Three Things to Consider Before Launching a Major Expansion Strategy

In today’s rapidly evolving QSR segment, accessibility is key, with many brands prioritizing market expansion now more than ever to maximize brand presence and unlock growth opportunities in new territories. Accessibility can help with several factors including overall brand growth, new revenue streams and the recruitment of new franchisees. However, it’s essential to ask yourself several key questions before progressing with major market expansion. 

As Little Caesars’ Chief Development Officer, I spearhead our expansion efforts and craft strategic development initiatives to take our brand to the next level. Growing our business within key markets is a huge part of our enterprise strategy – we’re ready to insert ourselves into popular pizza markets and build new restaurants to increase brand accessibility in these cities. Most recently, we signed a 10-unit deal for New York City and the Tri-State area. This is a big win for the brand, but before leaping into NYC expansion, we had to make sure we were ready to grow at an exponential rate. 

Here are a few questions we addressed internally before progressing with our NYC growth strategy. Asking these questions may be helpful as you prepare for similar expansions. 

Will the Brand Resonate in the Area?

You must have a deep understanding of each market before preparing for expansion, to determine your brand’s potential and ensure it will resonate with the area’s residents. Consider consumer behaviors, preferences, and patterns as it pertains to their personal lives and their dining habits. Before expanding our reach in the Big Apple, we knew it was vital for our brand differentiators to stand out in a crowded pizza space while simultaneously aligning with what NYC’s consumers want and need. 

New Yorkers are always on the move – usually by foot – and want their food to be quick and easily accessible. Our Pizza Portal allows us to keep up in such a fast-paced environment, with onsite self-service pickup, order ahead online or through the app, and delivery options. Ease and convenience are key for consumers within this area, and our streamlined processes meets their needs by offering a variety of ways that guests can receive our products. 

In order to succeed in a competitive or new market, it’s critical to examine every aspect and identify whether your business is a true fit. 

Real estate was another factor we considered. When it comes to NYC commercial real estate, smaller concepts are quite common. Our digital-centric, minimal footprint prototypes were a great fit for the city, and our enhanced storefront designs will help attract new and existing guests alike. It’s important that your restaurant will function properly in the market you’re entering, while still showcasing key differentiators and features that will make the brand stand out amongst a crowded competitive set and ultimately drive revenue. 

Additionally, we considered whether NYC residents would truly want our products. Understanding the competitive nature of the pizza segment within the market, we needed full confidence before expanding our brand further. Little Caesars is known for our quality pizzas made with real ingredients. With dough made from scratch in-house daily, fresh, never frozen, mozzarella and Muenster cheese, and sauce made from fresh-packed, vine-ripened California crushed tomatoes – we knew we’d be able to offer an exceptional product that would live up to New Yorkers’ standards.  

In order to succeed in a competitive or new market, it’s critical to examine every aspect and identify whether your business is a true fit. 

Is your franchisee support strong enough? 

Franchisees are the bedrock of any successful franchisor. When entering a new market, it’s important to ask if you have the proper support system in place to help new and existing operators open and run successful restaurants. We had to ensure our franchisee support, including site selection, marketing, operations, etc., could handle rapid growth in new markets and it’s vital that you do the same for your brands. Key support areas include: 

• Training and Operations. Ensure your concept is equipped to operate efficiently within the market you’re entering, and that franchisees have what they need to streamline operations and keep margins as high as possible. You also want to make sure that each team member has the resources needed to fulfil their role and play their part in overall business success. 
• Supply Chain. When considering today’s industry challenges, supply chain support is important now more than ever. Whether it’s offering internal access to a primary, full-service food service distribution company like we do with Blue Line, or maintaining relationships with key providers, you want to simplify your product purchase process for franchisees and lower costs along the way.
• Technology. Tech is a huge factor as it enhances the experience for your franchisees as well as their guests. Little Caesars is technology-driven and leans into high volume sales, which is why we prioritize the enhancement of our proprietary tech, such as our Pizza Portal. This helps streamline operations for franchisees, which is vital across all locations, but especially when trying to build a consumer following in a market. It’s also important to identify off-premise capabilities prior to expanding in a market and determining if your tech is built to handle such transactions. We know that New Yorkers move fast and often prefer the ability to order ahead online, through the app, or via third-party delivery. As such, we had to ensure our technology could meet those preferences and it’s vital that other brands looking to grow do the same. 

If you offer these different levels of support to your franchisees, they will be ready to hit the ground running and open efficiently. Ensuring your support system is able to sustain rapid market growth via franchising will better ensure that openings are successful, and franchisees are positioned for long-term success. 

Can you adapt to meet local consumer preferences?  

What works for one market may not work in another, and businesses must be willing to make changes to their products, services, and marketing strategies to meet local demand. Gathering information on consumer preferences and understanding market competitors, you will learn about your own strengths and weaknesses, which will allow for you and your business to consider how to pivot for different local markets. It’s also imperative to find the right local operator. An experienced franchisee that fits with the brand will help make the necessary pivots to ensure in-market success. 

For our NYC expansion, we did consider that the city is home to several mom-and-pop pizza shops with a loyal following. For many brands, this could be a deterrent, but for the team at Little Caesars, we saw it as an opportunity to showcase how our brand can stand out and be a local favorite as a franchised restaurant. 

Although your brand may need to adapt certain features to meet local consumer preferences, your brand identity should continue to remain consistent and recognizable. Consumers expect consistency and reliability from their favorite brands, and straying too far can damage your relationship with valued customers. 

As restaurant franchisors, it’s important to ask these questions while building new development strategies.  Expanding into new markets can be a challenging but rewarding experience, and doing your due diligence will help ensure success for the brand and your franchisees.