Franchise Feasability Study - Essay Example

Franchise- The Garuva Restaurant Table of contents Chapter and Topic Page Number 0 Introduction 02 2.0 Executive Summary 03 3.0 Organisational History 04 4.0 Suitability for Franchising 06 4.1 Franchise Structure and Growth 09 4.2 Support Services 10 4.3 Franchise Benefits 11 4.4 Franchisee Fee 13 4.5 Potential for Future Expansion 15 4.6 Legal Aspects 15 5.0 Conclusion and Recommendations 16 6.0 References 18 7.0 Appendices 19 1.0 Introduction This report is undertaken to study the feasibility of Garuva restaurant expanding its operations to the cities of Sydney and Melbourne under a franchise agreement. This paper makes an attempt to report an unbiased research while taking into consideration the limitations in print materials available to conduct a full and thorough investigation. The paper will however strive to unearth all possible positives and negatives during the course of this expansive report. Despite limitations in sourcing elaborate details of financial participation, obligations, assets and liabilities, and business ethics, a wider perspective of how and why a franchise may help expand an existing organisation's horizons is dealt with herein. What is a franchise, and how does it work Franchise is a business arrangement undertaken between two parties for the purpose of marketing a product or service. The franchiser (party selling the product or service) enters into an agreement with the franchisee (party buying the product or service) to provide marketing and selling expertise under its banner, for a fee. The franchisee is at liberty to operate in areas not directly under the jurisdiction of the franchiser (Definition: Franchise@ Sterling Knight, Commercial Mortgages, Sterling Knight, www.sterlingknight.co.uk). What are the rules set out by the Australian Franchise Standards to enhance profitability and high standards of personal and professional conduct Does Garuva have the qualities to market their services through franchisees in Melbourne and Sydney What does the Australian Franchise Standards mean in the context of this research, and does Garuva bar and restaurant, meet the suitability criteria of the Australian Franchise Standards to expand its operations through a franchise in the port cities of Sydney and Melbourne The Franchise Council of Australia (FCA) expects its members to maintain a high level of standards in personal and professional conducts, to enhance public perceptions of a franchise. In return, FCA will help safeguard the investment of its member franchisers and the businesses of its franchisees, and protect franchise networks from unfair or unethical attacks. Brisbane, the capital of Queensland, is a well developed, industrial, tourism, and sporting city. This makes Brisbane an ideal destination for holiday makers as well as businessmen, not forgetting the local population that draws as much as 16% of the state's total wages. The same can be said of Sydney and Melbourne. Cosmopolitan cities that they are, Garuva would definitely benefit from operating franchises there. This research will exemplify the business potential in the field of food and beverages and undertake the study of business expansionism through franchise. 2.0 Executive summary Brisbane, the capital of Queensland, is situated to the north of Sydney. It accounts for 10% of the State's total jobs. Wages drawn is equal to 16% of the State's total wages bill. With its industrial areas, international sea and airports, lush green parks, theatres, hotels, outdoor and indoor sports, and tourist spots, which include the world famous Sunshine and Gold Coast, Brisbane is the place to be. An adventurer's and tourist's destination, Brisbane is among the most-sought-after destinations for Australian and international travellers. Approximately 60% of the country's meat export, and roughly 40% of her car imports happens through the Port of Brisbane (Elizabeth Nosworthy, 2001, Brisbane's Importance to Queensland, The Brisbane Institute). For the palate, there are many dining choices. The Brisbane area boasts of numerous restaurants. Added to this are clubs, bars and cafes; like The Club Brazil, The Embassy Hotel and Alice's Bar and Club. If it's happening at night, it's happening in Brisbane. Choose from the numerous budget hotels to the more hype-style ones, to suit one's pocket. Brisbane is a busy hub of activities (Brisbane Travel Guide, Australia, http://www.onlinebrisbaneguide.com). The purpose of this paper is to ascertain the feasibility of Garuva bar and restaurant, also known as the Hidden tranquillity Restaurant, expanding its operations through franchise in the other, more prominent cities, of Sydney and Melbourne. A layman would without a second thought say, yes; it's definitely viable to expand business operations to Sydney and Melbourne. They are the two fastest expanding cosmopolitan cities in Australia, and attract tourists from all over the world. Because of this, Sydney and Melbourne qualify to become ideal business destinations. Analysis in the form of comparison of per capita income among the three cities, their industrialisation, tourism promotion, population growth and its behaviour will help arrive at a consensus in determining the feasibility of this exercise. In order to understand the geographical implications in understanding the importance in location, please refer to the guide map of Brisbane in, City map at (http://www.onlinebrisbaneguide.com/brisbane-map.html). 