Couple Hits the Sauce, Finds Barbecue Success
One year and $7,000 later, Ivey opened Virginia BBQ out of a former dress consignment house in Ashland, Va., and began cooking up typical barbecue fare like Texas beef sandwiches, chicken barbecue sandwiches and corn bread muffins.
After a writeup of the restaurant in the Richmond Times-Dispatch as the best barbecue in town, business exploded, and Ivey soon opened a second location. "We had lines out the door," he says. Ivey currently owns eight franchises in Virginia, with a ninth opening in Delaware in about two weeks.
Fast food, the largest U.S. frachise category, has exhibited the most new concept growth since 2003, according to a 2007 report by FRANdata. In a booming sector that includes household names such as McDonalds (MCD) and Wendy's (WEN), Virginia BBQ is doing what fast food does best: keeping business simple and cheaper than the rest.
The Cost Of Good Cookin'
For a restaurant, Virginia BBQ's franchise fee is considerably low, says Eric Stites, founder of Franchise Business Review. "125,000 is a very affordable food concept," he says.
Subway, for example, estimates its startup expenses at around $256,500. According to FRANdata, the average initial investment for a fast food franchise ranges from $200,000 to $2 million.
Virginia BBQ's $20,000 franchise fee includes use of the trademark along with a week of on-site and financial training. Equipment costs factor to about $65,000 and build-out costs -- which include plumbing, electricity and building permits -- come to about $40,000.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV