Are you planning to open your second outlet or do you have ambitions to manage a chain of restaurants? Put all the chances on your side before launching yourself by consulting the article below. We give you the keys to make your restaurant franchise adventure a success!
Restaurant chain: definition
The term chain restaurant can be used whenat least 2 restaurants offer the same cuisine and the same layout. Whether you run a restaurant specializing in kebabs, organic food, pizza, sushi or tacos,everything is standardized so that the customer can't tell the difference from one establishment to another. The decoration, the furniture, the uniforms, nothing is left to chance.
In short, the restaurant chain groups togetherall the units operated under a single brand. The Big Fernand chain is a perfect example! Your operating model can be based on a branch or franchise model, which is the subject of this article.
👉 To go further: the ultimate guide: opening your fast food franchise
Protect your intellectual property
The protection of your intellectual property is the starting point of any restaurant chain creation project. Theregistration of your trademark and logo are, in fact, essential to the creation of a franchise network. As a franchisor, these are your most valuable assets, which you can sell for royalties.
Now that the basics are set, let's get to the heart of the matter!
👉 To go further: How to register a trademark?
Develop a detailed business plan
To ensure the success of your restaurant chain, you must address all management issues in a detailed business plan.
Here are some of the questions you need to answer:
- How many franchises do you want in your network in the short, medium and long term?
- Who are your competitors?
- How much are the entrance fees and royalties?
- In which geographical areas will they be located? What are their catchment areas?
- What is the staff organization?
- How to promote the channel?
- How is the control of the value chain (supply, inventory management, quality control, customer service) ensured?
- What type of training is required and recommended in the restaurant industry?
A large part of your business plan should be devoted to the financial aspect of your project. The goal is to prove to the banks and to your future franchisees that your restaurant chain is economically viable.
Don't be tempted to underestimate the costs (entry fees, infrastructure, royalties, etc.) to attract investors. It is better to attract few partners than many entrepreneurs with unreliable projects.
Include quantitative analyses in your business plan. Estimate your expected growth rate, cash flow and time to return on investment. These indicators will have a considerable impact on the decision of potential franchisees.
Establish clear guidelines in an operations manual
The proper functioning of a franchise network relies, in large part, on the consistency between each establishment. To achieve this, there is only one recommendation: develop a comprehensive guide for franchisees. The purpose of this document is to help franchisees replicate your concept and all its features. Restaurant owners should be able to refer to it to set up and manage their establishment according to your brand guidelines.
Here is a non-exhaustive list of criteria to be determined:
- your restaurant's concept, vision, mission and values,
- interior design and furniture,
- uniform and equipment requirements,
- health and safety regulations,
- procedures related to the service,
- Supplier and procurement information,
- regulations related to food preparation, storage and service,
- food production requirements such as recipes, portion sizes and presentation guidelines,
- opening and closing procedures,
- pricing information.
Each restaurant will have the same standards, which will ensure consistency across all outlets and consistent quality over time.
Draft a solid franchise agreement
That's it, you have a solid business plan and operations manual! Now you can focus on your franchise agreement. This contract protects both the franchisee and the franchisor and specifies the obligations and rights of each.
This agreement must include at least the following:
- the identity of the franchisee and the franchisor,
- the duration of the collaboration with the franchise as well as the renewal options,
- your franchise model: operations, locations, marketing strategy, etc,
- the amount of license fees, royalties, and any additional fees,
- a Franchise Disclosure Document (FDD) describing the details of your business, its legal history, organizational structure, etc,
- your operations manual,
- a list of the activities and support resources you will provide to your franchisees throughout the term of the agreement,
- the legal responsibilities and tax regulations of both parties,
- the sales rules of the franchise,
- procedures to be followed in the event of breach or termination of the contract.
Take care of your marketing and communication strategy
Now is the time to market your project and convince independent entrepreneurs to join your restaurant chain. To do so, you will have to create impactful marketing tools. With flyers, brochures and advertising campaigns, you will have to persuade them of the excellent business opportunity that your restaurant chain represents. Don't neglect your presence on social networks and your participation in trade shows and networking events. Emphasize your strengths, your brand story and your growth projections.