3.0 Organisational History Garuva Hidden Tranquillity Restaurant was born in the Fortitude Valley in 1992. From inception, this restaurant had its share of regular customers. Garuva has managed to create an image for itself and her clients. This is reflected in the manner in which more and more customers are dining there. To Garuva's credit, many of her clients have been promoting the image and services offered there. So professional has been their business ethics that, word of mouth has been an effective tool in their service promotion. Patronage began to increase gradually, and now, Garuva has become a favourite destination for the local and floating populations of Brisbane. Begun at the corner of Wickham & Gipps Streets, the management sensing an ever growing clientele, decided to spice up their service by introducing a cocktail bar to house those guests who were waiting to go into its restaurant to dine. 10 years on, Garuva, the restaurant & bar, has moved to a more spacious premises at 324 Wickham Street. Along with its ample parking space at the Valley Centre, this multi level car park can be accessed from St Pauls Terrace, Constance and Alden Street. To beat the rush during the evenings, street parking is also made available. The serene surroundings welcome the guests to a world of privacy. Cushioned rugs to sit on with supporting back rests, low tables and dim lights make the occasion reminiscent of one's first serious fling. Tables are enclosed by sheer curtains to elucidate intimacy. Tables to accommodate two and more greet customers. The arrangements can be modified according to the occasion. During weekdays, the mood in the restaurant is conspicuous by its deafening silence, only to be broken on weekend nights, when, the restaurant becomes much busier and loud. Even during this period, the oasis maintains a row of tables for the connoisseur. Apart from this, the restaurant boasts of a private function room which can accommodate up to 30, suitable for get-togethers, parties and the like. To service their customers, Garuva is open all days from 6 in the evening to midnight and stays closed only on certain public holidays. The bar remains open till 2 the next morning. Due to its popularity and demand, the restaurant has to make do with sitting restrictions. Starting Sunday till Thursday, there are no sitting restrictions, however, come Friday and Saturday nights, the restaurant fully booked for 2 sittings, allows the first batch of diners only 2 hours. Most patrons then round of their night by going into the cocktail bar and relax on cushions on the floor, listening to live music (About Garuva, www.garuva.com.au/AboutGaruva.htm) Tranquillity, as the same indicates, is prima facie. Oblivious of the fact that Garuva restaurant respects such prominence, one may find it hard to trace the existence of this restaurant while practically standing in front of it. What gives it away is a small paper note that reads, 'Garuva Hidden Tranquillity' on it. Garuva is housed in a heritage building that took about a year to get a licence for a proper signboard. The entrance is done up remarkably well. The path to the restaurant leads through a tangle of jungle plants, bathed in green light. Tiger stripe bean bags welcomes customers around the cocktail bar. All meals are served at $17.50, mostly Asian, in style. A look at the menu will have the customer licking his or her palate for more. The kitchen cooks up good versions of Thai beef salad, yakitori chicken skewers, lamb shank curry and Singapore vegetables. (Fiona Davies, best restaurants of Australia, de roots, 2006, www.bestrestaurants.com.au). $17.50 is a great buy. Garuva is known for its Asian flavour and people come in pairs and groups to hang out during the weekends. Its popularity has grown ever so increasingly, that it's adviced to make reservations for the weekends at least a couple of days in advance. The menu shows all varieties of chicken, mutton, seafood, salads, and vegetarian preparations. The meat section has Beef Baha, a preparation containing, stewed beef brisket in soy sauce, tomato puree and vegetables; Chinese Roast Beef, a mixture of marinated in ginger, soy, sherry & garlic. Roasted and sliced, accompanied by chilli plum sauce. Lamb Curry is braised lamb shanks with spicy curry sauce. Thai Pepper Pork Lean pork loin marinated in garlic, pepper & fish sauce, pan fried and served on a bed of bean sprouts. Addicted to seafood Try Garuva's Turkish Octopus. It's made of matured pieces of baby octopus sauted in cream, garlic & lemongrass served with a Turkish dipping sauce. Or perhaps, it's the more traditional Japanese chicken of Yakitori Sticks Japanese style chicken kebabs Barbequed to perfection in Garuva's own delicious yakitori sauce. The list is quite laborious and may seem out of place at this point of time. The idea of presenting the above menu was to elucidate the style and taste that Garuva food is renowned for. Match it with its ambience and what more could a fastidious mind ask for Let's not forget that each meal comes at a fixed price of $17.50 making it very attractive. All meals are extraordinarily large, entre size. How is that for a bite Rice is served at an additional cost of $1.50 a bowl, and Cob bread & babaganush served at $3.30 per serve. The bar serves almost all kinds of branded drinks. The menu for that comes separately. (Garuva restaurant and bar, 2006, http://www.garuva.com.au/menu.doc) 4.0 Suitability for franchising What does the Australian Franchise Standards mean in the context of this research Will Garuva in its expansion programme through franchise, meet the suitability criteria of the Australian Franchise Standards The rules governing the standards are elaborate and run into pages, and analysis could take an equal number of pages. Therefore, major points that reflect the current business franchise necessities in Garuva's expansion programme through franchise in Sydney and Melbourne will be looked into. What are the Australian Franchise Standards The Franchise Council of Australia (FCA) expects its members to maintain a high level of standards in personal and professional conducts, to enhance public perceptions of a franchise. They help safeguard the investment of its member franchisers and the businesses of its franchisees, and protect franchise networks from unfair or unethical attacks. The Standards are designed to provide FCA members with an authoritative guide on acceptable standards of conduct. The FCA is well regulated, and the Franchise Code of Conduct (FCC), is a code allowing for adequate dispute resolutions and disclosure provisions to assist and guide within a given sector. FCA is of the view that a member gains significant market benefit in identifying themselves with FCA membership, and as such the business practice and activities of members should work towards best practices. If a member does not comply with Franchise Standards, then disciplinary procedures in the form of termination from membership of the FCA can be initiated. Clause 2.10(1) (b) of the Constitution of the FCA states just about this. The FCA can respond to any complaint alleging breach of the Member Standards by a member, but it cannot under any condition vet documents, audit member behaviour, or police compliance. It can however, refuse liability to any person in relation to a breach of the Member Standards. FCA Standards state that: 1. Members shall abide by all relevant State and Federal laws, including FCC and the Trade Practices Act (TPA). 2. A member shall within 14 days of written request by the FCA furnish a copy of its current disclosure document, franchise agreement and any other documentation or advertising material used in connection with the appointment of a franchisee. 3. No member shall imitate the trade mark, trade name, corporate name, slogan, or other mark of identification of another member of business in any manner or form that would have the tendency or capacity to mislead or deceive. 4. A Member, be it a franchiser, franchisee, franchise broker, or a representative of the franchise system, will not sell a franchise if they knew that a competent franchisee would unlikely be successfully to operate a franchise. 5. Members will refrain from illegal, unethical or improper dealings. And in relation to a supplying member: 1. All supplying members, be it a lawyer, accountant, consultant or product supplier will act in a manner consistent with the above guidelines. 2. Respect the integrity of this tested system, and refrain from inflaming any member disputes, or incite litigation. 3. Provide on request, submit authentic supplier profile to potential franchisees 4. Respect and maintain confidentiality of all business transactions and information which is not in the public domain, unless with prior written consent from their client. 5. Refrain from any unethical practices that may harm or disrupt a franchiser, or a franchisee business development. 7. Refrain from undertaking any work where they have no proper qualification, licence, or experience (FCA, Franchise Council of Australia- Member standards, 2006, www.franchise.org.au). From a humble beginning in 1992 and a seating capacity of 30 to a more sizable seating up to 200 guests, Garuva restaurant has come a long way. What attracts customers to this restaurant is, as its name suggests, a relaxing and ambient atmosphere. The entry through a meandering wooden path with leafy surroundings, and impressive, heavy wooden doors, leaves customers imaging another world altogether. The menu may not be extensive; but the dishes are delicious, sumptuous, and incorporate a range of Asian influences that include Indonesian, Indian, Chinese, and Thai (Garuva Hidden Tranquility Restaurant and Bar-Details, Yahoo Travel, Wcities, 2005, uk.holidaysguide.yahoo.com). What are the prerequisites to open franchisee outlets in unrepresented areas in the same city, or open a franchise in another city Perhaps the following case can throw more than appropriate considerations: Fifi's are among the top leading authentic Lebanese Cuisines. Started in 1999, this business began with an innovative concept never seen before in Australia. The idea was to introduce contemporary Lebanese food here. Fifi backed by her 38 years of