Original Or Franchised? Some Food For Thought

 

I use and encourage my valued connections, clients, and students to gather and use as much research in their favor as they can find. When people don't agree or prefer a different approach with me, they need to do some degree of research to come up with a response. They do so a percentage of the time. The purpose of real estate related research is to strengthen your case ahead of making you "right" all of the time. Personally, I think of it like hiring an attorney. We do not always hire an attorney to be "right". He or she is hired to win your case.

 

It is fascinating when one side presents favorable stats and trends to show why a property or opportunity should move forward, while another side has clear data to show why it should not. The current climate with sit-down restaurants provides a major example of different ways to look at the same situation. Many restaurants are struggling, and closings continue across the country. At the same time, many continue to hold their own and, in some cases, expand their presence.

 

As the below linked article demonstrates, you could make a case either way. Its focus is on New Orleans, which has a much lower presence of chain restaurants than most other metro areas. The featured expert in the article talks about how chains are doing better than the "local" operations, especially in that market. However, a real estate professional or investor with a different purpose could turn that around and point out the greater opportunity for chain restaurants to be "first in" with expanding to the area.

 

One aspect of the data is there is nothing to show for consumer preferences. In general, some consumers prefer a chain and to "know what they are getting", while others enjoy the unique local dishes and amenities they can't find near home. It is safe to say that many consumers look at the location, convenience, menu offerings, prices, and quality of service (in whatever order) to make their dining decisions ahead of whether it is a local or chain location.

 

My feeling continues to be that the demands of the audience should dictate. I call it the "Burger King Theory". It comes from years of noticing how many times you see a McDonald's only to see a Burger King in close proximity. King has probably saved millions of dollars on market research because McDonald's has already been placed to draw in the same target audience they serve. Hence, it could be a matter of what menu would best serve parts of the New Orleans area ahead of whether it is a chain or a local. Recent research shows there could be some good opportunities for those that know to take advantage of them. 

 

https://www.axios.com/local/new-orleans/2026/01/16/franchise-restaurants-grow-independents-decline