Restaurant Franchises under 20K and eating out is big business in the US. We love our world’s food, from traditional American, Mexican, and Chinese to European. American households, on average, spend about $3000 a year on eating out.
And while that number sounds high, it all adds up: $10 for your daily lunch on a weekday, $3 for an afternoon coffee, and $20 for dinner with friends once or twice a week. Even take-out and delivery food counts. If you add it all up, we spend a lot of money on restaurant food.
Restaurant Franchises Under 20K
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Think about Restaurant Franchises under 20K: if you spend $50 a week on food and drink from restaurants, you’re paying $2.5K a year to eat out, which equates to nearly 50% of the average American’s annual food budget.
The restaurant industry makes up about 10% of the entire US workforce. Nearly 50% of adults have worked in the restaurant industry at some point in their career, while a third of all American workers have had their initial work experience in a restaurant.
In general, restaurants increase their fees by up to 300%, which includes procurement and preparation, service, and convenience. According to the National Restaurant Association, the Restaurant Franchises under 20K bring about $800 billion to the US economy every year, accounting for 4% of GDP. Like we said, eating out is big business.
Franchising
Restaurant Franchises under 20K offer a unique opportunity to people hoping to leave the rat race and go into business for themselves. When you invest in a franchise business, you inherit the reputation of an established partner that is hard-earned.
This gives you greater visibility to consumers who already know and trust the brand because you provide the same quality, service, and experience as your parent company.
One of the most profitable elements of any restaurant franchise partnership is the world-class training that accompanies the investment. Your parent company will ensure that you develop the expert skills needed to deliver their exclusive menu and service consistently and with the care and love of their first restaurant.
In addition to training support, most restaurant franchise holding companies offer business and HR support packages to help ensure that you comply with complex industry and tax regulations.
Your restaurant franchise partner gives you access to an established supply chain, ensuring you receive the best quality ingredients at the most competitive prices. After all, the high-quality ingredients make for a great meal.
Taking on a restaurant franchise brings with it the benefits of instantly recognizable branding. This gives your new business instant curb appeal. People know what they’re getting with a brand, and when you ask your customers for their hard-earned money, quality counts every time.
Independent companies that started without the support of an established partner struggled from the start. Their first three years of trading are often very precarious, as these early years are full of financial instability.
All businesses need to recoup their initial investment before they actually turn to profit, and – for independent companies – that can be a long time coming.
Restaurant Franchises under 20K, however, tend to get their investment back more quickly than independents because they have instant traction and a ready-made reputation. Very few indies made a profit until Year 4, by which time it was often too late, and the business went out of business.
Restaurant Franchises under 20K offer a business opportunity for those who are just starting out with a restaurant chain that customers know and trust. Of course, it depends on the size of your initial investment, but many franchises change their profits within the first year.
Facts About Restaurant Franchises
There are currently more than 1 million restaurant locations in the United States, and more than 90% of them employ fewer than fifty people.
Restaurant Franchises under 20K cater to all tastes, from fast-food chains to formal sit-down service and fine dining. Regardless of which sector of the market you are in, the restaurant sector has experienced healthy growth over the last thirty years.
The restaurant sector is a major contributor to the US economy: sales in the industry have doubled since the turn of the millennium. This makes restaurant franchises a very fertile driver of economic growth in the US.
Prior to the pandemic, American restaurants had become an important part of everyday life we ate out more often and spent more money. The impact of the Pandemic will lessen over the next few years, so it’s a good time to think about investing in a sector that the American public values highly and would be keen to return to once things are settled.
Of course, the pandemic has had a temporary impact on the on-site dining experience; but the delivery and takeout sector is booming.
Businesses that have expanded their digital presence are restaurants that thrived during the stay-at-home period. And Restaurant Franchises under 20K are ideally placed to grow their digital presence because they have the scale to adapt to market challenges.
Franchise businesses benefit significantly from their parent company’s digital and marketing budgets by providing websites, marketing campaigns, and special offers that attract customers. The businesses that have the scale to adapt are the ones that thrive in these difficult times.
