Before you sign a chai franchise agreement, here are some key areas to investigate
Track Record
Research the franchisor's history. How long have they been in business? Do they have a history of successful franchisees?
Litigation History
Are there any legal disputes or bankruptcies in the franchisor's past?
Financial Performance
Request financial statements (if possible) to understand the franchisor's financial health.
Franchise Agreement
Carefully examine the terms of the agreement. This includes fees, territory rights, marketing requirements, training provisions, and termination clauses. Consult with a lawyer specializing in franchise law.
Initial Investment
Understand all upfront costs like franchise fee, training, equipment, and inventory.
Ongoing Fee
Be aware of royalty fees, marketing contributions, and other ongoing expenses.
Profit Potential
Review the FDD's earnings claim section (if applicable in your country) and talk to existing franchisees about their profitability. Develop a realistic financial projection for your business.
Training and Support
What training and ongoing support does the franchisor provide? Is it sufficient to help you operate the business successfully?
Site Selection and Lease Negotiation
Does the franchisor offer assistance in finding a suitable location and negotiating a lease agreement?
Want to Start a Chai & Cafe Franchise Business Under 2 Lakh?