A Useful Franchise News Roundup For May 24

sandwich and restaurantsandwich and restaurant
Reading Time: 2 minutes

This roundup comes to us via BizEngine.

Shrinking In Order To Grow

Seriously, restaurants? Who wants smaller products? This is America, where we like our hamburgers as big as our trucks, which in turn are as big as our artery blockages. How dare you impose your crazy downsizing of desserts upon us, Dairy Queen?!

That might be our default attitude, but it turns out that companies like Dairy Queen that are offering small desserts are seeing big dividends:

Downsized desserts make diners feel better about tacking a treat onto a full meal, and restaurants can make more money off them by charging higher prices, said Michael Keller, chief brand officer at Minneapolis-based Dairy Queen.

“Consumers are willing to pay a little bit of a premium for the mini Blizzard,” Keller said. “That has helped our operators protect their margins.”

What gives? Increasingly health-conscious Americans want to eat Blizzards and Oreos and steaks smothered in butter, but they want to feel less guilty about it. By making these treats smaller, restaurants have a chance to appeal to the calorie-counters among us without drastically transforming their menus.

It’s a smart business move, in my humble opinion.

Free Meets Profits

Travel Weekly has an interesting look at how hotels leverage no-cost services—the words “continental breakfast” have become permanently associated with free, for example—which may not seem like the best way to pull in revenue at first blush. Just like smaller desserts, however, there’s a reason so many hotels are trafficking in free services.

According to numerous studies cited by Travel Weekly, such free services are a big motivator when travelers choose a hotel. If you can make your own waffles and pancakes in the morning, just the way you like, and nobody’s standing there with a bellhop uniform, a hand out and a patient smile, you’ve got a competitive advantage over a hotel that charges you for breakfast.

The interesting thing in this situation will be seeing how far hotels will go to get your business. I’m guessing it will stop somewhere short of free rooms, for obvious reasons.

India The Next Frontier For Franchise?

This particularly interesting interview with Hilton executive Christopher Nassetta helps to explain why India is becoming such a focal point for overseas franchises. The rapidly growing country has embraced efforts for most companies to come abroad, and its growth is showing no signs of slowing down. That makes for a compelling picture, and Hilton is aggressively pursuing new franchisees in the country.

Photo credit to superfloss at http://www.sxc.hu/photo/1071505

Join Us On Facebook | Follow Us On Twitter