Ten years Quote by Ray Kroc
““Another aspect of the agreement was that I was to charge a franchise fee of $950 for each license. This was to cover my expenses in finding a suitable location and a landlord who would be willing to build to our specifications. Each license was to run for twenty years. My contract with the McDonalds was only for ten years. That was later amended to ninety-nine years. I””
About This Quote
Source Book: Grinding It Out, Ray Kroc, 1974
He describes charging a high franchise fee to cover costs of site selection and custom building, with long‑term licenses extending beyond the original contract.
In simple terms: High fees fund location work and long contracts.
Key Takeaway
Consider fee structures and contract lengths.
Themes
business
franchising
contracts
fees
real estate
Mood
pragmatic
analytical
Type
business
strategic
When to use this quote
- expanding a franchise
- negotiating lease terms
- evaluating investment returns
Key Concepts
franchise economics
risk management
long‑term planning
Questions to Reflect On
- How do fees affect franchisee interest?
- What balance between cost and support is optimal?
A Different Perspective
High fees may deter potential franchisees.
