Starting a franchise during recovering economy takes advantage of low costs

Posted on August 10, 2010 by Franchise Gator Admin

Small business owners are hoping to take advantage of low rents and costs during the economic downturn and expand existing business models through franchising, reports the Los Angeles Times.

Brothers Mendrick and Michael Leelin told the LA Times they hope to expand their Japanese cuisine restaurant by selling the name and business model to other small business owners.

The news source noted that there is a fair amount of former corporate employees who are unemployed - yet have the savings to invest in a franchise.

President of the consulting firm Francorp, Patrick Callaway, told the paper that combined with low real estate prices, even the recovering economy can be a good environment in which to start a business.

Callaway told the LA Times that the low costs “may not be there when the market has healed itself,” and that those companies that invest now “stand to gain the most."

The Leelin brothers believe they have a formula to succeed, and are working with a consulting firm to standardize procedures and operations, the paper reported.

Low rents in prime locations have stimulated several business relocations this year, including the financial company Quicken Loans, which moved to downtown Detroit.