cooking experience, started her business in Sydney. Starting right from the music and dcor to lip-smacking French influenced Lebanese food, Fifi began a career that took her to the pinnacle of customer satisfaction and profits. With the idea of expanding her service to other parts of the country, Fifi decided to look for franchisees. The most important factor that needs to be handled is the authenticity associated with her restaurant. In order to comply with franchise rules applicable in Australia, Fifi plans to deliver all restaurant fresh dips, salads and skewers from her state of the art commercial kitchen. This way, customers will get the same taste as from her kitchen. The franchisee will be required to appoint moderately qualified personnel to complete preparation of meals. Service on the lines of Fifi will have to be incorporated. With generous servings and warm service, Fifi's, is a night to indulge in. The same attitude and generosity is expected of her franchisee. The franchise owners have to replicate Fifi's experience from Enmore, in Sydney to other parts of the country. Franchise owners will receive 4 weeks of intensive training; they will receive local marketing support, franchise agreements for 5 years and above are available, and will be required to invest $250,000 - $ 350,000 (Franchise Business Directory of Australia, FCA, Fifi's Caf, http://www.franchisebusiness.com.au/Companies/Fifis-Lebanese-Restaurants-Pty-Limited/153991). 4.1 Franchise Structure and Growth Franchising has come of age. Expanding business horizons and to increase multitude profits at minimal risks, have led many product manufacturers and service providers to seek tie-ups that benefit both signatories. Brisbane, the capital of Queensland, is a fast emerging competitor to its more prominent cousins, Sydney and Melbourne. Boasting of international sea and airports, historical artefacts, large industrial centres, tourist and holiday destinations, and well-served schools, colleges, and universities, Brisbane is a hub of frantic activities. In such a scenario, can the hospitality industry be far behind Hotels and motels, restaurants and fast food joints have mushroomed all over the city. However, food is one product that has no saturation. Competition, yes, but then, healthy business helps improve quality. This is precisely what Garuva strives to promote. Brisbane, a fledging metropolis is on the fast track. Therefore opportunities have opened up and with it opportunity seekers. In such a scenario, restaurants have through healthy competition tried to be as innovate and unique to attract more patronage. With limited resources available, restaurant owners have turned to franchise operations to sustain and improve their market share. With its laws governing business ethics, Australian restaurant owners have turned to FCA to protect the interest of both the franchiser and franchisee. This has helped all concerned. Sydney and Melbourne are major international destinations for the business-class, tourists, adventurers, educationists, migrants, and Australians themselves. This has put enormous pressure on the local administrators and planners to expand its boundaries. Continuous growth has helped restaurant owners also to find space to reap rich dividend. This automatically attracts the big players to invest in infrastructure. Without having to invest in infrastructure and minimise risks, Garuva can improve their income and image by appointing franchisees. Thus, Garuva is an automatic choice in expanding its business operations to Sydney and Melbourne 4.2 Support Services A franchiser enters into an agreement wherein, the franchiser leases his brand name and expertise to the franchisee for a sum agreed to by the franchisee. A potential franchisee will obtain marketing and training support along with business know-how from the franchiser. The following points will be adhered to by the franchiser and franchisee: 1. A franchiser will investigate a prospective franchisee's industry skills and resources to fulfil and perform to industry standards, before appointing it. . 2. The franchiser must have the required training and support mechanism in place; to support the prospective franchisee in their operations and business development. 3. Franchiser and franchisee should be accessible and responsive to ideas and communications at any given point of time. This will bolster understanding and mutual benefits. This will also help resolve complaints, grievances and disputes, such as overvaluation of fees and services, and illegitimate business transactions that could harm the franchise network as a whole. Garuva in the quest for business expansion can assist its franchisee in design and management. Garuva is known for its ambience and closeness to nature. This must be a prerogative at its inception. Customers will look to identify the name with nature and tranquillity. Garuva must be able to present its franchisee's interior on equal terms. Training of personnel to prepare and service their customers is utmost important. This must be on par with the flagship restaurant in Brisbane. Garuva has never invested in advertisements. It has from its inception, promoted its service through word of mouth. However, this may not be