• Wed. Nov 30th, 2022

How COVID-19 brought innovation to the restaurant franchise market


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COVID-19 has hit us all like a ton of bricks – dealing a blow to brick and mortar food establishments with it. The now infamous 2020 pandemic has pushed the restaurant industry to its limits, shattering moms and dads – and some of them for good.

While we mourn the loss of many, the few and the powerful have remained, expanding concepts beyond normality and ushering in a new era of innovation out of necessity. We’re seeing brands that weathered the storm stealthily take over empty real estate and revitalize downtown areas through their franchise expansion.

What does this mean for the restaurant industry? This means new sources of income that increase the value of the franchise and new convenience for the consumer. Let’s take a look at a few ways the restaurant industry has adapted to this unprecedented situation in these unexplored times.

Virtual restaurants on the rise

One franchise adaptation we’ve seen is the rise of the virtual restaurant. This is by no means a new concept, but we are seeing the first of its kind entering the franchise business, offering compelling value and a delivery model only to franchisees. In a shared kitchen space or an existing restaurant, franchisees say goodbye to decorating expenses, ambience issues and the headaches of friendly hires. Innovation is moving to touch screens from which orders are received from third-party delivery platforms. The Local Culinary, one of our most recent franchisors with whom our Franchise Marketing Systems team has worked, boasts the title of “first ghost cooking franchise”. This particular brand has over 50 brands and two models to choose from: an addition to an existing restaurant to increase revenue or start from scratch. This leads well to our next point of discussion.

Take out takes the crown

Since restaurants took the hardest hit at the onset of COVID-19, brands have had to adapt quickly or die. Restaurateurs have expanded beyond the limits of the norm, tapping into unexpected ways of on-the-go experiences. Franchises like Zaxby’s and Chick-fil-A offer full family meals. We’re seeing a boom in GrubHub, DoorDash, and UberEats, streamlining their usability and giving the ever-popular gig economy a boost.

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The operational processes within these companies – and remember, the LOVE process of franchises – were forced to become more efficient for their take-out offerings, essentially reducing the fat that was there from the start. Invention is the mother of necessity, my friends. In some cases, established foodservice operators have shifted entirely to the foodservice delivery model in the case of LoCo, a foodservice delivery service franchise that aims to compete with established brands in the space like UberEats and GrubHub. . Their point of view, support restaurants with lower commissions and a business that aims to serve food and beverage service providers.

Drive and dine outside

Who doesn’t love a good food truck? Especially with limited seating in catering establishments causing overcrowding, food trucks have retained their charm due to their intrinsic value at outdoor events, private parties, essential workplaces, and more. Even the obstacle of site selection is thrown out the door as more food truck companies innovate and develop by franchise. Food trucks made their way into the franchise market in 2020 thanks to creativity and affordability. Brands like Benevento understood the opportunity that social distancing brought to the restaurant industry and adapted its model to be affordable for entrepreneurs looking to leave their dying businesses and go into the thriving ones.

Each of these brands has chosen to expand into new markets with growth in franchises, in large part due to the pandemic creating market conditions favorable to growth. The cost of real estate and the availability of human capital that has been displaced due to COVID has pushed many new buyers into the franchise category. With ghost kitchens, new take-out models and food trucks as the face of this restaurant revolution, the ever-evolving restaurant franchise industry is poised to face the new frontier of post-pandemic lifestyle.

For more information on how to grow your business during the pandemic, visit Franchise Marketing Systems website.

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