Choosing the Right Franchise

Healthy Franchises vs. Unhealthy Franchises

William Bike Ft. CollinsAmericans are eating healthier, going paleo or giving up red meat, choosing chia seed puddings over cupcakes. They’re also working out more, hitting the gym for grueling boot camps and intense strength training, and spending more of their free time on outdoor sports.

Or are they?

60% of North Americans told Nielsen they were eating more fresh foods and 59% said they were cutting down on sugar and fats. Nearly half claimed they are cutting back on processed foods. That might be rough for fast food franchises, but when Nielsen checked what consumers actually bought, they found that healthy food purchases were increasing–and so were indulgent foods.

American consumers are choosing fresh fruit and Greek yogurt for breakfast, but then they’re stopping off for a doughnut along the way to work, where they’ll have a kale salad… and a double bacon burger and a milkshake. In other words, we’re eating more healthy foods, and also eating more unhealthy foods. We’re not eating as much of the middle of the road foods like bread, cheese, and pasta.

Good Food calls it extreme eating and suggests that it’s partly a rebellious response to restrictive diet fads and partly the result of social media, where sharing extreme foods is rewarded by Likes and Shares, and ordinary balanced meals get ignored.

Krispy Kreme Doughnuts suffered in the Recession, lost ground with low-carb and gluten-free eating trends, and saw a number of their franchisees go bankrupt. But now they’re pushing to replace those franchisees and bring their brand back to its former glory.

Here are some of the strategies they’re trying:

  • Focusing on drinks. If customers come in for the coffee (or the Lotta Latte Chiller), they’ll grab a doughnut, too.
  • Working with smaller spaces and lower rents to make it easier to weather tough times.
  • Presenting doughnuts as part of a balanced life, as explained in the ad below.

donuts-are-bad-for-you-life-is-about-balance

As for exercise, Gallup polls have shown for a couple of decades that just about half of Americans get the three times a week exercise doctors say we should, and a third don’t exercise at all. They haven’t seen much change over the years.

People who buy memberships at a gym — many of which are franchise businesses — plan to go to the gym about 10 times a month, but The New York Times reports that they only actually go about once a month. What’s more, many keep paying for months after they stop going completely.

A gym is in a completely different position from a fast food place when it comes to America’s self-delusions about how healthy we are. Where a person on a strict diet may give up fast food or at least cut back, gym members who pay but don’t play actually can be good for the gym’s bottom line. If your fitness center members only attend once a week, you can have a lot more paying members than if they actually showed up three times a week. There’s just more space available.

Either way, your research on the market for a new franchise shouldn’t rely on trends and feelings. You might think that a doughnut shop would be a risk and a gym would be a sure thing, but both can be profitable with the right approach.

0
Pending Request