Juice Bar Franchises Biggest Vulnerability | Juice Bar Experts Podcast Episode 38
Juice Bar Franchises Biggest Vulnerability
The Juice Bar Experts Podcast. Exploring all things relating to opening and scaling a successful juice bar business. In this episode, we are talking about the biggest vulnerability juice bar franchises face. Enjoy this episode with your host Andrew McFarlane, founder of the Start A Juice Bar Agency and multiple juice bars, and consultant to juice bar entrepreneurs around the world for nearly a decade.
Are you torn between starting your own juice bar or buying into a franchise?
We’ve learned from over a decade of experience within the juice and smoothie bar sector as well as many of our clients what the biggest vulnerabilities of franchises are in this modern era of juice bars!
In this article, we will discuss some crucial elements that you probably haven’t considered when it comes to buying into a franchise.
Before we jump into these vulnerabilities it’s important to distinguish that there was and is an old paradigm of juice bars where customer psychology and what they value is very different from what is taking place in the franchise that is emerging in this new paradigm today. This change itself is one of the major vulnerabilities in this new age.
In the old paradigm, companies like Tropical Smoothie or Smoothie King are not focused or concerned with the evolved health-conscious demographic. The motivation behind a customer’s purchase is very different from the new paradigm motivation. For the old paradigm, the customer is focused on great tasting cold smoothies rather than the health element of bettering their overall health.
These companies will to some extent always hold a place within the market however, their place is expected to shrink due to the healthy demand within the market. Therefore, if this is the sector of business you are considering it is important to acknowledge this.
The new paradigm is a customer base that is quality-focused and is driven by the health benefits, looking to consume products that will support them, maybe even with chronic illnesses or more severe conditions. Their psychology and reason for buying these juices and smoothies are very different from the old paradigm.
As a franchise you are given a set menu that you are unable to adjust, this is both a gift and a curse. It benefits you as you are saved time as the menu is already developed, however, it is also a downfall.
Your Menu is one of the lifelines of your business and if you can’t make adjustments to this you won’t be able to adapt to customer demands in this new era.
Customers within the new paradigm focus on quality and want to experience the latest superfood and trending products.
For example, at this point in time (2019) we are going through a very big celery juice trend and still inside it. People are learning about the digestive benefits of juicing this vegetable as well as clearing your skin. What if your franchise doesn’t have this trending product on their menu? Although this product is trending, it will remain popular due to health benefits. These trends will evolve and your customers want your support by including these trending products in tasty smoothies and juices.
If you’re in a franchise with a set menu your ability to evolve with these trends will be compromised if not halted completely. You don’t have control over what you serve your customers which can stop you from meeting the demands of your customers. In the old paradigm, this factor would not cause an issue as customers were not concerned with ingredients, therefore, did not need to worry about changing their menu based on trends.
Another key factor that is important to understand as it relates to adapting your menu, is when it comes to controlling your product costs. Your recipes are going to dictate your profit. Sometimes the prices of certain ingredients fluctuant due to demand or low production.
As a franchise, you are vulnerable as a corporate company dictates your menu prices and recipes and you do not have the greatest asset as a small business, which is flexibility and versatility to adjust your product to maintain your margins.
Having a storefront is beautiful because you get face to face feedback with your customers. This is one of the greatest assets in your business evolution. What if you find out what worked today is no longer working? If you are in a franchise agreement, you will not be able to make the crucial changes necessary to adapt.
In many situations, franchises force their franchisees to use vendors that are only approved by the parent company. Not being able to source your own vendor as you desire will be a disadvantage to you, as ingredients are one of the biggest outgoing costs for a small business. As you are unable to select your own vendors, you are unable to stay on top of prices that will benefit your business.
You owning your brand gives you the freedom and responsibility to respond to your market that will likely happen so slow that it doesn’t actually benefit you.
It may go without saying that we have a clear preference for people to own and launching a unique concept. We specialize in supporting our clients develop these businesses from start to finish without locking them into any of the downsides of traditional franchises. Most franchises in the new paradigm are fairly young (at most 6 years,) we’ve been doing it for over a decade.
Finally, I feel called to mention that there’s a big misconception surrounding franchises.
Franchisees believe that because a brand is now at the stage of franchising, it has perfected its business model, marketing, and operational processes.
This is not true. There is no such thing as a perfect business. Even franchises have sometimes fatal flaws.
You have the capacity to run a business that is more mature than many franchises out there. Within this new paradigm, flexibility and adaptation are everything, as your customers will demand that you are up to date with what’s trending within health and wellbeing as that’s what they are inspired by.
Do you need more support to branch out away from franchises and kick start your own juice bar?
Reach out to me directly at email@example.com