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What are the Differences Between Resale and Restaurant Franchises?

The modern entrepreneur has a wealth of options at their disposal when considering a franchise to invest in. Restaurant franchises are some of the most well-known businesses in the franchise space, with household names from Denny’s to Dairy Queen. With a name like that behind your new business, it might seem as if you have nothing to worry about, no matter the challenges of running your own business.

Resale is a less conventional franchising option, but it has some surprising benefits compared to the restaurant industry’s juggernaut, especially in light of the past two years of turbulence.

Restaurants Struggle to Stay Afloat During the Pandemic

Nearly everyone is familiar with the experience of visiting a restaurant during the pandemic, especially at its height: cordoned off tables with chair legs sticking in the air like forbidding spikes, plexiglass shields, signs and neon tape showing customers where to stand.

Some restaurants were lucky to have an order window, but many others had to come up with clever ways of accommodating a line of guests. In contrast, others had to figure out a way to tailor their menu to take out, and many other restaurants didn’t have the means to take online orders at all.

Restaurants are designed around the in-person experience, and when in-person dining became a necessary rare occurrence, it put the whole industry in turmoil.

The pandemic is ongoing, and entrepreneurs looking for their next franchise opportunity will want to carefully consider the complex issues surrounding opening a business in the restaurant industry. You’ll want to be aware of your state laws in accordance with your employees’ vaccination statuses, laws about dine-in customers and other matters, in addition to the fact there have been significant restaurant labor shortages.

The restaurant industry has suffered during the pandemic, and as we’re not out of the woods yet, franchisees in the restaurant industry can expect more obstacles.

In the meantime, the resale industry has continued to expand despite the ongoing challenges in the current environment.

Resale Franchises Become Essential in Uncertain Times

The resale industry has historically overcome difficult periods where other businesses struggled. In fact, during the 2008 recession, resale not only remained level but showed growth. Nearly two-thirds of U.S. resale store respondents reported an increase in sales, by an average of 31 percent, according to a 2009 National Association of Resale & Thrift Shops (NARTS) survey.

During this most recent time of stress, resale franchises have shown even more promise. While dining out is a luxury not everyone is willing to afford, the resale industry provides benefits to consumers in a couple of different ways:

  • People still need new clothing or other household items, even when they have less money to spare. Businesses like Style Encore®, Plato’s Closet® and Once Upon a Child® allow customers to buy clothing at a lower price without sacrificing quality. In fact, resale franchises retain customers who might otherwise have to cut shopping out entirely in any other industry.
  • Franchising with a resale business also gives customers the ability to sell gently used items to your business. This unique feature means that customers can come to you even when strapped for cash and earn money on the spot. These customers know they can make the money they earn go further with a resale store than other businesses, and that’s just one of the reasons why they keep coming back.

If you’re looking for a market that performs even better in uncertain economic times, resale is for you. The restaurant industry has some of the most well-known brand names, but that doesn’t keep their franchisees from struggling in this new environment.

Want to invest in a business you can trust no matter the economic climate? Contact us today to learn more about franchising with Winmark – the Resale Company™.