A proven franchise could provide the perfect route into the vibrant food and beverage sector
After a tough couple of years, hospitality is bouncing back. Franchisors are announcing ambitious expansion plans that will bring opportunities for those who want to invest in a slice of the food and beverage sector.
Headlines about lack of staff and food shortages don’t mean you should completely rule out starting a business in food and beverage – but you should research the sector very carefully.
The value of the franchise route
Starting with a franchise will likely give you a better chance of success than if you start up alone.
Peter Court, who operates the ActionCOACH business coaching franchise in Bournemouth, is seeing many local hospitality business owners struggling with recruiting staff and sourcing key supplies.
He says: “If you’re thinking of getting into the hospitality industry, I recommend considering franchises. You start your own business, but with the clout of a much larger brand.
“While we saw a couple of drinks temporarily off the menu at McDonald’s due to a lack of lorry drivers, the franchisor’s commitment to finding solutions for their franchise network means that franchisees haven’t been hugely affected compared to some independent restaurants.”
Problems recruiting and retaining staff are likely to mean staff costs will rise.
Around 76 per cent of respondents to a survey by hospitality sector consultant CGA said they had offered better pay as part of their retention strategies. Franchisees may be better equipped to tackle this than independent start-ups.
“As a franchisee, you’ll benefit from proven recruitment and training systems for staff, giving you the edge when it comes to finding and keeping staff,” Peter says.
“You’ll also have the franchise head office and other franchisees across the network to turn to when challenges arise.”
Sanjeev Sanghera, co-founder and managing director of Döner Shack, has tried both going it alone and franchising.
He says: “Having started out as an independent restaurant owner, I know you’re very much on your own, with no support, training or advice.
“With franchising, you’ve the ability to scale up quickly and efficiently and have the support from a network.”
Growth sectors: Competitive socialising
What would you rather do on a Friday night?
Trek to the pub with colleagues for a pie and a pint while listening to Tim from accounts bewailing his football team’s rubbish performance or spend a fun evening playing ping pong, electronic darts or even competing in an axe-throwing competition with workmates while enjoying a few drinks and some bar food?
It’s easy to see why the latter – called competitive socialising – is growing in popularity. And franchises that combine food and beverage offerings with competitive socialising are starting to appear.
In a 2019 report into competitive socialising, estate agent Savills and the Leisure Property Forum listed the business benefits.
They included increased dwell time, extended customer reach, income diversification – people are not just ‘here for the beer’ – and increased footfall as customers come for a group night out. It all adds up to increased food and beverage sales, boosting income and profits.
Opening a competitive socialising outlet using a successfully proven concept, such as a franchise, could reduce the risk.
Richard Beese, co-owner of the Boom Battle Bar franchise, says: “Our point of difference is one of having something fun, interesting and challenging for our customers to do alongside the traditional food and drink experience.
“Our customers spend more time, money and come back more often than traditional pubs and restaurants.
“The prospects for the sector are amazing, as the gaming proposition is a great leveller and appeals to all age groups and families.”
Boom Battle Bar has five sites open, 25 locations in the pipeline and in five years hopes to have over 150 UK outlets.
Technology to the fore
Expect to see more use of technology, so franchisors can deliver better services with fewer staff.
Brody Sweeney, founder and CEO of delivery-focused franchise Camile Thai Kitchen, says: “We’re planning to have customers receiving their food by air, initially within Ireland, and shortly after that in the UK.”
Camile Thai Kitchen has 12 franchisees and 35 outlets.
“A drone delivery costs about half that of a delivery driver, has no emissions and can fly in 90 per cent of weather conditions,” Brody adds.
“Drones could complete around 80 per cent of the deliveries currently made by traditional transport.
Londoners can expect the service in around two years.”
Food franchises are also turning to robots.
“We’re also trialling a version of a mechanical wok that cooks and dispenses food,” Brody says.
“It means we’ll be able to redeploy staff away from cook lines into other areas, such as operations, our hub office or our central production kitchen. Robotics is an absolute win-win in terms of efficiency.”
Meanwhile, in the US, fast food chain White Castle installed grilling and frying robots in 10 of its locations this year.
The robotic ‘Flippy Roar’ system can prepare an average of 360 baskets of fried food a day, leaving staff to concentrate on order fulfilment.
McDonald’s restaurants in the Chicago area are experimenting with an artificial intelligence-powered voice system that can process customer orders in drive-thrus. More franchises are likely to follow.
New tastes equal new franchise opportunities
Britons like a taste of something different – hence the rush by food and beverage franchisors to bring new concepts to the UK.
Bubble tea brand Gong Cha now has 11 sites here and has plans for expansion.
Bubble tea is not your traditional English cuppa. It’s a long drink, made from tea such as black, green, oolong, jasmine or Earl Grey, with or without milk, and with additions such as chewy tapioca balls in many flavours, sweet and salty milk foam, cheese foam, coconut, aloe or other toppings.
The global bubble tea market was valued at $2.4 billion in 2019 and is estimated to reach $4.3 billion by 2027. There are already several bubble tea franchises in the UK.