Your communication strategy is also extremely important. You will quickly realize this. A good brand image is a selling point in itself. If it is particularly attractive and if future franchisees are convinced of its potential to attract customers, the desire to work for the brand will follow, provided you have interesting budget estimates.
Finally, don't neglect your restaurant chain's communication to your end customers. Today, online visibility is crucial to attract and retain customers. Devote a dedicated budget to increase your notoriety and develop your activity on social networks like Facebook at local and national level.
Consider your future franchisees as partners
One of the mistakes you wouldn't want to make as a restaurant chain manager is to simply collect the franchisees' royalty without offering them value in return. Franchise agreements are not forever, and if franchisees don't feel valued, supported or simply considered enough, they are free to not renew the agreement.
It is in your best interest to offer them some additional benefits that will ultimately benefit you as well. This can take the form of training sessions, management advice or refresher courses. By treating them as real business partners, you will all win!
Did you think that the operations manual would exempt you from providing training?
Think again!
Ideally, your training program should include:
- Initial training during which franchisees learn everything there is to know about the company in which they have invested: history, mission, vision, values, culture, daily operations, performance indicators, opening and closing procedures, safety and hygiene, etc.
- On-site training to familiarize franchisees with the day-to-day operations of the restaurant. Training needs may vary from franchisee to franchisee depending on their previous skills and experience.
- Ongoing training that will keep franchisees up to date on the latest information and products in the network and prevent common standards from disappearing over time.
Build a competent management team
The big difference between managing one restaurant and managing a chain of restaurants simultaneously is that you can't be physically present everywhere at once.
To do this, surround yourself with competent people you can trust:
- A lawyer or a legal expert specialized in franchising who helps you draft your business plan and your franchise agreement. He or she will also register your trademark and draft various legal documents such as confidentiality agreements, employment contracts, etc.
- A consultant who conducts market research to determine how to differentiate you from your competitors and sets up your operations manual, quality control system and training program.
- An executive chef who gives instructions to the chef of each restaurant.
- A management controller who deals with deliveries and the management of suppliers and stocks.
- An accountant who takes care of all the financial aspects (balance sheet, income statement, tax payments, etc.). The accountant also prepares financial models to determine the royalties and investment capital for each unit.
- Marketing and sales professionals who support your business strategy.
- A communication expert to take care of your image and make sure your brand is known to everyone, especially on social networks!
- A training specialist to help you design and develop your franchisee training program to give them the knowledge and tools they need to succeed.
- Other professions you may need: a secretary, an operational expert, a real estate expert, an HR manager, etc.
Take an interest in digital to drive your restaurant chain effectively
You could almost consider technology as a member of your team as it will be so useful to you.
As a restaurant chain manager, you will be constantly looking for ways to save time, efficiency and money.
That's when you should turn to digital solutions, especially for two reasons.
Increase the productivity and profitability of each restaurant
It's no secret that the largest restaurant chains have integrated digital technology into all stages of their business. It saves seconds at every stage: order taking, kitchen preparation, and cashiering.
Alain Duquesne, director of the Ankka franchise, has always believed in the contribution of digital technology.
By connecting his cash register to his order terminals and his production screens in the kitchen, he has streamlined the flow of his customers and the organization of his restaurant:
"Payments are made online or directly at the kiosks, which has allowed me to allocate staff differently. With the production screens, I can offer more products all day with dedicated preparation."
To manage all the points of sale
Unless you teleport to your network's locations or spend a lot of time on the road, you'll find it difficult to effectively manage all your outlets without the help of dedicated management software.
Innovorder has developed a solution designed for franchise managers who want to keep control from a distance and lose as little time as possible.
"Thanks to Innovorder, the information from my restaurants is transmitted in real time to the entire network, which allows me to act immediately, which is a real plus. "Alain Duquesne, manager of the Ankka franchise
By equipping your restaurants with the same management ecosystem, ensure concrete performance for your franchisees and remotely manage your entire restaurant chain at the same time. For example, Innovorder offers a multi-brand management feature. A luxury when you know that consistency is a key success factor for a franchise!
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You want to open or develop a chain of restaurants? Trust digital technology to manage your restaurants easily and efficiently!
Make an appointment with an Innovorder expert and discover how the Innovorder digital ecosystem meets your needs!
