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Franchise Investors’ Guide to Fast-Food Franchises – Part 1

by Seth Lederman

The restaurant service industry, specifically the immediate service area, reported a revenue of over $239 billion in 2020, even amidst the pandemic.

Mass shutdowns and social distancing significantly impacted many businesses across the nation, and franchises were no exception, although they fared better than the rest. And although the economic impact is still looming as we head into the second quarter of 2021, there are some industries that not only appear to have weathered the storm, they have experienced a surge and appear to be headed into a renaissance for years ahead. The restaurant service industry, specifically the immediate service area, reported a revenue of over $239 billion in 2020, even amidst the pandemic. 

The current figures show that fast food is responsible for more than $570 billion, which is more than most small countries’ value. And forecasters predict that there will be a 2.5% annual growth in the coming year. Although that percentage is behind pre-pandemic growth, it is an indication that restaurants are making a quick comeback, even with COVID still looming. 

Americans report as many as 200,000 fast-food eaters, with estimates that more than fifty million partake in fast food daily. And the fast-food industry is responsible for employing more than four million workers in the United States. Fast food and fast-casual food are categorized as Quick Service Restaurants or QSR. The QSR segment accounts for over 50% of all sales in the restaurant sector. Although fast food dominates the industry, fast-casual is quickly gaining in popularity. 

Leading QSR Segments 

Double bacon cheeseburger

Top Five QSR Segments by Market Share

  • Hamburger-focused restaurants – 30%
  • Pizza parlors – 15%
  • Sandwich shops – 12%
  • Chicken restaurants – 8%
  • Mexican restaurants – 7%

Why Fast Food is So Popular

Fast food has been around as an icon in American history for as long as most of us remember. One of the reasons it maintains its popularity is that established franchises offer predictability and consistency. The menus from one location to the next vary little – if at all – and customers know what to expect and what their experience will be, no matter what region or location they visit. Another allure is the price. Fast food outlets target lower-cost food options, which is highly attractive to many Americans. 

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What kind of franchise business will match your skills, experience, passions and even more important...your personality? Answering these questions now, will save you time and grief during your search.

Industry Guides

Learn about the various franchise industry segments, from Home Services to Beauty, and more. With nearly 4000 available franchise opportunities, understanding the pros and cons of the industries is crucial for a successful franchise search.

Events

Having helped hundreds of people get into business ownership through franchising, we are in a unique position to educate prospective franchise investors.

How-To Articles

On our quest to share the best in franchise information, we've developed a series of How-To articles with practical advice to move you forward in your franchise search.

Videos

View our collection of educational franchise videos for large investors and first-time entrepreneurs.

Blog

The FranBlog is a trusted digital publication, providing news and information that entrepreneurs and franchise investors want.

LEARNING CENTER
Basics

Are you sick of the 9-5 grind and actively looking for alternatives? Start with the basics of going into business for yourself.

Intermediate

Searching for the right franchise opportunity is like looking for a needle in a haystack. If you want to search smarter, not harder, check out the franchising insights and knowledge to get you there faster.

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You've decided to explore franchise ownership. Now, making it a reality with tips for vetting, funding and minimising the risk of your franchise investment.

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