Franchising Vs. Independent
Banks and loan sharks tend to favor Restaurant Franchises under 20K in terms of initial funding. The franchise is built on proven metrics, the business model has a healthy track record of growth, profit, and sustainability.
Also, restaurant franchises have better access to the market and a strong financial model that helps sustain them when times are tough.
On the other hand, independent companies tend to struggle to win affordable interest rates for initial collateral due to unproven business models.
When you take on a restaurant franchise, you inherit your franchise’s reputation, business model, and parent market position. Restaurant Franchises under 20K often have a much healthier start than independent businesses because they have an immediate appeal and a customer base that already recognizes and trusts the brand.
Restaurant Franchises
Explore our incredible selection of Restaurant Franchises under 20K, and feed your fellow citizens with delights that they will visit again, again, and again.
Franchise Industry
The cornerstone of the entire franchise industry, food franchises account for about 30% of the total franchise establishments in the US, and nearly 60% of direct employment by franchisees.
These figures don’t even include food-related franchises categorized as retail, not fast food or full-service restaurants.
Major food franchise segments include
1. Bread Franchise
These Restaurant Franchises under 20K focus on a specific product area for their business, e.g. bread, muffins, bagels, croissants, pastries, donuts, and other sweet treats. A number of franchises in this area have menus that feature other items such as sandwiches, soups, etc. to stabilize revenue.
2. Coffee Franchise
The coffee franchise industry is well developed and competitive. And no wonder why. Coffee is second only to water in beverage popularity in the US, and consumption continues to increase. Many coffee franchises have other sources of income including baked goods or sandwiches.
3. Fast Food Franchise
With an estimated 25% of total U.S. franchise establishments. Across all industries, fast food is the most common segment of the Restaurant Franchise under 20K. Food production in fast-food restaurants, also known as fast-food restaurants (QSR), is focused on direct consumption. Fast food is usually taken out or delivered. However, some fast-food franchises offer limited seating.
Coffee Suppliers for Small Businesses Choosing the Right One
4. Full-Service Franchise
Full-service franchise restaurants range from casual family-style restaurants to high-end restaurants. Meals from full-service food franchises are usually eaten on the premises, although take-out or delivery service can be provided.
5. Frozen Ice Cream & Yogurt Franchise
The demand for frozen desserts is more evenly distributed throughout the year than it was a few decades ago. Customization has become a feature of many ice cream franchises as they take lessons from the resurgence of the frozen yogurt franchise segment.
6. Juice and Smoothie Franchise
Franchises in this segment have seen a boost from the general public’s shift to healthier food choices. Furthermore, regulations such as banning soda machines from schools have led franchises, such as Jamba Juice, to create vending machines for their wares.
7. Pizza Franchise
Fast and convenient, pizza is a niche food franchise that people can rely on. Because of that dependence, the pizza industry’s growth shows no signs of slowing down. And because delivery has come to the fore as a necessary component of business, not profit pizza franchises have shown the way.
8. Retail Food Franchise
Over the past few years, the convenience store industry has challenged other segments of the food franchise industry by increasing its food offerings, particularly the fast-food segment. Additional retail food franchises include food delivery, liquor store, and catering businesses.
9. Vending Machine Franchise
While it is true that many vending machine companies are business opportunities, there are several Restaurant Franchises under 20K options.
The vending machine food franchise segment is a bit of a general grouping with machine-featured offerings that go beyond traditional snacks and sodas to anything from cupcakes to smoothies.
Categories of Restaurant Franchises under 20K
Something to note is that franchises can crossover between given segments. Also, there are several sub-categories within the main category.
1. Firehouse Subs
The amount you need to invest in a Firehouse Subs restaurant can vary greatly depending on many factors, but at the lowest scale, around $95,000.
However, according to the Firehouse Subs franchise page, you need a minimum of $80,000 to invest (plus a 650+ credit score), which means it’s not completely off the mark.
