Broadly speaking,
restaurants can be segmented into a number of categories:
1- Chain or independent (indy) and franchise
restaurants. McDonald's, Union Square Cafe, or KFC
2- Quick service (QSR), sandwich. Burger,
chicken, and so on; convenience store, noodle, pizza
3- Fast casual. Panera Bread, Atlanta Bread
Company, Au Bon Pain, and so on
4- Family. Bob Evans, Perkins, Friendly's, Steak
'n Shake, Waffle House
5- Casual. Applebee's, Hard Rock Caf´e, Chili's,
TGI Friday's
6- Fine dining. Charlie Trotter's, Morton's The
Steakhouse, Flemming's, The Palm, Four Seasons
7- Other. Steakhouses, seafood, ethnic, dinner
houses, celebrity, and so on. Of course, some restaurants fall into more than
one category. For example, an Italian restaurant could be casual and ethnic.
Leading restaurant concepts in terms of sales have been tracked for years by
the magazine Restaurants and
Institutions. hamburger restaurant Billings Montana
CHAIN OR INDEPENDENT
The impression that a
few huge quick-service chains completely dominate the restaurant business is
misleading. Chain restaurants have some advantages and some disadvantages over
independent restaurants. The advantages include:
1- Recognition in the marketplace
2- Greater advertising clout
3- Sophisticated systems development
4- Discounted purchasing
When franchising,
various kinds of assistance are available. Independent restaurants are
relatively easy to open. All you need is a few thousand dollars, a knowledge of
restaurant operations, and a strong desire to succeed.
The advantage
for independent restaurateurs is that they can ''do their own thing'' in terms
of concept development, menus, decor, and so on. Unless our habits and taste
change drastically, there is plenty of room for independent restaurants in
certain locations. Restaurants come and go. Some independent restaurants will
grow into small chains, and larger companies will buy out small chains.
Once small chains
display growth and popularity, they are likely to be bought out by a larger
company or will be able to acquire financing for expansion. A temptation for
the beginning restaurateur is to observe large restaurants in big cities and to
believe that their success can be duplicated in secondary cities. Reading the
restaurant reviews in New York City, Las Vegas, Los Angeles, Chicago,
Washington, D.C., or San Francisco may give the impression that unusual
restaurants can be replicated in Des Moines, Kansas City, or Main Town, USA.
Because of demographics, these high-style or ethnic restaurants will not click
in small cities and towns.
5- Will go for training from the bottom up and
cover all areas of the restaurant's operation Franchising involves the least
financial risk in that the restaurant format, including building design, menu,
and marketing plans, already have been tested in the marketplace. Franchise
restaurants are less likely to go belly up than independent restaurants. The
reason is that the concept is proven and the operating procedures are established
with all (or most) of the kinks worked out. Training is provided, and marketing
and management support are available. The increased likelihood of success does
not come cheap, however.
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