a viable solution in a cosmopolitan city like Sydney or Melbourne, where professionals work tirelessly to attain perfection. Thus, the franchiser must deviate from trusted practices and involve in marketing strategies that are appropriate to that situation. In a franchising arrangement, the initial degree of contact between the franchiser and franchisee is intense because it is during this stage that most franchisee's outlet requires most assistance. Besides, to become a franchisee, one does not necessarily have similar industry experience. The franchiser and franchisee will develop a communication network through email, inter/intranet, phone and fax to maintain day to day activities. Regular meetings to upgrade existing products and services will be initiated. In short, the franchiser will work in unison with the franchisee to maintain high quality and standards. A key factor in the success of a franchise is the ability of the franchiser to offer its franchisee superior level of service. 4.3 Franchise Benefits A franchiser will sign a contract with a potential franchisee with the belief that their business association will bring mutual benefits. For the franchiser, a franchise is a basis to increase profits and image without taking undue risk. FCA rules governing franchise developments makes sure that the interest of both parties (franchiser and franchisee) are covered and that such an arrangement will bring better returns. As a franchiser, the benefits are more pronounced, as the franchisee has to pay a fee towards brand usage, royalty, and product use. Franchiser will also have the cushion to expand and multiply income through risk free franchisee operations. A franchiser will not have to invest in infrastructure and personnel to increase profits. However, the idea of a franchise is not just to benefit the franchiser, but the franchisee as well. For the franchiser: 1. Increase distribution with minimum capital investment. 2. Establishing local franchisee outlets will be readily accepted by the area community. 3. Franchisees maintain their own staff, reducing overhead expenses. 4. Franchisees are on contract and are therefore obliged to purchase equipment and/or supplies through them. 5. Franchisers have a control over franchisee operations. For the franchisee: 1. Franchisee enjoys the benefit of instant recognition as an established brand. 2. Access to time-tested professional training, and advice. 3. Require no time to build brand equity. 4. No previous experience required to start business. 5. FCA rules reduce risk or failure to the business. 6. Inveterate research and service development, the best in the industry. 7. Right to territorial jurisdiction, in event of further expansion. 4.4 Franchisee Fee: Projecting franchisee income and determining franchisee fees is one of the most difficult propositions to make in business. Michael H. Seid1, in Franchise Chat.com reveals a few possible options, its complexities and methods in determining this. Fees, he feels represent an inherent weakness to the franchising strategy. All business houses alter their products, merchandising or service to improve their profit margin. In consultation with suppliers, they manage to reduce raw material costs and manage internal expenses. These are standard business strategies. These supplements are to a great intent, non-existent in franchisee negotiations. Once franchise fees, royalty rates, or other fees are earmarked and put on paper, to re-evaluate the contract becomes difficult. Adjustments can be made before signing new franchisees, and renewals. Establishing a franchisee fee requires a lot of thought. Setting high fees could bring low profits and endanger franchise opportunities. Setting them too low will bring the franchiser insufficient revenue and disrupt professional service to the franchisee. Therefore, there must be a process to justify rates to ensure mutual profitability. There are many fields under which franchisee fees can be collected: 1. Security deposit 2. Breach of agreement 3. Franchise fees 4. Site location and development related fees 5. Equipment and inventory fees 6. Promotional materials 7. Royalty 8. MIS and POS licensing fees Apart from these, there are other fees such as Contract Renewal fees, Transfer fees, Advertising and Marketing fees, and Penalty fees. The determination of the fees should therefore be made after a strategic examination of the entire franchise system. As the future of the franchise system rests with the profitability of its franchisees, this analysis into the franchisee financial performance will help project franchisee fee. Therefore, initial franchisee introduction fees could include, costs on recruiting, training, site selection, site development, and initial field services, Franchisee continual service costs could field services, home office support, research and development, and corporate expenses. This workout should throw sufficient light on how to arrive at a satisfactory franchisee fee structure. Royalty is a cushion to mix and match. By identifying which fees will be user based and which will be in general services, royalty can be calculated (Michael H. Seid, Determining Fees and Other Pricing Issues, Franchise Chat, 2006, www.franchise-chat.com). For