The majority of restaurant leaders are exhilarated at the potential for growth. Visions of multiple cities, beautiful footprints operating at maximum potential, and the idea of brand signage shining bright is enough to get any restaurateur pumped up. But, what if we told you that rapid growth could be dangerous?
Rapid growth, while fun to think about, comes with multiple issues that could sink a brand if leadership isn’t prepared. It’s easy to think that because operations are strong enough to scale, they’ll scale successfully. Yet, time and again, we’ve seen brands with seemingly sound processes and impressive P&Ls grow, shrink and fizzle out. Why?
The simple answer is Infrastructure.
Successful scale resides in the replication of the three P’s of business; People, Processes, and Product. And while all of these are most likely present, they become stretched and strained as the footprint expands. More often than not, the product and processes are scalable, but the People are not. Specifically, the people put in place to SUPPORT the system.
Oftentimes, we see brands that scale do so without the people to support the growing system. Critical positions like marketing, training, operations, and more, go overlooked or put off for too long. We’ve seen brands scale to 10+ units with minimal marketing support but don’t see the issue brewing, especially in franchised systems.
Franchisees demand support from corporate. No matter how low you’ve set the marketing fund percentage, the demands do not change. Franchisees require corporate to provide the tools and materials necessary for growth. They look for market-wide marketing and advertising to reassure their buy-in and investment. When it’s not present, or the support is minimal, unrest takes hold.
Another area where rapid scale goes wrong is directly tied to the markets in which the brand enters. Many times we see growth driven by opportunity and not by strategy. This plays out when there’s an opportunity to sell franchises in a state that’s on the other side of the country. While the money seems great, servicing this new market is nearly impossible without hiring a regional authority to train, guide, support, and police the new area. Do this too often, and brands will see a sinking P&L as new hires are tackled as an urgent necessity. It removes the tactical, surgical approach necessary for smart, successful restaurant growth.
The path to successful restaurant scale starts with identifying the right fit in key support positions before growth takes hold. With that talent identified, knowing what markets are primed for your brand’s success is an absolute must. Shameless plug: Borne does just that and we’d love to help! With our innovative, machine-learning fueled restaurant market planning software, you can intelligently scale your brand with confidence.
