Whether you are a new or experienced entrepreneur, selecting a restaurant franchise can be a daunting task. While hard work and perseverance are important to success, understanding your niche in the market is critical. Having a plan in place for how you will operate and grow your franchise during a tough economy will help you outlast the competition.
According to a U.S. Department of Labor expenditure survey, consumers spent an average of $2,698 per year on eating out in 2009. However, the wrong restaurant franchise location can quickly turn an investment into a loss. Before selecting a franchise, do research on demographics and location. For example, if space is available to rent in a shopping center in a college town near student apartments, selecting a Little Caesar’s pizza franchise would be a smart investment.
Consider your budget when selecting a restaurant franchise. Restaurant franchises with more extensive resources to develop marketing and training programs will be more expensive to buy into. Less expensive franchises may be appealing to first-time franchise owners, but can take longer to turn a profit.
Do research on the feasibility of your proposed restaurant location. Get familiar with your County’s General Plan, which is the framework for decisions on developing land in the future. Pay particular attention to the General Plan’s maximum allowable density of development for commercial and industrial use. Obtain a copy of the local zoning ordinances by calling or visiting the County Planning office. Zoning ordinances will help you plan whether your proposed restaurant meets requirements for setbacks, parking, square footage and building height. Join a local business network to meet other local business owners and keep in touch with the community’s future growth. This information can also help you make a decision on when to make the big investment once you’ve decided which franchise to choose.
Consider the availability and locations of other businesses with potential for targeted traffic and co-marketing. For example, if you are considering a Cousins Subs franchise, being located near a gym offers opportunities to co-market products and services for health conscious customers. When trying to decide between restaurant franchises, make sure vehicle and foot traffic is available for your particular niche at the location you are considering.
As with any career opportunity, consider your goals and career path. Do you envision entering the franchise business as a stepping stone for owning your own restaurant? Select a franchise with excellent marketing plans and training programs. If you plan to be in the game for the long-term you may select a franchise based on the potential for future growth and expansion in your geographic area.
Being successful in restaurant franchises can be rewarding, especially if you have been smart about researching location, assessing community needs, and networking with experienced individuals in the restaurant industry. The International Franchise Association Educational Foundation predicts that in 2012, franchised quick-service restaurant sales will increase by over 4 percent. The same report forecasts the U.S. Gross Domestic Product to increase only 1.8 percent in 2012, while the housing market will continue to experience a gradual recovery.