1. What are the advantages and disadvantages of purchasing an outlet from a small franchisor? 2. Suppose that one of your friends is considering purchasing a BurgerFi franchise and asks your opinion. What advice would you offer him or her? 3. Develop a list of questions that a prospective franchisee should ask the franchisor and existing franchisees before deciding to invest in a franchise.

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Would You Buy This Franchise? Although opening a franchise is not a "sure thing," franchising's immense popularity is due, in part, to the support, experience, and training that franchisors provide their franchisees. Many would-be entrepreneurs believe that franchising reduces their risk of failure and see it as the key to their success. Large, established franchises have systems in place that have been replicated thousands of times and allow franchisees to follow a formula for success that the franchisor has worked out over many years. Many small franchisors don't have the benefit of learning from the mistakes of setting up thousands of outlets to fine-tune their business systems. Some franchisors build their business models on fads that will fade, while others tap into meaningful trends. Some of these small franchises have the potential to become tomorrow's franchise giants; others will fall by the wayside. What factors increase the probability that a new franchise will succeed? Unique concept. To be successful, a franchise must offer a unique concept that registers with customers by solving a problem or making their lives better or easier and gives the company a competitive edge in the marketplace. Effective and efficient system. Successful franchisors have developed a system that enables the business to operate smoothly and efficiently. They also work constantly to Effective and efficient system. Successful franchisors have developed a system that enables the business to operate smoothly and efficiently. They also work constantly to improve the system. New franchisors whose goal is to sell franchises rather than to focus on ensuring franchisees' success by providing them with a well-functioning system are more likely to fail. Replicable system. Not only must a franchise system be effective and efficient, it also must be replicable. The ideal franchise system is easily teachable to franchisees. Experience. To be able to provide franchisees with an efficient, effective system, a franchisor must have experience in the industry and must have built a successful operation as an independent business owner before starting to sell franchises. Powerful marketing. Successful franchisors understand the importance of building recognition for their brands and devote proper resources to protecting their brand names and building recognition for them among customers. BurgerFi Nearly half of all consumers eat a hamburger at least once per week, and many "better burger" franchises, such as Five Guys Burgers and Fries, Wayback Burgers, Mooyah, Smashburger, and others, have capitalized on the opportunity to sell premium burgers to hungry customers. In a typical year, Americans eat more than 9 billion burgers. In the United States, hamburger restaurants generate $70 billion in annual sales. In 2010, restaurateur John Rosatti noticed that one of the best-selling items on his full-service restaurant's menu was its burgers, and in 2010, Rosatti partnered with Lee Goldberg to open two BurgerFi restaurants in southern Florida. BurgerFi features 100 percent pure Angus beef patties with no hormones or antibiotics, made-from-scratch fries, double- battered onion rings, Kobe beef hot dogs, fresh toppings, local craft beers, and wine. Two years later, BurgerFi began selling franchises, and business partners Jim Pagano and Henry Talerico were the company's first franchisees. Pagano had owned several businesses during his career, including an auto dealership, and decided that the time was right to get into the restaurant business. By being the first franchisee in the BurgerFi system, Pagano and Talerico were able to have their choice of territories. They entered into an area development agreement with BurgerFi to open multiple units in Orlando and Gainesville, Florida. Purchasing a BurgerFi franchise requires an investment of $460,000 to $995,000, including $37,500 for the franchise fee. Prospective franchisees must have a net worth of $1 million, with $500,000 of liquid capital. Franchisees also agree to pay an ongoing royalty of 5.5 percent of their gross sales. BurgerFi requires at least one member of a franchise group to have prior experience operating a restaurant (preferably multiple restaurants). BurgerFi (the name comes from its founders' desire to lead the "Burgerfication" of the United States) plans to have 300 locations across the United States in four years. The premium burger market is getting crowded, and operating a successful restaurant is extremely challenging. Owners often struggle to keep food and labor costs under control, counteract constant employee turnover, and cope with long hours. Franchisees, however, benefit from affiliating with a recognized brand, relying on an established business system, and leaning on support from an experienced franchisor