It is time for me to circle back around and write about my favorite topic, food. Specifically restaurants and the Food & Beverage industry. It is the largest segment in the franchising world, and I don’t foresee anything replacing it … ever. Part of the reason I think is that we all are consumers. Parents with a young child may be a student of Mathnasium, one of our education brands; a business with travelling employees may be a customer of Regis, our office co-working brand client. Every business has a target market that it appeals to. However, we are all potential consumers of a particular restaurant brand. Most of us are willing to give any new restaurant that opens in our area a chance, regardless of its style or type of food. I think this simple fact gives great restaurant brands a special place in people’s minds and hearts (and stomachs), and keeps it as one of the most popular investments in franchising.
There are many types of restaurants, and they are often categorized as quick service, fast casual, casual or fine dining. Casual dining has always been the largest market segment though and if we look a little deeper into people’s behaviors we can see why. A recent survey from FinanceOnline found that 90% of people say that going to a restaurant is enjoyable. About 45% eat out more than twice a week, and another 40% view eating at restaurants as a part of their “lifestyle”. So, while we go to a QSR like McDonald’s when we are in a hurry, or maybe some exclusive fine dining restaurant for our 10th anniversary, casual dining is our “bread and butter” so to speak, or the restaurants we visit regularly. A “roadhouse” is a sub-category of casual dining that normally focuses on evening meals, has a substantial bar and alcohol component, and popular music.
For clarity, a casual dining restaurant is normally order/receive food/pay at the table (table service), has attractive but not fancy ambiance, and is comfortably priced so we can go often. They normally serve both lunch and dinner, with some open for breakfast. Normally they target the middle class, but also attract the upper, and even the lower at reduced frequency. Good Service, food quality, value for money, and convenient locations are the main drivers for success.
I have worked with 20+ casual dining brands in my career, and our company represents and assists many as well. Over the past 13 years, VF Franchise Consulting has successfully helped dozens of F&B brands expand within Asia. Many people ask me questions like: “What is the best?”, “Which one makes the most money?”, and “Which one is worth investing in?” Some of these are personal choice questions and are hard to answer. For example, I might say, Mango Tree because I love Thai food, and as it is opening in a few weeks here in Ho Chi Minh City, Vietnam, it has been in my mind recently. Someone else may pick something completely different. But let’s look at quantifiable questions and answers.
I am going to introduce you to America’s casual dining leader. A market leader for the past 30 years, with statistics that you would likely not believe if they weren’t proven facts. A world favorite both for customers and investors …… and one here in Asia, you may not have heard of.
Ever since their first restaurant opened in 1993, Texas Roadhouse has stood out from the crowd of casual dining restaurants. As it hit its 100th restaurant in 2001, and its 500th in 2016. it has truly become known globally for its legendary food and legendary service. Moving internationally in 2011, it continues to find traction in the Middle East and Asian markets with successful stores in Taiwan, UAE, Korea, China, and the Philippines.
You can find out more about this exciting brand through the links at the end of this article.
I love Asian food, but I think we all have to agree that there are a few things they aren’t known for. Steaks and ribs being two of those. Even in the largest cities in Asia, like Bangkok, Manila, Ho Chi Minh, or Taipei, it is not uncommon to have only a handful of good steak, rib, and hamburger restaurants. Those few that do exist are normally very premium in their pricing and suitable only for special occasions. This general lack of options in Asia leaves a huge market potential for Texas Roadhouse, which provides very high quality food and service at a very reasonable and comfortable price. It really is a “legendary” value for many diners.
Match a food category that has huge gaps in the market with almost no competitors, with a brand that has amazing food, reasonable pricing, legendary value for money, proven strong economic model and ROI and you simply have a recipe for success. What about our earlier investment questions though?
Texas Roadhouse is a publicly listed company, so information is easy to get and to verify. Let’s look at just a few numbers and see how Texas Roadhouse stacks up as an investment. As a company they grow year on year, including in the difficult years of 2020 and 2021! In fact they were up in revenue 15.9% in 2020, and 22.7% in 2021. While many F&B companies were bleeding, Texas Roadhouse was paying dividends to its shareholders.
Comparable restaurant sales increased 8.6% in 2020, and a whopping 18.5% in 2021. New restaurants continued to open, and each restaurant continues to average more than US$5million per year in sales.
If these numbers don’t jump out as being impressive, they should. I do not know of any other restaurant brand that can boast numbers like these. They may or may not be #1, but they are #1 among the brands I know by far.
Casual dining remains an interesting industry segment both for consumers and investors. Opportunities exist across all regions for 2022 as the past few years have left gaps in the market.
If you live near a Texas Roadhouse and haven’t visited yet, do yourself a favor and go. You won’t regret it. There’s a very high chance you will want to return again and again!
As an investment, Texas Roadhouse isn’t available to just anyone. They are looking for established F&B companies with extensive resources in terms of manpower, experience, local market knowledge, and finances as franchisees. If your company matches those qualifications, you should speak with us about adding Texas Roadhouse to your portfolio. You simply can’t make a better choice than #1! They receive far more inquiries each year than they accept, but VF Franchise Consulting can help your company get noticed and reviewed.
You can read more about Texas Roadhouse on our website here: HERE
As well as watch some concept videos here: HERE
There are many great casual dining brands that are actively seeking expansion in Asia. To see some available in your country, check out our website:
VF Franchise Consulting – Franchises for sale in Southeast (South East) Asia
Robert Beausoleil is a franchise broker and has been visiting Asia for 25 years, and has lived in Vietnam for more than 12 years. He works as the Director of Business Development and Franchise Operations for VF Franchise Consulting. He has extensive experience in franchising, both for franchisors and franchisees. You may contact us at info@vffranchiseconsulting.com.
