Marketing 2014 17th Edition by William Pride,Ferrell

Exercise 5

Five Guys Burgers and Fries is one of the fastest growing fast food franchises in the United States. Started as a single burger joint by Jerry Murrell and his four sons-the "five guys"-in Alexandria, Virginia, the company now has more than 1,000 franchised outlets around the nation. Start-up costs for a Five Guys store range from about $150,000 to $300,000. A $25,000 franchising fee must also be paid, and ongoing royalties stand at 6 percent of sales.
Making one of these fast-food restaurants work, therefore, means acknowledging three major requirements of retailing: location, location, and location. Indeed, to recover start-up costs, and, of course, generate a profit, getting people through the door is paramount.
Franchises (like Five Guys), traditional and online retailers, and other types of channel members are all concerned with this idea of traffic. Once conducted almost exclusively by hand using "clickers," traffic is now measured using a variety of electronic and mechanical devices. One of the greatest advantages of the Internet is the ability to track online traffic behaviors. There are many consulting companies that specialize in measuring pedestrian and vehicular traffic. Most commercial real estate agents and property developers/managers use traffic data.
If you were considering becoming a Five Guys franchisee in your region, what would be the best location? What are the major factors affecting your decision?