As the owner and founder of SCOTT’S FZ, Scott Antel specializes in emerging markets hotels, branded residential and restaurant franchises. With over 30 years of experience, he discusses ROI and franchise investments.
How do you mitigate costs to maximize ROI?
As a lawyer, this isn’t really my area; however, I remain perplexed by the hesitance to invest in energy and environmental savings. In the harsh Middle East environment, this is especially puzzling, despite the higher initial costs. Although these technologies currently cost more than conventional options, the return on investment (ROI) is typically within two to three years. Furthermore, once that period is over, you benefit not only financially but also gain the advantage of being a good corporate citizen. The reluctance to adopt these changes may stem from various factors, but the long-term benefits are significant.
What is your advice to hotels and restaurants that are looking to franchise?
For hotels, given that major brands now primarily manage their brand rather than individual properties, finding a good independent operator is crucial. An independent operator, who works for you rather than the brand, often manages a Marriott better than Marriott itself. Essentially, today you are purchasing distribution rather than management expertise.
For restaurants, it is important to ensure that the brand you acquire focuses on initial standards and training, along with ongoing hands-on quality control and improvements. When dealing with celebrity chef brands, restaurants must consider what that are getting from the name. You might pay a large premium for their appearance at the grand opening only to rarely see them again. Evaluate whether they are overstretched, making you essentially a chain outlet.
What is your approach to structuring and setting up inbound franchise investments across various industries?
For hotels, from the franchisor’s perspective, the key is securing an experienced franchisee partner who has sufficient capital and access to prime locations.
On the other hand, from the franchisee’s perspective, it is crucial to assess whether the brand has experience in the country or region. Additionally, evaluate if they have existing local or regional infrastructure to serve you effectively. Furthermore, consider if they are overloaded and unable to provide the ongoing attention you need and pay for, particularly during the startup phase.
