Famous Toastery president: '3 ways to reduce opening costs'

Everything is getting more expensive. That's no secret. From rising gas prices to increasing food costs, inflationary pressures are a leading concern for both the consumers and the business owners of today. That is why, at Famous Toastery, we've spent the past year focused on finding strategic ways to reduce the costs needed to open a restaurant. Our ultimate goal is to eliminate some of the barriers that may discourage prospective franchisees from signing on while also increasing profitability for those who are in the system.

The strategy was born during the recent revamp of our flagship Davidson, North Carolina location. That process really taught us about how we can save costs and optimize what we have done in the past. For example: are there ways to set up a kitchen operationally that makes it cheaper to build out? Do we have national contracts with vendors that can provide us with equipment to keep costs down? The Davidson remodel allowed us to answer a lot of those questions.

Now, the goal is to utilize those lessons learned and roll them out across the entire Famous Toastery system, both for existing franchisees and incoming owners. Measure twice, cut once. We are spending time on the front end to ensure we have the correct architectural plans, the correct construction process, the right design elements, and the right operational model. That way, we can get open faster and for less money.

Here are a few of the ways we've managed to reduce our start-up costs for franchise owners.

1. Build out

To start, we are finding efficiencies when it comes to our next build-outs. You can find those efficiencies in a handful of ways. One is in the architectural design, making sure we have plans that are completely spelled out with no room for interpretation. That way, the general contractor doesn't run into problems or questions that may result in costly errors.

Our team is also more selective regarding real estate. It can be very tempting to go buy a piece of land and build everything brand new, but sometimes that isn't the best strategy. If we can find a second-generation space that only needs to be lightly modified, it will keep costs down inherently for our owners without sacrificing our brand standards. We are very diligent about doing the research — we are not just cutting costs to kill ourselves later down the road.

2. Vendor relationships

The larger a franchisor becomes, the more it can leverage its buying power as a whole. We have grown significantly over the past years, which means we have more of an opportunity to negotiate prices down as we leverage the size of our brand and growth trajectory to showcase why we are a valuable partner for these vendors. That will then result in cost efficiency for franchisees through everything from construction, operations and marketing. That is one of the main things you are buying into as a franchisee; that buying power.

For example, the Famous Toastery equipment package is handled with cost efficiencies in mind, similar to how the brand already handles sourcing for food and beverage. This isn't just street pricing — we are working directly with manufacturers to collaborate with them on deals and to get the best pricing possible.

Franchise fee discounts

Perhaps one of the simplest ways to cut down on start-up costs is to offer franchisee discounts for joining the system. These incentives should be strategic and purposeful, targeting ideal candidates who can make the brand stronger.

For example, we offer a veteran-only 50% discount on our franchise fee of $45,000. Franchising, in general, has always been a great fit for veterans because it comes with a playbook, and military life is about following playbooks and executing a mission. The military requires exceptional leadership, grit and the ability to execute a playbook. That is very much like running a franchise. We believe Famous Toastery franchise ownership can be a great option for veterans looking for their next adventure — we provide our franchisees with an in-depth playbook, operations manual, support and proven business model to ensure they have a path to success.

Overall, the cost is one of the most common factors holding entrepreneurs back from achieving their dreams and investing in a franchise. By reducing the costs necessary to start a franchise, franchisors can open their business opportunity up to more people and take their system to the next level.