation of the caliber of products, design and image. Between 1970 as well as the first 50 % of the 1980’s, there have even been lawsuits pertaining to the general charge of the franchises.
After this lawsuit, there was restructuring done for future franchising agreements so they are more restricted and preventing corporations from owning franchises. The policies also disallowed the franchisees from owning other chains that would bring about diversion of funds from Burger King. It made sure that the size of franchisees had not been that big which burger king contact was the key owner of new locations where the stores were to be set up putting them in a position where they could lease or rent the restaurant too its franchisee, and evict or dominate management operations of restaurants that did not conform to their guidelines.
The ownership of Burger King however changed hands again and the strict policies were not adhered to which resulted in financial ruin and straining associations involving the franchises. After almost 18 years without financial growth, the value of the company began feeling the results of its stagnating franchises. AmeriKing declared bankruptcy in 2001 and this caused the depreciation from the fast food chain by nearly $750 million during its sale.
The brand new CEO, Bradely Blum began a restructuring program that was aimed to bring back almost 20% of franchises undergoing financial hardships. It had been an initiative that encouraged individual owners who took benefit from the problem purchasing the failed stores and turning them into profit makers. Most of the once failing stores are growing and after the 2010 fiscal year, Burger King claimed to get ptrorn than 12,200 outlets in 73 countries. 90% from the outlets in the US are privately owned and operated.
The complete investment of burger king falls between $294,000 to $2.8 million with a franchising fee of $50,000. It features a 20 year renewable term of agreement contract which needs a franchisee to possess a net worth of $1.5 million as well as a cash liquidity of $500,000. Industry knowledge of general business experience and marketing skills are necessary.
While looking to begin any organization it is important, particularly considering today’s market, that you simply look for specific ways to cut minimize or reduce overhead and risk. Any business may have risk, but it is important to use a full knowledge of the quantity of investment, start-up cost and “ROI” (Return).
Most people are not aware that 80% of ALL franchise endeavours fail inside the first couple of to five-years leaving large debts looming for years thereafter.