Franchise opportunities expand in city
Growing population and career options among reasons for interest in Grand Rapids market.
As the Grand Rapids population rises, so do the opportunities for residents to own a franchise.
This month, personal finance website WalletHub named Grand Rapids the No. 5 best large city to start a business, and out-of-market franchises have noticed the healthy entrepreneurial spirit Grand Rapidians possess, said Brigitte Betser, a Grand Rapids consultant with FranNet, a franchise consulting services firm.
Betser noted a strong support network for entrepreneurs as a reason it’s a great region to start a business, and a franchise offers a less risky avenue for someone looking to start their company.
“Franchising can be a great addition to entrepreneurship in any market,” Betser said. “It can be a great way to get into owning your own business, while reducing risk.”
Among the reasons more franchises are beginning to look at the Grand Rapids market include a growing population and career options for the residents, Betser said. Drawing more people from across the country could help foster the idea of other regions’ retailers coming to West Michigan.
“Part of what could be happening is individuals moving into Grand Rapids from other states are bringing the interest from franchisors,” she said. “Those franchisors also see the solid increase in population and the developments going on here.”
Two such franchises beginning to look at franchisees in Grand Rapids are Cincinnati-based Buffalo Wings & Rings and Seattle-based Best in Class Education Center.
Buffalo Wings & Rings is a 30-year-old sports bar chain with nearly 70 locations in 13 states and several countries in the Middle East and has turned its attention to Michigan, specifically Grand Rapids.
Grand Rapids is a target for the company as the high-quality suburbs offer the demographics Buffalo Wings & Rings looks to attract, said Philip Schram, the company’s chief development officer. A modern interior, well-dressed servers and food prepped fresh are reasons Schram said the restaurant’s demographics skew older and more family-oriented.
“Wing joints typically are a place to watch a game and drink beer, but the food is not the most compelling reason to go there,” Schram said. “We buy superior quality food and make 90 percent fresh, with bold flavor.
“This is what brings us loyalty and new guests.”
Best in Class is a supplemental education center that works with gifted and delayed learners from pre-K to 12th grade, said Sharon Peterson, director of franchise sales for Best in Class. Best in Class has 48 locations in nine states, with its first Michigan location opening next month in Farmington Hills.
The centers offer tutoring, summer camps and classes and tailored curriculum for students, Peterson said.
Peterson believes Grand Rapids could support several Best in Class centers because of the strong suburbs and school districts in the area. She mentioned at least one franchisee in heavy discussions to open a center.
“We look at population density and number of students in an area and looking at the GR market, it looks like a multiunit area,” Peterson said. “We don’t want to oversaturate the market, but looking at Grand Rapids as a whole, it’s very attractive.”
Multiunit franchise owners aren’t unusual, Betser said.
“We’re seeing a rise in multiple unit development,” she said. “These are individuals looking at empire building. They have that dream of building something big, and you can do that in franchising a little bit quicker than starting something from scratch.”
She also said there’s a rise in semi-absentee ownership, or those who work at a company full time and own a franchise on the side.
“It creates an additional layer of investment and protects them from corporate layoffs and restructuring,” she said. “Their income is protected in that situation, and it helps achieve financial goals, like retirement, or provides an exit strategy from a job.”
The search for a Buffalo Wings & Rings franchisee in Grand Rapids hasn’t been ongoing for long, and there is no timeline or hurry to select the candidate, Schram said. Normally, the search takes about six months, with another six months for site selection and another six months for construction.
The company has aggressive expansion plans across the nation and globe, so if a successful franchisee search isn’t immediate in Grand Rapids, that’s OK, he said.
“This is a fresh search. Michigan has been hurt fairly badly with the Great Recession, and we’re just starting to see the interest in Michigan,” he said. “The franchisee is a critical piece of our success, and we will wait until we find the right individual; we won’t lower the standard for the selection.”
Grand Rapids is a metro area in which Best in Class desires to be, and at an entry price of $62,000 to $120,000, Peterson said it’s a low-entry but high potential business.
“Last year, we opened 12 locations and our growth is on track with that this year,” she said. “Looking at Grand Rapids, we see a strong area with a lot of growth potential.”
Buffalo Wings & Rings and Best in Class aren’t the only franchises looking to enter Grand Rapids, Betser said, and they’re following on the heels of chains such as Chick-fil-A and Freddy’s Frozen Custard Steakburgers.
“We’re in a good position,” Betser said of Grand Rapids. “We have great talent. It’s a very attractive, family-friendly community with a growing downtown.
“All of those things contribute to the attraction of franchises and industry in general.”