Many business owners have dreams of opening up their own restaurant, turning it into a smash success and winning multiple Michelin Star awards, but the reality is a lot more difficult than it seems. Most restaurants fail easily within their first year, mostly due to lack of preparedness, market research or an overconfident menu. There are so many cogs to running a successful restaurant that many first-time owners get bogged down simply by the technicalities, which leaves the door wide open for inefficiency to trickle down from the kitchen to the dining room.
Franchisees know the benefits that come with owning a restaurant franchise, versus starting a new one from scratch. This tried and tested method works wonders when applied correctly, and many franchisees have opened multiple locations due to the enormous success generated. Here’s a few comparisons between owning a franchise location as opposed to going it solo.
BRAND RECOGNITION
Let’s face it – this is the biggest and most impactful advantage franchises have over solo restaurants. The hard work has already been done, and the name is out there for all to see. Patrons are quick to flock to their favorite franchise (especially if they’re in a hurry) rather than taking a chance on an unknown dining establishment. The key takeaway here is that people are just as inclined to visit a franchise as they are a fancy restaurant, depending on the time of day or week. From that perspective, both sides win. However, if you intend to start a solo restaurant, you will have to build your entire name and brand reputation from the absolute bottom of the ladder.
By contrast, people know what to expect from a recognized franchise. They understand the atmosphere, the decor, and most importantly, the food. There’s a greater chance of getting a consistent meal at a franchise as opposed to taking a chance on a solo restaurant. Plus, you won’t have to pay enormous fees to hire branding strategists, designers and coordinators to come up with a solid brand that attracts clientele.
THE PROOF IS IN THE PUDDING
Opening up a solo restaurant means you are working with exactly 0.0% data. The best you can hope for is to analyze the demographics of the area you wish to set down in and then proceed with cautious optimism. This isn’t a bad thing, but it is far riskier than working with a franchise that has already had skin in the game.
Franchisors have already done the hard work when it comes to analyzing market trends, and they have a dedicated higher-up team that consistently shifts and adapts to deal with an evolving climate. They’ll also keep tabs on the political and social spheres to gauge any possible market fluctuations or disturbances. This is something a solo restaurant can do, but you’ll be working within a much smaller and more confined data set.
OPTIMIZED SYSTEMS
Earlier we mentioned first-time restaurant owners falling victim to the pitfalls of the business, and it’s an all-too-common occurrence. Many believe they can simply start a restaurant and enjoy glowing five star online reviews. The reality of running a kitchen is far removed from the ideal picture in your mind. Everything from sourcing and acquiring produce to dealing with training and scheduling must be taken into account.
In comparison, franchisees work within a system that is unified and optimized from the head office downwards. Employee management systems and scheduling are usually handled by software that is considered standard issue across all locations, and the same goes for employee training and guidelines. These are efficient, highly-tuned systems that cut a lot of red tape out of the initial startup so you can get up to speed that much faster.
THE CONS OF FRANCHISING
It’s important to note that no business is perfect – even franchising. There are risks and cons to consider before you decide to take the plunge. The biggest and most obvious is branding. While earlier we mentioned that branding is one of the key advantages of being a franchisee, it also leaves that same franchisee vulnerable whenever the brand takes a knock. This could be a scandal that makes its way into the news, a negative experience at another location that will directly affect how customers perceive the brand, etc. While this is hardly a death-blow to your franchise’s chances of success, it can be disconcerting for business owners who would prefer not to be at the mercy of the other myriad franchise locations, or the actions of head office. Thankfully, this is rare.
Second, you will be expected to pay licensing fees when owning a franchise, and although many might view this as a con, it really isn’t. Licensing fees literally equal peace of mind by allowing you to step aside and enjoy the benefits of a system (and head office) that is working for you. In the end, it’s far less costly both in financial and chronological terms to pay the licensing fees so you can concentrate on what really matters – welcoming patrons into your establishment and sending them home with a smile.
The last is obviously control of the business. As a franchisee, you’ll be expected to work within the system, not against it. This means you won’t be calling the shots when it comes to branding, menu items or standards, although some franchisors are more flexible when it comes to how much leeway will be allotted to you. Just remember that you’re working within a proven and highly effective system designed to yield excellent ROI.
Remember that franchising is all about cutting out the complexities of running a restaurant location so that you can get down to business faster. The success of your franchise location(s) could be the deciding factor in whether you do indeed end up opening a solo restaurant of your own in the future. When/if that day comes, think how much more prepared you’ll be.
To join the St. Louis family as a franchisee, get in touch with us today, and let’s make your location a success!
