The franchise restaurant business and thrive in a specific location
It’s really not hard to figure out which franchises are the most successful. You see them advertised everywhere, and cannot drive through a shopping canter anywhere in the UK without passing one or more of them.
Not only do you know who they are, you have probably been in some of them so many times that you know exactly what they have to offer. These franchises, in other words, have succeeded wildly in branding their products. What are they?
Franchise restaurants, of course. Anybody borne after 1955 probably cannot remember a world in which McDonald’s didn’t exist, and they were only the beginning. If you are one of the millions of people thinking about breaking away from the nine-to-five routine and starting your own business, you could do much worse than a franchise restaurant.
Why? Because given the choice of trying to establish a loyal customer base for a new, unfamiliar product of your own choosing, and going with a restaurant franchise with food already familiar and proven to keep the customers coming back, the odds are definitely on the side of the franchise restaurant.
Read more about independent Vs franchise here.
The Pros and Cons
There are, of course, big risks in starting a restaurant of any kind. Only those people who have a genuine love for the business usually stick with it long enough to make a profit; while having a franchise restaurant may ease some of the concerns, there are some realities you need to face before you start.
First, buying a franchise restaurant can be very expensive; they can include actually buying the land on which you will build your operation. You may be able to get help with your financing from the franchisor, and banks also realize that a restaurant franchise is one of the less risky small businesses, so may be willing to give you favourable terms.
On the positive side, you will have the advantage of selling only those foods which are proven money-makers, so you can limit your inventory, which will be ordered from the parent company’s preferred suppliers. You and your company’s other franchisees in the area can share the costs of joint advertising.
On the downside, be prepared for long hours at your franchise restaurant; as a franchisee you will have certain standards, both service and financial, to maintain, and you will be giving regular reports to your franchisor. If you have personnel shortages, you and your family members will have to fill the gaps.
You can almost count on having personnel problems; low pay and unchallenging work will make it hard to keep employees for extended periods. Restaurant employee turnover is extremely high. But if you and your family are willing to supply the elbow grease, your chances of succeeding with a well-established franchise restaurant are better than they would be in any other business you could start.
Finding out if the restaurant will thrive in a specific location
Finding out if the restaurant will thrive in a specific location is important in ensuring the success of your business. To do this, you must do the following steps in surveying the neighbourhood:
Do a physical survey of the location. Spend time to view the people in the area. Other factors such as safety, cleanliness, and the like may also be factored in.
Check out the competition. Are there similar businesses established in the area? Find out the status of their business.
Get feedback from the people in the community. You may administer surveys in the place to be able to analyse the behaviour of your target market.
Determine spending activity of target market. It would be advisable to do a market study of the area where you intend to locate your restaurant. See the previous chapter on Market Analysis.
Foresee potential problems.
If you decide to set-up the business in the said location, will there be any problems in the future?
Find out the limitations and restrictions of the given space. Match your requirements from the space needed to put up your restaurant with what is available and accessible with the given space or location. Are they a match?
Do the math! Determine the projected costs of setting up the restaurant in the desired location. Factor in the cost of rent, equipment, labour, and the like.
Analyse traffic flow and accessibility. Is the space accessible by foot or by means of transportation? It is important to know how your market will be able to go to your location.
Depending on the nature of your restaurant, the factors involving the decision to locate your business will also vary. Remember that what may work for one type of business may not work for another. The reason being that not all businesses function alike and not all have the same target market. Thus, these variations must be considered in making decisions regarding the restaurant business.
It really is all about finding that perfect match between your business needs and with what a locating can offer your business. Finding the right location may not be easy but it’s important to ensure your business’ success can’t be overemphasized. Be patient and you’ll soon find the most suitable area to house your business!
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