Are Restaurants Recession-Proof?

March 2, 2016

At a recent conference the topic of recession came up.  Thankfully, we’re putting more and more distance, financially, from that dreaded fall of 2008, but its still fresh enough in our minds to wonder when the next one will occur.  Personally, I think it is a bold statement to label anything “Recession-Proof,” but I think it is fair to say certain restaurants are “Recession-Resistant.”

I came into this company (Erbert & Gerbert’s) just after the recession hit, and I’m exceedingly pleased to see how our franchise system performed throughout that tumultuous time, increasing our comparative sales each year!  Looking back, I think there are a lot of factors that insulated us that I’ve listed below:

1.)  Food is an essential good.  People have to eat in order to survive, so regardless of the situation food will need to be purchased.  Having said that, some restaurants took a major hit during the recession.  Mostly, they were high-end, fine-dining, or otherwise full-service restaurants.  Quick-Service restaurants, like ours, faired better due to our affordability (both from the consumer side as well as the food cost side)

2.)  People still seek comfort.  Perhaps even more so in down-trodden times, consumers seek out things to make them feel better, or forget about their troubles.  Often times they turn to “comfort food”.  Comfort food is a broad term, but it implies simplicity and familiarity.  Sandwiches and soup, of course, fall into this category.

3.)  We have a system full of progressive franchisees.  Business owners who are aware of consumer mind-sets and can adjust accordingly; offering specials, ramp up advertising efforts, etc.

 

If you’re of the mind set to open your own business, but want to temper that with a stable industry I would suggest seeking out esstential goods industry and brands, such as ours, for consideration.  Click the FRANCHISE tab in the banner at the top of this page for more info on opening your own Erbert & Gerbert’s!

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