Coffee News is a power-packed weekly publication meant for restaurants, coffee shops that serve the advertising needs of small business. There are, of course, big risks in starting a restaurant of any kind. Only those people who have a genuine love for the business usually stick with it long enough to make a profit; while having a franchise restaurant may ease some of the concerns, there are some realities you need to face before you start.
In the food industry, the franchisee has the prices of goods and costs of labor set against the environment which is price sensitive. Food businesses’ net margins often face the challenge of dealing with theft and spoilage. As a businessman, you must be on top of your game regarding these concerns.
The restaurant industry employs 11 million people, making it the nation’s largest employer outside of the government. The Bureau of Labor Statistics predicts the restaurant industry’s growth will be 30 per cent over the next two years. Industry professionals and owners indicate that the biggest challenge facing the industry is finding educated, competent, and well-trained management personnel to handle this growth.
In the franchising sector, perhaps the most popular and successful are restaurant franchises. More than half of all restaurants in the United States are part of a franchise “family” and they account for around three-quarters of the revenue for the industry. Walk down any high street or visit any mall and you will always find at least one, often several, restaurant franchises. Restaurant franchises have shown themselves to be recession proof and there are many different opportunities to choose from. These include pizza, burger, fried chicken and other fast foods, healthy eating franchises, sandwich bars, coffee houses and many more. The successful strategy adopted by all of these companies and ensuring big profits is that of focusing on their customers’ wants and needs. They have learnt how to satisfy them and how to keep them coming back for more.
Matt Newberg, founder of , a new media start-up covering the intersection of food and technology, says the rise of off-site digital concepts with limited overhead are an existential threat to casual-dining restaurants and independent mom-and-pop shops. He predicts there will only be two types of dining experiences in the future: those in the special-occasion experientialâ€ bucket and those in the convenience bucket, a category that will be dominated by delivery.