Franchises with best cash flows are disclosed

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Franchises with best cash flows are disclosed

A survey identified the franchises in Korea with the greatest daily cash flow and the winners are:

* Paris Baguette for bakeries.

* GS25 for convenience stores.

* A Twosome Place for cafes.

* Kyochon Chicken for chicken shops.

The survey, put out by the government’s Fair Trade Commission, is meant to help potential franchisees choose their business opportunities carefully.

“In the midst of an economic downturn, demand for franchise start-ups is increasing among retired baby boomers,” said an official from the franchise industry, which cooperated with the FTC in the writing of the report. “But it is difficult for people to find businesses with steady sales and revenues.”

The report said that based on the data from the end of last year, the average daily sales of a Paris Baguette outlet is 1.89 million won ($1,743), which translates into annual sales of 690 million won, much higher than that of the average branch of rival Tous Les Jours, which pulls in 1.08 million won a day.

However, start-up costs are much higher for Paris Baguette branches, an average of 276.3 million won compared to Tous Les Jours’ 193.5 million won.

For convenience stores, sales of GS25 were slightly higher than those of other chains.

Average revenue per day for the 6,502 GS25 stores nationwide were 1.43 million won, followed by 1.39 million won for CU’s 6,544 stores, 1.36 million won for Ministop’s1,641 stores and 13.3 million won for the 3,022 7-Elevens.

The FTC recommended potential franchisees to carefully examine business agreements with the chains because there might be exaggerated or false information on projected sales and profits.

By Kim Jung-yoon [kjy@joongang.co.kr]

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