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In today’s fast-paced world, quick-service restaurants (QSRs) can be a popular choice for busy individuals to grab a quality meal on the go. In an industry report published in February 2023, Zippia researchers found more than 84 million American adults consume QSR food on a given day.
The same report calls fast food restaurants a “giant” in the U.S., for example, Americans spent roughly 10.3% of their disposable income on fast food in 2021, making them a potentially lucrative business opportunity for entrepreneurs. Let’s delve into the concept of a quick-service restaurant franchise to assess its viability as an investment opportunity.
QSR Franchises vs. Fast-Casual Franchises: Definitions & Differences
A restaurant franchise is a type of business model where an individual or group is awarded the development rights by a franchisor to build and operate a restaurant using their established brand name and business systems. Typically, franchisees pay an initial franchise fee and ongoing royalties each month to the franchisor in exchange for access to their brand’s operational systems, trademarks, technology stack, products, and services. In return, the franchisor provides support in areas such as training, marketing, and operations. QSR franchises, also called “fast food franchises” or “limited service” restaurants follow the above franchise model.
Fast food and QSR franchises, according to Law Insider, may offer a limited menu, focus on speed and convenience and include restaurants such as Subway and Burger King. Fast-casual franchises, on the other hand, according to definitions by Investopedia, may provide a higher quality dining experience with a more extensive menu and a focus on fresh ingredients and customization.
The quick-service restaurant concept combines what may be viewed as the best of both worlds. Quick-service restaurants provide a quick and efficient dining experience, while also offering a wider menu and higher-quality ingredients.
Penn Station East Coast Subs, for example, is a QSR franchise that offers a variety of hot and cold sub sandwiches, fresh-cut fries, salads, wraps, fresh-squeezed lemonade, and fresh-baked chocolate chunk cookies, all made with premium, fresh ingredients. Penn Station East Coast Subs combines quick-service efficiency with fast-casual quality, offering premium food and speedy service in a relaxed environment.
QSR Industry Outlook & Growth Forecast
A CNBC report published in July 2022 titled, “Restaurants are short-staffed, and that’s taking a big toll on customers and workers alike,” r stated restaurants were down about 6% of their workforce. Potential solutions include increasing wages and benefits, offering flexible scheduling, and implementing technologies (like online ordering and self-service kiosks) to reduce staffing needs.
Despite challenges such as the COVID-19 pandemic and restaurant labor shortage, the QSR industry is expected to continue to grow in the coming years based on several reports. According to a report by ResearchAndMarkets.com titled “Fast Food and Quick Service Restaurant Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2022-2027” and published in February of 2022, the global QSR market is projected to reach $308 billion by 2027, with a compound annual growth rate (CAGR) of 4.9% from 2022 to 2027.
Some experts say with this anticipated growth, there could be opportunities for entrepreneurs to invest in QSR franchises. Whether now is a good time to invest depends on factors such as personal finances, franchise selection, location, market trends, and the economic climate. It’s important for potential franchisees to do their research and consult with professionals before making any investment decisions.
An article in QSR Magazine from April 2022 titled “Why Now is the Time to Invest in a Fast-Food Franchise” discussed the benefits of investing in a QSR as a more pandemic-proof business model. The article makes the argument that QSRs are uniquely pandemic-proof because their model can be easily adapted during varying economic and health crises. The article goes on to say, “While full-service dining concepts were flailing to stay alive during the crisis, quick-serves were uniquely positioned and persevered. The quick-service restaurant franchise model easily pivoted to adapt to customer needs.”
Investing in QSR Franchises: Why Now
Recent industry reports show the QSR industry is expected to continue growing – analysts project about 2.2% annual growth, approaching roughly 204,000 total QSR outlets.
Penn Station East Coast Subs is uniquely positioned to grow along with the industry, as we continue to expand our brand across the U.S. We offer development territories for qualified multi-unit investors. To get started with Penn Station, prospective franchisees need to meet the minimum financial requirements of $500,000 in net worth and a minimum liquidity of $300,000.
Each franchise group must recruit a qualified managing owner (or “operating partner”) responsible for daily operations. The managing owner also attends the required four-week training in Cincinnati.
Request info today to be a part of a dedicated team and growing franchise with Penn Station East Coast Subs.
The offer of a franchise can only be made through the delivery of a Franchise Disclosure Document. Certain jurisdictions require registration prior to the offer or sale of a franchise. We only offer franchises in jurisdictions where we are registered or are exempt from registration. Penn Station, Inc. 1226 US Highway 50, Milford, OH 45150. Penn-Station.com
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