Pinkberry has gained more momentum in the frozen yogurt race with funding from Maveron, a venture capital owned by Starbuck’s founder Howard Schultz. For full article, read Starbucks founder bites into Pinkberry by Boyle. The $27.5 million will help Pinkberry scale (grow) their business including possible franchising programs.

As a former marketing manager, I helped convert a mom ‘n pop Hawaiian restaurant into a franchise program. Franchises have helped restaurant chains to grow such as Subway. On the other hand, Starbucks have been able to grow without a franchise model.

Franchising

Pro’s. OPM (other people’s money) Most franchise charge franchisee’s a fee to buy into the franchise and also receive monthly royalty, a percentage of the monthly gross sales. This cash flow will help the company grow and support the franchisees with resources such as marketing.

Con’s.It cost a bundle to set up the franchise program. Hiring a franchise lawyer is a must. In a franchise program, the founders need to manage more people, the franchisees. Imagine a family adopting more children. When McDonald’s implemented the dollar menu, some franchisees feared that this would decrease their business. Franchises in general are great for people who want a turn key solution. The franchisor will provide training manuals and marketing resources to name a few. I advise interested restaurateurs to visit franchise expos.

Warning: I was interested in a franchise and was hounded by the sales agents, many that work on full commission. So I would advise not giving your phone number unless you are serious and done enough research on the company.

Best advice: Interview current franchisees. Skip the bias information from the franchise agents. Take franchise owners out for a great meal and ask them the pro’s and con’s about owning that certain franchise.

Franchise links
*Franchise Expo
*Franchise Gator