Restaurants used to be all company-owned, until we invented franchising as a growth vehicle.
Now it's not uncommon to find a restaurant brand that's 100% franchised. Franchising is often a preferred format for larger investors who like the low capital expenditure and high return franchise royalties when they exit (sometimes north of 14x).
There are plenty of ways to grow a restaurant brand, creating symbiotic growth across all channels. Diverse revenue streams allow the brand to live in the lives of consumers with multiple touch points to generate brand awareness and loyalty. They also create more financial stability within the brand and contribute to a possibly higher valuation of the company overall.
So why don't more brands do this? Simply put: They don't know how. Don't worry, we do—and we're here to show you.
Here's just a few ideas for how to grow your brand in alternative ways:
- Product Manufacture Create efficiency and quality control in the back of house, and a retail offering for front of house.
- Wholesale and Retail Product Sales Save some of that manufactured product for use in larger scale retail distribution.
- Work With Your Existing Franchise Offering
Testing co-branded concepts: A great way to explore the benefits of two complementary brands, grab more daypart segments and leverage existing infrastructure.
Satellite and other alternative executions: Similarly, using an existing franchise or company location as an anchor, experiment with remote locations to expand reach.
Develop multi-unit operators from inside your own franchise system: Train your current franchisees and incentivize them to grow with you!
- Brand Licensing Deals When there is existing brand recognition, these deals can augment the brand market presence and add directly to profit margin.
- International Expansion When economic conditions are less than ideal domestically, looking abroad can balance a development portfolio and hedge against stagnation.
- Non-Traditional Development Non-traditional venues (such as airports, arenas, colleges, hospitals, etc.) have very different capital and profit models, but can be a great addition to any portfolio.
Full Course offers expert-level growth consulting for restaurant and food brands at all stages, ranging from ideation to well-established.
If you need support mapping out the possibilities for growth, we can help you consider growth in many areas.