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Friday Franchising News - March 18

Catching up on the latest news

It’s a fact that the only constant is change. To say that this is true for the competitive world of franchising and business opportunities is an understatement. This Friday, new dining delights and expansion endeavors are what’s on the menu, served up with a side of standing strong for small businesses. Grab a cup of coffee and read on for the latest installment of Friday Franchising!

Restaurants Battle to Become Your Breakfast Bestie

Breakfast is the hottest time of the day thanks to the recent efforts of fast food giants. The competition is fierce as quick serve heavyweights vie to win coveted customer loyalty. Taco Bell has seen the vacancy in dollar menu offerings and introduced 10 breakfast items for $1 each on their new discount menu. Dunkin Donuts has worked on rounding out their menu with a wider variety of breakfast sandwiches and Starbucks is testing the waters for new delights. McDonald's has acknowledged the future will hold a “customer-designed” loyalty program with better rewards to utilize its large user base. These moves are supported by the facts of a recent study by AlixPartners that revealed 51% of U.S. adults surveyed said more chains should offer breakfast all day. What's more, 50% said that even chains that do not already have a breakfast platform should offer all-day breakfast.

Wisconsin Stands Firm Against National Labor Relations Board

The NLRB’s decision to change 50 years of federal labor law and legal precedent hasn’t been welcomed with open arms. Wisconsin is the most recent state to assert itself against the unexpected move. Governor Scott Walker has signed Senate Bill 422, a new law that clarifies franchisee and franchisor employees are separate entities.  So far, nearly a dozen states have stepped up against the federal government’s attempt to alter long-standing joint employer standard for all franchise small businesses. Acknowledging the needs of small business owners and the impact franchises have on state economy is a theme that will continue to be expressed on an individual basis by states.

SONIC Drive-In Finalizes Deal to Say Aloha to Hawaii

The nation’s largest drive-in restaurant chain is preparing for a new milestone as the franchise announced a development agreement through North Shore Provisions, LLC for Hawaii. This will be the brand’s 46th state and first offshore expansion. Seven SONIC Drive-Ins are planned in total, with Oahu set as the site for the premiere location. Bringing a taste of the mainland is what it’s all about for North Shore leader and Hawaii native, former NFL Baltimore Ravens defensive lineman Ma’ake Kemoeatu.  Kemoeatu is excited to introduce this fast food favorite to his family home, continuing Sonic’s tradition with five consecutive years of positive same-store sales growth.

Taco Bell Sets Sights On China to Complete Fast Food Trifecta

Fast food behemoth, Yum! Brands has been making good in moving forward with their plan for continued growth in China. Yum already operates over 7,000 restaurants in China, composed mainly of KFC and Pizza Hut. The company has slated the first Taco Bell to arrive in China by the end of the year. A spinoff company, Yum China “a China company with Western roots,” has been made to ensure that the expansion in China will be a success. Launching Taco Bell is part of a wider initiative to make all three “global iconic brands,” according to CEO Greg Creed. Only time will tell if China gives a warm reception and embrace bargain burritos and tacos with a twist.

Growing Demand in Fast-Casual Channels Wild West Atmosphere

There may not be gold flowing in the traditional sense, but the rapid growth of of fast-casual chains has spurred a rise in lease rates. This is economics 101: increased demand results in higher prices for premium spots. The competition is fierce and many concepts seek out the same type of spots, 2,0000-3,500 sq. feet in urban areas and suburban strip malls. According to the most recent data from the market research firm NPD Group, the number of fast-casual units increased by 5 percent in the fall of 2015, to 19,043 locations, from 18,176 units a year earlier. The downside is that higher lease rates may prove problematic if sales decline. Chains are realizing they need to understand the capabilities of their concept and be open to target smaller populated markets and remain flexible in their store layouts.

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