The success of a fast food franchise on a local level is heavily determined by the viability of a brand’s niche in the area. A viable niche that has remained unfilled usually bodes well for a franchise
Fast food franchises are an excellent business opportunity for many people already familiar with the restaurant industry. Provided they’re located in the appropriate location and have a large enough of a target audience, they could be a lucrative long-term money maker and have plenty of room for growth in an expanding community.
Niche selection lies at the core of fast food franchise opportunities. To succeed, a fast food franchise must remain committed to the niche its brand has carved for itself. Whether you can feasibly enter the restaurant business in your community, what franchise brand you would select, and which location you would choose to start your new restaurant are all influenced by whether a specific niche in the local community has yet to be filled.
The Challenges of Niche Selection
When it comes to dining, no size fits all. Trying to cater and serve a broad array of customers would result in poor service quality and satisfy fewer customers in the long run. After all, why would anyone have something mediocre in one place where they could get it better for the same price in another? Fortunately, franchisees rarely have to deal with the temptation to expand their product offerings; relying on a pre-existing brand allows them to hone on the one niche they’ve already found.
Part of what makes niche selection so important is identifying the golden mean between being specific and still appealing to a large enough local audience to be viable. Although getting a franchise for an established brand eases this dilemma, it still requires careful judgment to determine its viability in a new community.
A franchise-based enterprise has the main advantage of already have a pre-existing brand name in your enterprise wheelhouse. By having a brand name behind a business, the enterprise narrows its franchise down to the people and audience they serve. Rather than having to worry about carving your niche, you only need to select the brand whose niche is well represented in your area.
Sizing up Your Neighborhood
Your area’s current demographics would also influence the type of restaurant franchise brand you choose (and, thus, the initial investment you would make). The most profitable market segment would determine the viability of some franchise brands over others.
Selecting the right niche involves finding out which business opportunities have yet been to be filled in a specific part of the neighborhood and looking for an ideal location that caters sufficiently to the desired target market.
Location and Products
Despite fast food, in general, having a broad appeal across demographics, specificity is how the brands distinguish themselves from one another. Some brands, for instance, focus on fast-casual sit-down dining with products based on dishes from a geographic locale. Others focus on desserts and sweets.
In some places, market saturation may already discourage some types of fast food over others. Your business would have immense difficulty in succeeding if you build a burger restaurant in a neighborhood already saturated with burger joints. Meanwhile, if you open a cookie franchise in a mall where baked goods and desserts are still underrepresented, you might find a lot of immediate success.
Location and niches are often intertwined; a specific location may be more feasible for one type of fast food franchise simply because it’s located further away from its competitors and much closer to its market.