Subs Restaurant Franchises under 20K are looking to invest in new franchises across the country from New York to Florida and California.
- 500 rating franchise: 39
- CEO: Don Fox
- Business headquarters: Jacksonville, Fla.
- Franchise since: 1995
- Initial investment: $94,783 to $1,090,366
- Initial franchise fee: $20,000
- 2016 new units: 80 units (8.0 percent)
- Training: 336 hours on the job, 35 hours in class
- Marketing support: Co-advertising, ad templates, national media, regional ads, social media, SEO, website development, email marketing, loyalty programs/apps
2. Baskin-Robbins
It’s still winter, so you may not be ready to think about ice cream yet, but you should. The Baskin-Robbins Restaurant Franchises under 20K has shown a ton of international growth since 2008. In the last decade, Baskin-Robbins has added 2,151 international franchises, representing a growth of 67.4 percent.
The ice cream franchise retails for a minimum price of $93,550. However, given that its sister company, Dunkin’ Donuts, typically sells for between $229,000 and $1.7 million, it could definitely be worse.
- 500 rating franchise: 41
- CEO: Nigel Travis
- Business headquarters: Canton, Mass.
- Franchise since: 1948
- Initial investment: $93,550 to $401,800
- Initial franchise fee: $25,000
- New units in 2017: 164 units (2.1 percent)
- Training: 2.5 weeks on the job, 2.5 weeks in class
- Marketing support: Co-advertising, ad templates, national media, regional ads, social media, SEO, website development, email marketing, loyalty programs/apps
3. Chester’s
Chester’s chicken restaurant has been around since 1952 but only started Restaurant Franchises under 20K in 2004. It makes sense, then, that the company has experienced rapid growth in the last decade, from 82 locations in 2008 to 1,156 in 2017.
One reason is the company’s low initial investment, $12,000, and an even lower franchise fee of $3,500.
- 500 rating franchise: 153
- CEO: Ted W. Giles
- Business headquarters: Birmingham, Ala.
- Franchise since: 2004
- Initial investment: $12,000 to $296,600
- Initial franchise fee: $3,500
- New units in 2017: 40 units (3.6 percent)
- Training: 30 hours on the job, 3 hours in class
4. Checkers and Rally’s
The number of Checkers and Rally restaurants has gone up and down over the past decade, but in 2017, there was a 10-year high of 851 locations 284 owned by the company, and 567 US Restaurant Franchises under 20K.
Checkers and Rally are still looking to add locations along the east coast, midwest and southwest regions, and you can view a map of the market here. The current initial investment is $96,414.
- 500 rating franchise: 140
- CEO: Enrique Silva
- Business headquarters: Tampa, Fla.
- Franchise since: 1989
- Initial investment: $96,414 to $1,501,265
- Initial franchise fee: $30,000
- New units in 2017: 18 units (2.2 percent)
- Training: 160 to 220 hours on the job, 32 to 40 hours in the classroom
- Marketing support: Co-advertising, ad templates, national media, regional ads, social media
5. Champs Chicken
Like Chester’s, Champs Chicken is a cheap chicken restaurant. You can potentially invest in Champs Chicken for as little as $9,000 (which, technically, makes it a little too affordable for this five-figure slideshow).
Champs Chicken only started the Restaurant Franchise under 20K in 2022, so it may not be as well-known as some of the other entities on this list, but there are already 397 locations in the U.S.
- 500 rating franchise: 281
- CEO: Shawn Burcham
- Business headquarters: Holts Summit, Mo.
- Franchise since: 2013
- Initial investment: $9,000 to $349,000
- New units in 2016: -21 units (5.0 percent)
- Training: 28+ hours on the job
- Marketing support: Co-advertising, ad templates, national media, social media, email marketing
The Final Word
The Restaurant Franchises under 20K benefit from the expertise and experience of the parent company. They enjoy an edge in the market because of their curb appeal and experience of direct patronage from an established customer base that already recognizes and loves the brand.
Source: franchisedirect.com and franchise500.com
