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Things never stay the same. And that’s definitely true in franchising!
In this post, I’m going to go over the changes I’m seeing in food service franchises.
Why is that important to you as a prospective franchise owner? Because you may need to adjust your search for the right food franchise to own and operate.
With that in mind, let’s dig in.
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3 Big Changes Taking Place In The Food Service Franchise Sector
1. Cashless Payment
I had a strange experience the other day.
When I pulled a $10 bill out of my pocket to pay for a ticket to see my nephew play in a high school basketball game, I was told “we don’t accept cash.”
Muttering “I can’t pay with cash?” under my breath, I yanked a credit card out of my wallet, inserted it into what looked to be a fairly flimsy card reader, and waited for the inevitable “Remove Card” indication.
The entire transaction took about 50 seconds. (It would have been only 30 seconds, but since I first tried to pay with cash and had to yank incredibly hard to get the credit card in question out of my brand new, tightly woven leather wallet.)
The experience has led me to make a change.
My credit card is now located in my money pocket for faster retrieval if another of those situations arise.
What does this have to do with food service? A lot.
It's not much of a stretch to believe that more and more food franchises will be going cashless in the not-too-distant future.
One only needs to look at this list of food-service establishments that went cashless during the height of the pandemic to realize this isn't a fad.
Research Tip: Look at food franchise opportunities that have started to go cashless or will be soon, as part of their strategy. Doing so will help you stay ahead of the game.
2. Increased Availability of Delivery
Do you know anyone who didn’t have some of their food delivered during the past year and a half? Me either.
Research Tip: If you’re going to invest in a food service franchise, you need to take a deep dive into their delivery methods.
For instance, is the food franchisor you’re interested in partnering with taking advantage of the latest delivery technology?
Secondly, is the franchisor contracted with any of the companies specializing in food delivery for restaurants? Or are they handling delivery internally?
Finally, ask franchisees what percentage of their revenue is coming from delivery.
If it’s low, find out why.
If their delivery revenue is high, see what they’re doing to increase it even more.
3. Limited Sit-Down Restaurants
Residents in my area haven’t been able to enter their local McDonald’s® restaurant for over a year. It’s all drive-thru and delivery.
In truth, I’m not exactly sure why Tony, the owner, has kept his dining room closed for so long. But since he’s one of the most successful McDonald’s franchisees in Ohio, he must know what he’s doing.
And speaking of indoor dining, I just read about something another large food franchisor is doing.
Burger King® has introduced a couple of interesting fast food restaurant prototypes. One of them includes no indoor dining room. What?
Interestingly enough, a number of other fast-food franchises are coming up with new restaurant designs featuring extremely small dining rooms.
Research Tip: If you’re thinking about buying a food franchise on the upper end of the investment scale, try to get a feel for the direction they’re going, dining-room wise.
And don’t forget to get a timeline of when the new design will launch. That way you can get your financial ducks in a row before you sign on the dotted line as they may be a bit more of an investment of time, money or both.
To summarize, you need to watch the trends and changes taking place, not only in food franchising, but in every sector of franchising.
Because they’re taking place right before our eyes.
<blockquote>“One change always leaves the way open for the establishment of others.” - Niccolo Machiavelli
The Franchise King®, Joel Libava, is a top franchise expert. He’s written over 2,000 different articles on franchise ownership and personally consults with people who are looking to buy a profitable franchise. Go here to find out how The Franchise King® can help you become your own boss.