The idea of successfully running your own restaurant can be daunting, especially considering the number of regional and national chains out there. However, there’s no reason for worry, because the small size of your establishment puts it in a better competitive position than its larger counterparts. In fact, according to research conducted by Pentallect, Inc., the average independent restaurant will see its revenues rise by five percent in the next five years. Here are four catalysts driving such growth.
1. The burgeoning “buy local” movement. More and more consumers prefer to “buy local” to support nearby businesses and to be environmentally responsible. A large chain can claim to use locally sourced ingredients in its operations, but its credibility with consumers on this front is limited.
However, an independent restaurant faces no such challenges, especially when it comes to the foodservice industry’s largest customer base — millennials. These consumers have a strong preference for buying local, and for patronizing small establishments that can do the same in most or all instances.
2. Heightened consumer interest in “niche dining.” Consumers are no longer impressed by restaurants that lack a focus and try to be “all things to all people.” Rather, they favor establishments that zero in on a specific niche. An independent restaurant is in a perfect position to do just that, primarily because of its size.
Bear in mind that “niche” doesn’t necessarily mean a certain type of cuisine, such as burgers or Italian specialties — although it could. It can also be a particular concept, such as fast-casual vegetarian cuisine, or a given target market, for example, children.
3. Increased online exposure, including exposure via social media. Rating websites like yelp.com are putting the average independent restaurant on an equal playing field with larger contenders. So, too, are social media sites like Facebook and Instagram. How? By making it easy for consumers to find local restaurants and to research those with which they aren’t familiar, before deciding whether to eat there.
4. Growth of delivery and delivery services. Consumer demand for delivery — and the use of delivery services — is one of the most prevalent trends in the restaurant industry today. And by many estimates, the independent restaurant model is much more conducive to delivery than the chain or large multi-unit restaurant model.
For one thing, consumers have demonstrated, and are still demonstrating, a willingness to pay higher prices for local cuisine, along with a surcharge for delivery. They are less amenable to the idea of shelling out more money for “generic” food from a chain.
Additionally, convenience has long been a major draw for many chains, but delivery removes that advantage from the table — especially for fast-casual operators. After all, third-party services make it easy for any independent restaurant to offer delivery services.
Some consumers will always gravitate toward chains, and chains continue to see opportunities to increase their market share. However, the “buy local” movement and the growth of “niche dining,” social media, and delivery bode extremely well for independent restaurant operators. Now is a great time to jump on that bandwagon, using point of sale (POS) and other technology from Focus POS as a lynchpin. Learn how.