5 Reasons to Invest in a Restaurant Franchise in 2020

restaurant franchise

Restaurant franchises are some of the best franchises to buy, especially as we enter 2020. But why is that? If you’re thinking of looking into franchises for sale, keep an eye out for restaurant franchise opportunities. We’re going to tell you why.

1. Demographics Are Prime for Boosting the Restaurant Franchise Industry

There are three primary demographics of the population to consider when thinking about the restaurant franchising industry: Millennials, Baby Boomers, and Seniors.

Seniors are aging out of the workforce, either with their own investments or after years of hard work. But they are the primary drivers behind the health and wellness boom we’ve seen a trend of in recent years. While that industry itself is flourishing, it’s also helping to boost the restaurant franchising industry. We’ll go into that shortly.

The Baby Boomers aren’t quite done with their influence on the economy yet, either. Many of them are grabbing up a chunk of the small business market and investing in franchises and other ventures. That means a lot of business meetings, and business meetings often happen over corporate lunches and other meals.

The Millennial Generation is over 70 million strong in the United States, and they’re reaching the zenith of their purchasing power with the new year. They demand a wide range of services and products, and this includes niche restaurants and food items. Many companies, particularly in the restaurant industry, are capitalizing on these consumption trends with great success.

By researching these demographics and the things they’re prone to buying – vegan foods, keto meals and more – it’s hard to see how owning a restaurant franchise wouldn’t be beneficial.

2. Health and Wellness are Huge Selling Points, and Restaurants are Capitalizing on it

Many people in 2019 will continue to be conscious of their mental, physical, and emotional health in 2020. A large part of that will include what and how they eat.

Consumers have become increasingly aware of what foods they’re ingesting, what ingredients may be harmful to them, and where their food comes from. While large chain restaurants and the companies behind them may not always be able to offer local farm-to-table foods, many smaller franchise-ready restaurants can.

So it may well be worth the risk for you to invest in a local restaurant franchise, like Chaps in Maryland, if your local consumer base seems to care heavily about the traceability of their food.

Everyone may not care about eating “healthy,” exactly, so keep that in mind, too. Some people just want a good burger with cheese and bacon, while others want an organic non-GMO salad made of locally-sourced fruits and vegetables. Learn your customer base and choose a restaurant franchise that caters well to those customers.

Alternatively, find a franchise that has both healthy and less-than-health-conscious options. Variety can be key in many instances.

3. Multi-Unit Restaurant Franchises Increase Enterprise Value

All kinds of franchises have noticed a steadily increasing interest by franchisees to open not only one location, but multiple units. This is primarily done by franchisees who want to try their hand at establishing what amounts to a small business empire.

More than half of all of the franchise units in the United States today are multi-unit franchises. This means that multiple franchises are run by one franchisee in the area. Owners of these multi-unit restaurant franchises have one primary thing in common with one another.

They all have chosen to take advantage of a business model that thrives on semi-absenteeism. The semi-absentee business model allows an owner or managing entity to be away from the location while still keeping the franchise under control.

Essentially, they hire general managers to make sure the day-to-day activities continue as normal or better. This frees up the franchisee to focus on the franchise’s growth, business strategies, and oversight of all of the sister locations.

4. Populations are Growing, and People Enjoy Eating Out

The world population clock estimates over 7.5 billion people on the planet. Over 330 million of those people live in the United States, and they love to eat out. The population continues to grow and fluctuate every day, and every one of those people is a potential customer at a restaurant that you could be investing in.

The thing is, food isn’t a niche – restaurants can be themed, or cater to certain diet types, sure. But everyone has to eat for survival.

Investing in a restaurant is almost guaranteeing that you will be able to generate income because inevitably, people will need to eat and won’t want to cook at home.

In fact, the American population on average is more likely to spend money on eating out or ordering in than they spend buying groceries consistently. That means there’s plenty of opportunities to get these potential customers in your restaurant franchise, where they can enjoy a meal away from home.

5. Restaurant Franchises are Great for Growth

One of the primary reasons to invest in a franchise is to generate future income. Whether you plan to retire or just want some extra, significant spending money, future reliable income is important. Restaurants are some of the most successful franchises for this purpose and make them some of the best franchises to buy.

Unlike some investment opportunities, restaurant franchises allow you the opportunity to make back what you invest in it. There’s also more than enough potential for growth, meaning that you could very easily make more than your investment. In fact, on average a restaurant franchise will net you about $65,000 annually.

Additionally, opening multi-unit franchises can further increase your profits and potential for growth. It’s definitely something to think about if you have experience with franchises, or if you have experience relevant to the restaurant franchise you’re hoping to buy.

Conclusion

There are a lot of reasons that you might find to invest in a restaurant franchise. These five reasons are some of the best reasons, from a financial standpoint, to try your hand at a franchise opportunity. Don’t be afraid to start 2020 off as a franchisee!

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