Franchised vs. Privately Owned Restaurants (Pros & Cons)

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When it comes to restaurant ownership, there’s one big decision you’ve got to make before deciding anything else: Do I want to own a franchised restaurant or do I want to start out on my own my own private enterprise?

Maybe you’ve already got your heart set on owning your own franchise, joint or maybe you’ve always loved the idea of branching off and starting your own company — in either case though, there are still some things you should know about both. Following are the pros and cons of owning a franchised restaurant versus one that is privately owned.

Franchise Pros

Depending on the franchise that you’re thinking about opening, longevity can be more predictable. This is partly because making a profit can be more consistent if you own a franchised restaurant, especially if you’re opening in an ideal location. Of course, making a profit isn’t everything… but you need a steady inflow of profit in order to keep your business afloat long-term!

Franchise Cons

The biggest downside of owning a franchise restaurant is that in small, college-based cities like Columbia, Mo., locally owned businesses are sometimes more revered due to the recent trend of local shopping and eating. With that trend in mind, franchised restaurants face a new set of challenges and need to ask themselves a new set of questions. Namely: What can I do to set my franchised restaurant apart from the rest and make it feel uniquely local? You may want to consider altering some aspects of your franchised restaurant (the aspects that you can change) in order to appeal to the local market; and you’ll definitely want to make sure that every restaurant-customer interaction is absolutely flawless since you know you’re already at a disadvantage. Suffice it to say, a franchised restaurant owner really needs to be proud of their franchise in order to execute with that kind of precision.

Privately Owned Pros

One of the biggest benefits to owning your own private restaurant is that you have way more freedom. For instance, owning your own private restaurant confers the ability to be your own boss as well as to make decisions you feel your target/local market would both benefit your community and business.

Privately Owned Cons

When it comes to downsides, the only real pertinent one would be money — not having the financial backing if things turned south could end up bankrupting you and leaving you dry. Besides that, there is much downside to owning a private restaurant, provided you like what you’re doing and the community you’re operating in.

As always, it’s absolutely critical to weigh out your options and plan everything out before doing anything else in the restaurant industry. At the end of the day, it comes down to a question: Do you have all your ducks in a row to open your own business or would you rather start with a franchised business to get in your experience? In most cases, if you have the capital and experience, you may be at a real advantage. After that, you’ll just need to do research on the local market and competition before taking any real concrete steps.

Sammy Jo is a writer for Willie’s, a local sports bar and grill in Columbia, Mo. They’re known for their tasty wings and great drinks.