Wendy’s, Burger King franchise empires are going bankrupt. Is the fast-food model broken?

Is the beloved American fast-food-franchise model facing a reckoning?

Click here to read the story at fastcompany.com.

Discussion Questions:

1. What is a franchise?
2. What is a franchisor?
3. What is one example of a franchisor discussed in this news story?
4. How might a fast food franchise represent an entrepreneurship opportunity?
5. What risks might be associated with owning a fast food franchise?
6. What is bankruptcy?
7. What is a business plan?
8. The headline of this story asks if the fast-food model is broken. Why might it be important to revisit a business plan if companies are going bankrupt?
9. Based on information from this story, why are some fast food franchises going bankrupt?
10. What is profit?
11. What is profit margin?
12. This story suggests the fast food industry is notorious for “thin” margins. What does that mean?
13. What are some of the costs that are making it difficult for fast food franchise operators to make a profit, according to this news story?
14. In your opinion, do you think fewer people will invest in opening fast-food franchises unless adjustments are made to the existing business model? Why or why not?