decades, Americans have hogged over their classic hot dog. Hot dogs from frankfurter, frank, or wiener are well renowned. Mandler's has gone a step ahead by upgrading their hot dog into a high quality 9 " long European-style sausage alternative. Served as a full meal and at a reasonable price, this delicacy provides outstanding, tasty, filling and appetising feast. This franchise is up for grabs. Mandler's require minimal support staff, has no parallel competitors, and is simple to cook. Required investment: US $ 50,000 Year of inception: 2003. (Mandler's the original sausage co., Franchise Online, 2006, www.franchiseonline.com). Percent of franchisors charging an implicit or explicit initial fee Initial fee Accommodation, cafes and restaurants 100.0 40 000 (Source: Frazer, L. 1996, 'Franchise Fees', Research Report, USQ, Toowoomba) 4.5 Potential for Future Expansion Most franchisers expand their business horizons to other parts of the city, state, and country. Though this may not be uniform, franchisers wait to see the response and profitability, before growing gradually. Qualified personnel and franchisee support facilities have to be taken into consideration before further expansion programmes can be initiated. Garuva with its marketing expertise and support facilities could opt to begin franchisee operations in Sydney or Melbourne first, before deciding on opening another restaurant. Operational viabilities would also have to be taken into consideration. Thus, though the potential to expand operations through more franchisees are bright, it is adviced to increase brand presence gradually. Major cities have tremendous business potential. Industrial centres, tourists, business centres, frequent travellers, and the local population will all contribute to the growth. Therefore growth is paramount to business success. 4.6 Legal Aspects Legal aspects associated with franchising in Australia are regulated by the Franchising Code of Conduct (FCC). FCC mandates that every franchiser must supply their franchisee with all documental proof pertaining to the contract, such as the Disclosure Document that contains detailed information on the executed franchise. FCC, enacted in 1998, provides a framework for franchise systems to develop conflict resolution techniques, which emphasises mediation as a dispute resolution technique. The FCA is well regulated, and the FCC allows for adequate dispute resolutions and disclosure provisions to assist and guide the members within a given sector. FCA works towards members' business gains, and as a rule, directs its members to good practices. FCC also states that if a member does not comply with Franchise Standards, then disciplinary procedures in the form of termination from membership of the FCA can be initiated. Refer Clause 2.10(1) (b) of the Constitution of the FCA. The FCA can respond to such complaints that allege breach by a member, but it cannot under any condition vet documents, audit member behaviour, or police compliance. 5.0 Conclusions and recommendations Brisbane, the commercial capital of Queensland, is among the most developed and pretty cities in Australia. The world famous Gold Coast is just of its coast. Well developed sea and airports makes access to this city well within one's reach. This makes Brisbane an ideal destination for holiday makers as well as businessmen, not forgetting the local population that draws as much as 16% of the state's total wages. Approximately 60% of the country's meat export, and roughly 40% of her car imports happens through the Port of Brisbane, an indication of the city's commercial value. Industrialisation, Tourism, Sports, and Business opportunities make Brisbane, a viable destination for business and fun. Sydney and Melbourne are definite viable destinations for business. They are the fastest expanding cosmopolitan cities in Australia, and attract business, migrants, sportsmen, and tourists from around the globe. What do businessmen look for to launch or expand their business A healthy economy, well organised infrastructure, business opportunities, and population, not necessarily in that order. Sydney and Melbourne qualify automatically on these grounds. The Australian Bureau of Statistics in their 2001 report declared that the estimated resident population in these states were: New South Wales had a population of 6,568,902 in 2000 and 6,642,879 in 2001, an increase of 1.1%. Victoria had 4,791,268 in 2000 and 4,854,133 in 2001, an increase of 1.3%. At the same time, Queensland had a population of 3,603,043 in 2000 and 3,670,459 in 2001 (3101.0 Australian Demographic Statistics, Dec-2001, Australian Bureau of Statistics, 2006, www.abs.gov.au). The majority of these people live in the cities of Sydney, Melbourne and Brisbane. This gives a fair indication of the market potential in these cities for business development. Garuva, a unique Asian-styled (literally) restaurant, is among the best in Brisbane. Their business has grown by leaps and bounds that, one needs to plan in advance to get a seat during weekends. Word of mouth marketing has been their forte. Repeated customers and growing clientele had necessitated a move to a more spacious premise. The menu is not very elaborate, but the taste and