While working on the 2010 AllBusiness AllStar Franchise rankings, I noticed a growing trend: More franchisors are thinking creatively when it comes to finding real estate. Not only is it harder to get financing for a big location these days, but many franchisors are pursuing the unusual.
Marketing Daily reports on five restaurant chains that illustrate this trend. Sun Capital Partners, the private investment firm that owns Bruegger’s Bagels, Fazoli’s Restaurants, Friendly’s Ice Cream, Smokey Bones Bar & Fire Grill, and Timothy’s Coffees of the World Inc., is opening franchises in airport food courts, colleges, and hospitals.
The nontraditional locations attract three to five times more traffic than the more standard mall or strip mall locations. Sun Capital is bundling its brands, so that some locations could include more than one of these franchise concepts.
Concession locations such as these operate a little differently from traditional retail locations. Locating in an airport (or on some college campuses) may also involve government bidding.
Could nontraditional locations work for your franchise concept? It’s something worth looking at. This isn’t a decision to be made lightly, however. Chris Cheek, vice president of franchise development at Bruegger’s, says that nontraditional retail involves “a steep learning curve.” He notes that all five of [Sun Capital’s] franchise chains will have to adjust their operations to fit nontraditional location requirements, such as planning for a smaller space, developing a limited menu, and figuring out how to handle increased customer traffic.
If you can tackle these issues, however, now is a good time to be flexible when it comes to your concept. Nontraditional locations such as smaller stores, locations within other businesses, or carts and kiosks can be a great way to lower the cost of entry for franchisees — thus enabling your company to sell more franchises.
Rieva Lesonsky is CEO of GrowBiz Media, a content and consulting company that helps entrepreneurs start and grow their businesses. Follow Rieva on Twitter @Rieva. Visit SmallBizDaily.com to read more of Rieva’s insights on small business and to buy her newest book, Startup 101: Quick Tips for Starting a Business.