Justin Liew, general manager of Gong Cha England, says: “After opening our first store in Manchester in 2019, we were hit by the pandemic, but now we’re back to normal and looking for passionate individuals to open new stores in key areas throughout England.
“Franchisees receive ongoing training, marketing and business support, a standardised supply chain and an easily scalable franchise model.”
The average Briton eats 2,700 sausages in their lifetime, but now the traditional Lincolnshire or Cumberland are not enough.
Brits are getting a taste for bratwurst – and Extrawurst, which has over 30 food-to-go sites in Germany, is looking for UK franchisees.
Sam Shutt, CEO of Extrawurst UK, says: “The UK food-to-go market is expected to recover from the pandemic at a faster rate than the total eating out market, so there’s an opportunity for an innovative new offer.”
Sausages are the perfect food to eat on the go, whether as a breakfast snack or a lunchtime meal with a coffee, he adds.
The Extrawurst menu includes a choice of pork Bratwurst sausage in a bun, Frikadelle and Schnitzel options, plus the famous Currywurst, which is relatively unknown in the UK but has a huge fan base in Germany.
There is a choice of sauce toppings, sides and spices. The company will also be introducing a vegan Bratwurst to the UK market and the outlets will serve artisan roasted coffee.
The brand will launch with three shop format units in Birmingham, Nottingham and the West Midlands in Q4 2021, which will be operated by the Extrawurst team with a view to rolling the model out to franchisees in 2022. It’s aiming for hundreds of outlets across the UK in the next three years.
In keeping with the trend to focus on food to go, the model is available in several formats, including a counter service shop with a small seating/standing area that’s suitable for high street and shopping centre locations; a relocatable container, which can be positioned in retail and industrial parks, food markets and events; and a micro version, comprising a standardised bicycle, e-bike or tuk tuk that can be used for seasonal events and at pop-up venues.
Love Brownies, an award-winning chocolate brownie and café brand, has opened two new franchise stores in St Albans, Hertfordshire and Rochester, Kent.
Chantal Teal, Love Brownies’ owner and head baker, says: “The brand has been well received across the south east and we’re looking forward to further expansion across the country.”
The new shops and cafés offer Love Brownies signature products plus premium coffee and a breakfast and lunch menu.
As well as a shop franchise in a range of sizes, there is also a new mobile hatch offering housed in an Airstream trailer.
Suj Legha, Döner Shack
“I’m looking forward to owning a slice of the £2.8 billion UK kebab market”
Suj Legha is both CEO and a multi-unit franchisee with Döner Shack, the German food franchise, which has ambitious UK expansion plans.
Suj knows about food and franchising – he introduced Papa John’s to Scotland in 2001 and is a business mentor and coach with ActionCOACH.
And when he started coaching Döner Shack co-founder and managing director Sanjeev Sanghera, he knew he wanted to be involved with the brand.
“Having been in franchising for over 20 years, one of my biggest regrets is that I didn’t get involved in any of the big fast food franchise brands,” Suj says.
“I was determined not to lose out this time. I truly believe Döner Shack will be a major player in the industry.” Six months after being appointed as CEO, he invested in two Döner Shack restaurants in Manchester.
“The franchisee training included an A-Z of how to run a successful restaurant franchise,” Suj says.
“It was hard work, but covered everything from how to make a kebab to serving customers, stock ordering and how to minimise waste and deal with suppliers, as well as how to manage and lead a team.”
Suj intends to be the largest multi-unit franchisee in the UK, with over 20 restaurants by 2026.
“I’m looking forward to owning a slice of the £2.8 billion UK kebab market and becoming the number one kebab franchise in the world,” he says.
David Moore, Boom Battle Bar
“The games drive up food and drink revenues”
David Moore has two outdoor adventure golf courses, but says: “I was keen to get into the games hospitality business as it’s growing at present, so the Boom Battle Bar franchise seemed the ideal opportunity.”
He invested in a franchise because he felt Boom Battle Bar was better than anything he could deliver on his own.
“I liked the branding, the franchise managers and the web presence that comes with the franchise and this was the first business I saw that offered so many activities under one roof,” David says.
“You also get a lot of help from the franchisor with things like compliance, which having never operated a bar or food outlet before was very important to me.”
His Boom Battle Bar, in Norwich, opened in July 2020.
It offers axe throwing, electric darts, shuffleboard, crazier golf, beer pong, table tennis, skeeball (a traditional arcade game), table football, Connect Pour (Connect 4 that’s been turned into a drinking game) and Boom Battle Shots (based on the game Battleships).
“We were busy from day one,” David says. “It’s a perfect venue for mates’ nights out, corporate events and even date nights because the activities break the ice.”
He invested despite the lockdowns: “I believed in the business model and didn’t want to miss the opportunity.”
David reopened his business in May 2021.
“We’re as busy now as we were at the start and I expect to grow further, as Norwich is a financial hub and corporate events are increasing as people go back to offices,” he says.
“The games drive up food and drink revenues.” David advises: “If you’re interested in getting into games hospitality, move now because if not you’ll be left behind.”
Linda Whitney writes about franchising for the Daily Mail, What Franchise and many other publications