Optimism and Opportunity: Franchise Growth Takes Center Stage at RFDC

Industry leaders at the Restaurant Finance and Development Conference (RFDC) shared strategies for franchisee acquisitions during the panel "Accelerating Growth: Strategies for Franchisee Acquisitions." Among the notable speakers was Michael Arrowsmith of National Franchise Sales, whose insights contributed to an optimistic outlook for the year ahead.

While 2024 marked an industry low for some, the panelists expressed confidence in the potential for growth and opportunity for 2025, pointing to the emergence of strong new brands, a shift in interest rates, and an increase in distressed asset situations that may help meet the high demand from buyers. The discussion centered on how franchisees can position themselves strategically for acquisitions. The consensus? It all starts with proper research.

• Build a Strong Foundation: Panelists emphasized the importance of carefully evaluating brands. Franchisees should consider whether the brand aligns with their portfolio and offers the potential for a true partnership.
• Secure Financing Early: Establishing financing and screening deals—ideally even before signing a letter of intent (LOI)—sets a clear path forward.
• Prioritize Due Diligence: Taking the time to thoroughly vet every aspect of an acquisition is critical to long-term success.

The panelists highlighted the importance of mindful development commitments with the franchisor, careful lender selection, and identifying the type of nuances that can hinder the acquisition process, i.e. leases, escrow, etc.

The panel’s overarching message was clear: the franchise acquisition landscape is poised for a rebound, but success will come to those who are prepared and ready to act upon the shift. As Arrowsmith said, “As this environment gets more and more positive and we have that alignment of buyers and sellers coming together… if you’re in this space and you’re in this room, buckle your seat belts because this is going to be a good ride ahead.” For franchisees and industry professionals alike, the optimism shared at this year’s RFDC sets the stage for significant growth and acquisitions for 2025.