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As the restaurant industry attempts growth during the recovery from the economic downturn industry analysts say franchising is a major avenue restaurant chains are pursuing.
clearpxlA new report by Technomic and Restaurant Finance Monitor finds that as a result of the recession franchisors began commonly offering incentives such as credit support and fee reductions to lure investors and those practices have continued as traditional sources of credit are still not easy to come by for many potential franchisees.
“Franchising continues to be a way for chains to grow unit counts with less capital expenditure, allowing the franchisor to focus on system-wide branding initiatives while franchisees deal with operations at the unit level. It is an attractive scenario for many entrepreneurs as well. They can take advantage of the brand strength and resources of these national brands while reducing their own start-up and operating costs.”