If you have not considered operating a franchise in Denver, you will after exposing the favorable conditions that prevail there. First, uncover why Denver Colorado franchise opportunities abound. Then, read about some famous franchise success stories from the mile-high city. Finally, learn how to start a franchise for yourself.
You have two options for franchising: Expand your own business by creating a franchise opportunity or invest in an existing franchise with a proven track record. As is the case with all business models, there are pros and cons to franchising. But, there are important steps to take if you wish to do it right. Therefore, whether you choose to create your own franchise or invest in one for yourself, continue reading to discover why Denver Colorado franchise opportunities are worth serious consideration.
There is quite a large array of franchise concepts that succeed in Denver. Also, many industries are planted there, from beverage production to aerospace. Therefore, you will find bountiful populations within many local demographics to target with your franchise opportunity.
According to information from the United States Department of Commerce and Census Bureau, as of September of 2019, the unemployment rate in Denver was only 2.7 percent. When you compare that to the national average of 3.7 percent in September, you can see just how strong the economy really is in Denver. Also, the Denver job market has increased by 2.8 percent since 2018, compared to 1.6 percent nationally. Furthermore, jobs are expected to grow by 45.0 percent over the next decade, which is much higher than the national average of 33.5 percent.
Colorado ranked number seven among states for economic growth in 2018 overall, according to the Denver Post. Also, according to Denver Metro Chamber of Commerce, Colorado has several unique advantages. It has an expanding entrepreneurial community, increasing business startup activity, and a highly educated workforce. Finally, the diverse demographics are supporting growth in retail sales. To explain, Denver is experiencing excellent population growth with an ever increasing buying power.
Regarding your Denver, Colorado franchise opportunities, this means you will have great potential for success. And if you carefully weigh the pros and cons and then follow the right steps, you are bound to succeed!
Some very famous franchises began in Denver, proving Colorado franchise opportunities are lucrative. Therefore, when you combine the entrepreneurial spirit with a great location in Denver, success will surely follow. So below, see three great examples of franchise success stories that began in the heart of the Mile High City:
Founded by Steve Ells in July of 1993, Chipotle quickly became a successful franchise and grew to 16 locations in Colorado over a five-year span. Steve Ells opened his first Chipotle Mexican Grill in Denver, Colorado, in a former Dolly Madison Ice Cream store. Then, in 1998, McDonald’s invested heavily in Chipotle, helping it grow to over 500 locations by 2005. Steve named the company after the smoked and dried jalapeño chili pepper – Chipltle pepper.
After opening 1995 as Zuma Fresh Mexican Grill in a suburb of Denver, Colorado, Anthony Miller and his partner Robert Hauser had a phenomenal first year. They brought in over $1.5 million in revenue that year. Then, by 1997 they started offering Colorado franchise opportunities so they could expand quickly and grow beyond Colorado. By 1999, they had 49 locations in 19 states. Finally, in December 2017, Qdoba was purchased for approximately $305 million. By that time, Qdoba had around 700 locations in 47 states.
Qdoba had a rough time with names. As Zuma Fresh Mexican Grill, they were sued and forced to change their name to Z-Teca Mexican Grill after being in business for two years. If that wasn’t enough of a blow, they were sued again and forced to change their name to Qdoba Mexican Grill after another two years in business, four years after opening. This is a great example of how the entrepreneurial spirit can endure adversity.
The original Quiznos location was opened in Denver, Colorado, in the spring of 1981, by Jimmy Lambatos and his partner Todd Disner. Lambatos was an experienced chef from Colorado Mine Co. Steakhouse. Also, prior to opening the first Quiznos, Lambatos founded Footers in 1978, an Italian restaurant in Denver. He was a chef with a strong entrepreneurial spirit.
Just like Qdoba Mexican Grill, two years after opening for business, Quiznos started offering Colorado franchise opportunities. They were ready to grow very quickly by 1983. Then by 1987, there were 12 Quiznos locations operating within the United States. That same year, Rick Schaden and his father Richard Schaden opened their first Quiznos franchise in Boulder, Colorado. After that, they opened three more locations before purchasing the entire 18-location company from Jimmy Lambatos and Todd Disner in January 1991.
Ten years after opening its doors in Denver, Quiznos became the number-three submarine sandwich franchise in the world, with 278 locations in the United States in 1997. Then in May of 2018, Quiznos franchises numbered around 1,500 locations across the United States.
Now it is time to consider your two options for franchising. Do you currently have a business that you wish to expand by creating a Colorado franchise opportunity in Denver? Or, are you interested in investing in an existing franchise that has a proven track record? These are two options that offer a path to success, but are completely different. The first option allows you to scale your own company quickly. And the other gives you the opportunity to take a successful brand and establish it in a lucrative Denver location.
