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6 Differences Between Restaurant Franchise Ownership and Traditional Restaurant Ownership
If you’re thinking about getting into the restaurant business, then you’ve got two options: You can start your own restaurant and work hard to build it from the ground up, or you can invest in a restaurant franchise. The following are six differences between owning a traditional restaurant and franchise ownership:
Topics of Discussion
- A Restaurant Franchise Has an Established Menu
- A Restaurant Franchise Has Established Branding
- Restaurant Franchisors Provide Support to Franchisees
- Restaurant Franchisees Benefit from an Established Marketing Plan
- Restaurant Franchises Have Established Customer Bases
- Restaurant Franchisees Don’t Need Extensive Food Service Knowledge
1. If you decide to start your own restaurant, then either you or your chef will need to create a menu. This is a lot more difficult than it sounds. You’ll need to take into account all kinds of factors, including the type of restaurant you’re running, the type of food your target customers want, and the cost of the ingredients versus the price range of your menu. Not to mention that you’ll most likely have to tweak your menu over time. With franchise ownership, the menu is already established.
2. Customers will already be aware of your restaurant franchise because the franchise has an established brand. This will make attracting new customers much easier than when building a restaurant from the ground up. If you own a traditional restaurant, then you’ll have to work extremely hard to establish your brand identity and to increase brand exposure.
3. A high percentage of traditional restaurants fail within their first year. It’s the nature of the business—traditional restaurant owners often don’t have the experience or the resources to navigate many of the obstacles they have to overcome to ensure their restaurant survives. With franchise ownership, you’ll have the backing and support of the franchise. This means that you’ll receive the training that you need to manage your restaurant franchise effectively. In addition, the franchise will be able to guide you through any obstacles you encounter.
4. Trying to figure out how to market your traditional restaurant to attract new customers is extremely challenging, especially if you don’t have a marketing background. You risk wasting a lot of resources on advertising that simply doesn’t work. Franchises have established marketing plans that have been proven effective, which means that all you have to do is follow your franchise’s marketing plan. You’ll also benefit from the franchise’s national marketing campaigns, in which you may not even be involved.
Disclaimer: This information is not intended as an offer to sell, or the solicitation of an offer to buy, a franchise. It is for information purposes only. Currently, the following states regulate the offer and sale of franchises: California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Oregon, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin. If you are a resident of or want to locate a franchise in one of these states, we will not offer you a franchise unless and until we have complied with applicable pre-sale registration and disclosure requirements in your state. Franchise offerings are made by Franchise Disclosure Document only.
