You've probably heard more than once that franchise...
Food franchises account for a lot of franchise brands in Canada, so it's only natural to explore franchises in this sector when you're searching for the right business. In fact, it may seem like these opportunities are a slam dunk because they are so commonly associated with franchises. The food sector may be the right fit for you, but here's what to consider before you decide on your brand.
There's a lot of variety
Restaurants come in a lot of different formats, including full service, delivery, food court, catering, food truck, fast food, quick service and counter service. Generally speaking, the full service is the most expensive but often the most lucrative as well. All of these formats have different staffing needs and time commitments, so you'll want to consider your cash flow and your lifestyle. If, for example, you plan to work at your business but don't like getting up early, a counter franchise that does the most business during breakfast hours won't be a good fit. Look for a brand that fits with how you plan to live and what you are willing and able to spend and account for.
Controlling food costs is crucial
When compared to the retail sector, a significant and specific challenge the food service industry faces is food cost, which isn't as fixed as costs like labor. Wasted food can eat into your profits quickly, so controlling it will be crucial for your franchise's success. Many times, owners don't consider tracking waste or how a portion increase will cause their food expenses to inflate, and this can have some disastrous results.
As you're considering food franchises, look at the cost of the food itself and how you can keep that expense under control. If your franchise uses expensive ingredients or ones that spoil easily, take a look at how the brand is addressing those issues via technology, infrastructure and bulk pricing.
The Canadian food franchise industry is a longstanding sector, and it has led many franchisees to success. Before you flip your first burger or make your first shake, take the time to delve into the different brands available and get familiar with the challenges this industry can pose to a business owner. The more prepared you are going in, the more likely it is that you will find the right fit.