Investopedia defines a franchise like this:
“A franchise is a type of license that a party (franchisee) acquires to allow them to have access to a business’s (franchisor) proprietary knowledge, processes, and trademarks in order to allow the party to sell a product or provide a service under the business’s name. In exchange for gaining the franchise, the franchisee usually pays the franchisor an initial start-up and annual licensing fees.”
When executed properly, and at the right level of maturity, franchising allows you to increase market share and scale your business quickly. This is done by selling a license to operate a copy of your business in another location. Since a franchisee has ownership in their franchise, they are more likely to succeed, versus a manager that the business owner hires to oversee an additional location.
The franchisee takes on all initial costs. Also, they pay the startup fee and the annual licensing fees. Next, they do the heavy lifting and the due diligence based on rules, regulations, and guidance from the franchisor. It is important to remember that the success of the franchisee leads to the success of the franchisor. So for the correct perspective, look at it as a joint venture between the franchisor and the franchisee. Therefore, the franchisor must be a good leader.
Although the franchisor must work hard to guide a new franchisee to success, their job is much easier as a franchisor with regards to individual locations. They do not manage day-to-day operations at the locations. But, while guiding franchisee’s to success, they must focus on the business and the brand, and enforce compliance among the franchisees, as the leader. Some franchisees may try to implement their own version of products and services. It is the job of the franchisor to prevent that from happening.
If your business can be easily replicated, then franchising it may be your best option to expand it quickly. So if your company is ready for expansion, jump in now and start pumping up your profitability. First you must get organized. Document everything. Develop an operations manual detailing all procedures, rules, guidelines, and best practices. Take yourself through the process of restarting your business from scratch.
Once you have organized and documented everything, you must prepare an FDD or Franchise Disclosure Document. Be sure to hire an attorney to oversee and help with the entire franchise process. Also, they will help you register your trademarks and legally protect your intellectual property. Finally, an attorney will assist you with the franchise agreement. Make sure you are fully prepared and protected before bringing in a franchisee.
You must fully support your franchisees if you wish to succeed. The franchisee may be good at business, but they are not yet good at running a copy of your business. Therefore, leadership and guidance is the key to success with franchising. Also, allow franchisees to communicate. For example, schedule corporate meetings. Then, create a forum where franchisees can help each other. After connecting your franchisees, your burden will be greatly reduced.
If you are an entrepreneur who does not want to take the risk of starting a new business from scratch, investing in an existing successful franchise may be your best bet. For a fee that can range from $20,000 to $50,000 and up, and the cost of materials, you can start with a proven business model and an already successful brand. Market research is provided by the franchisor, and marterials are already determined Also, the cost is less due to volume discounts from the vendors. Thus, everything is laid out for you to be successful. And, there is already a demand for the product or service from the successful franchise.
Note that there is groundwork to perform before becoming a franchisee. For example, consider working in every role over a six-month period or longer. It is important to fully understand every job at the franchise. Then, study the Franchise Disclosure Document until you can rewrite it from memory. That is the legal document that will determine your fate as a franchisee. Also, talk to as many franchisees as possible. They are all listed in the FDD. As an example, ask them about the pros and cons of the franchise, and if there are any hidden costs. Then, ask them what they have learned after operating the franchise. Also, ask them what they discovered that they did not learn from their initial research before becoming franchisees.
Please note that being a franchisee does not appeal to everyone. So, read this carefully. Being a franchisee means you cannot be an independent-minded entrepreneur. As a franchisee, you must follow all the rules and regulations and conform to the brand of the franchise. As such, all products and services must be exactly the same at every location, and that means your location too. So if you can be led, and if you can comply and conform to a proven recipe, you can be a franchisee.
Selecting the ideal location for your franchise is job number one. You probably recall hearing the saying: “location, location, location.” In other words, location is of the upmost importance. Everything else pales in comparison. Therefore, make sure you take location selection very seriously. Also, be sure to read Denver Commercial Real Estate: The Complete Guide to Locating, Negotiating, and Leasing Commercial Real Estate in Denver to prepare yourself to step forward and succeed.
In the guide, you will learn how to optimize your location search. Also, you will uncover the many factors that determine the correct formula for selecting your ideal location to open your franchise. Finally, you will see how Space Selectors will provide you with all the support and insight needed to succeed. And, they will help you answer the following questions to equip you for success:
Space Selectors was created to offer a simple and customized commercial real estate search in Denver. They will equip you with everything needed to launch your franchise from a strategic, well-informed position. Through Space Selectors, gain exclusive access to the top experts who are highly-skilled in evaluation, demographic analysis, and commercial real estate negotiation. Then, uncover just how quick, economical and simple their platform works for you to find those ideal commercial real estate options.
For more information on locating, negotiating, and leasing commercial real estate in Denver, contact Space Selectors today. They will provide you with resources for all your Denver commercial real estate needs.