ambience is par excellence. From a humble beginning in 1992, Garuva today has a capacity to seat 200 customers at a time. Competition has not been detrimental in their quest for perfection. Tranquillity is their trademark. Garuva bar and restaurant, also known as the Hidden tranquillity Restaurant, can definitely expand their operations to the cities Sydney and Melbourne. Recommendation: Franchise is obviously the way to go for Garuva. Limited risk, high returns, and expanded business presence, just what more could the management ask for The rules put forward by FCA will help in streamlining operations, negate any uncertainties, and bridge any differences among the partners. Garuva thus must become a part of the FCA. Garuva should make an effort to go one step at a time. It pays to be knowledgeable and this is precisely what the management can hope for by expanding operations from one city to another over a period of 'probing'. 6.0 List of references 1. Elizabeth Nosworthy, 2001, Brisbane's Importance to Queensland, The Brisbane Institute, http://www.brisinst.org.au/papers/nosworthy_elizabeth_economy/transcript-Brisbane.html updated 2005 2. Brisbane Travel Guide, Australia, http://www.onlinebrisbaneguide.com 3. Definition: Franchise@ Sterling Knight, Commercial Mortgages, Sterling Knight, http://www.sterlingknight.co.uk/glossary/define.aspid=1059 4. Fiona Davies, best restaurants of Australia, de roots, 2006, http://www.bestrestaurants.com.au/restaurants/qld-brisbane-garuvahiddentranquility.htm 5. FCA, Franchise Council of Australia- Member standards, 2006, http://www.franchise.org.au/content/id=205 6. Garuva restaurant and bar, 2006, http://www.garuva.com.au/menu.doc 7. Garuva Hidden Tranquility Restaurant and Bar-Details, Yahoo Travel, Wcities, 2005, http://uk.holidaysguide.yahoo.com/p-travelguide-81695-action-describe-garuva_hidden_tranquility_restaurant_and_bar_brisbane-i 8. Australian Businesses for Sale, Food, Restaurant, Caf, Wine Businesses for Sale in Australia, Cathryn Austin, 2002-2006 http://www.bestbusinessbuyes.com.au/food_restaurant8.htm#cafe_braidwood 9. Franchise Business Directory of Australia, FCA, Fifi's Caf, http://www.franchisebusiness.com.au/Companies/Fifis-Lebanese-Restaurants-Pty-Limited/153991 10. Michael H. Seid, Determining Fees and Other Pricing Issues, Franchise Chat, 2006, http://www.franchise-chat.com/resources/fees_and_pricing_1.htm 11. Mandler's the original sausage co., Franchise Online, 2006, http://www.franchiseonline.com/cgi-bin/profile.phpkey=150799 12. Frazer, L. 1996, 'Franchise Fees', Research Report, USQ, Toowoomba 13. 3101.0 Australian Demographic Statistics, Dec-2001, Australian Bureau of Statistics, 2006, http://www.abs.gov.au/Ausstats/abs@.nsf/e8ae5488b598839cca25682000131612/c85cbe3e5e0f324bca256a16008312f7!OpenDocument 7.0 Appendices Trios franchise shows hard work really pays off The son of Lebanese immigrants and founder of the Trios franchise, Elia, born and bred in Melbourne, began his business venture at the age of 19, taking over a caf called Double Jays in Puckle Street, Moonee Ponds in 1985. Elia's first self-managed caf employed six staff. He saved every cent he earned to put towards larger plans. "By starting from humble beginnings I have learnt lessons about management that I would not have otherwise discovered," he maintains. A year after the caf began to soar in popularity and together with his two brothers, did he form the Elia Group and venture into property development. After six years managing and operating property development business, the up-and-coming businessman noticed another opportunity during the rebirth of the city's caf society. "I do remember the time when the latt came into fashion and casual dining really grew in popularity; I saw this opportunity and wanted to grab it with both hands," said Elia. In 1991 he started one of the first 'retro' cafs in Melbourne, offering locals a simple and comfortable dining experience. He introduced focaccia to Australian dining, a way to provide customers with food that was easy to eat and quick to prepare. After 10 years of operations in Melbourne's inner city, Elia realised he had to change. After much research and product development, he started Trios. "It's always important to be fully aware of consumer trends and changes in the marketplace. The food industry has experienced a great deal of transformation over a short period of time," he said, and continued, "The establishment of Trios coincided with the boom in fast food industry and the that trend continues to soar in popularity." Elia helped develop Trios' signature product, the Laff bread, created with special ingredients to give it a great flavour without being too dense. The Laff bread lends the focus of the wrap to the fillings and is low in fat and salt and high in fibre and available in three styles. In just over two years Elia's pet project, Trios, has grown to encompass 12 stores operating throughout Melbourne with a forecast of 50 by the end of 2006. The Trios franchise has been well thought-out and established to develop a fresh and fun business that fills a need in the marketplace (Franchise Business Directory, Trios franchise shows hard work really pays off, FCA, www.franchisebusiness.com.au). Read More