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Updated almost 10 years ago,
food franchise vs real estate
This is a question I have thought about lately and was wondering if anyone had any thoughts on the matter. Clearly you need cash to buy a food franchise, specifically fast food, so this question wouldn't apply to what to do with anything around 100k, most require 500k plus. Some I have had in mind are McDonalds, Sonic and Zaxbys. If you had a 1 million in cash, would you invest in a fast food franchise? The average McDonalds makes around 250k in profit per yr and 2.5 million investment. The average subway makes between 80-120k in profit per yr and around 250k investment.
For those that say this type of business can be too time consuming, you're right but real estate can be as well. I actually know someone who owns around 65 fast food chains and he took 4 years off of work with the exception of an occasional phone call. 4 years! This while making over 5 mil a year.
So would you invest? Why or why not?