MUFC Advisory Board Looks Ahead to 2025, part 2

Here we are, a mere two weeks into 2025, one week before a new administration is sworn in, and the uncertainty needle is swinging wildly between optimism and uncertainty. While multi-unit restaurant franchisees look forward to relaxed regulations, they also are worried about the bluster around mass deportation—not only for finding staff, but also for finding customers! Here’s Part 2 of what our Multi-Unit Franchising Conference (MUFC) Advisory Board foresees for 2025. Find Part 1 here.

Franchisees attending the conference will have the opportunity to meet several Advisory Board members—and each other—live and in person at the Franchisee-Only Welcome Mixer.

We look forward to seeing you in Las Vegas March 25–28!

Franchisee Bytes: What are your 2025 goals?

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ROB BRANCA

Rob Branca is the elected leader in the Dunkin’ Donuts Brand Advisory Council, Chair of Northeast US Region, Member of the IFA Board of Directors, Chair of Inspire Brands’ Government Affairs Committee, IFA Franchisee of the Year, and Past Chair of the Multi-Unit Franchising Conference. He and his direct family partners own and operate more than 200 Dunkin’ locations.

The bifurcated economy in the U.S. is no secret; higher-income consumers that own homes with historically low mortgage rates and any other assets have been more than fine, and are expected to continue to be so in the coming administration. Lower-income consumers have had a very different experience, and many franchisees should position themselves to capture the business of this economic cohort as they, hopefully, achieve more disposable income and economic freedom.

Franchising already supports this exact opportunity through franchise ownership itself and the upward mobility of people who work for franchise owners, so it is only natural for franchising to advocate for and foster policies that promote economic freedom and upward mobility. Importantly, it is vital that those in communities that have too rarely seen these policies benefit them share in these rewards. It is not only the long overdue right thing to do, it is an existing, largely untapped economic growth engine.

Multi-unit franchisees have always seen and pursued expansion opportunities made available by stimulus spending legislation, whether to build new units, invest in efficiency-enhancing or traffic-boosting remodels and relocations, or add new brands. I see this potentially expansionary economic period to be no different. Established brands with strong franchisee bases are best positioned to move to seize the most desirable opportunities because of their experience, established support and capital networks, extensive due diligence, and market knowledge that comes second nature to them.

AZIZ HASHIM

Aziz Hashim is managing partner of NRD Capital, whose portfolio includes Ruby Tuesday, Frisch’s Big Boy, Fuzzy’s Taco Shop, and The Captain’s Boil. In 1996, he founded NRD Holdings, which grew into one of the largest restaurant franchisee companies in the U.S. with brands that included Popeyes, KFC, Taco Bell, and Domino’s. In 2014, he founded franchise-focused PE firm NRD Capital and served as Chair of the Multi-Unit Franchising Conference. In 2016–2017, he served as Chair of the IFA. His current initiative is called SocialBites.

The devasting impact of inflation has had its effects on the economy and the political climate. For the average American, affordability of everyday goods and services has reached historic lows. There are no signs this trend will reverse because operating costs at the retail level don’t often decline. So retail prices, while not increasing, are unlikely to go down. Unit-level economics (ULE), therefore, remain key, as always. Brands that offer superior ULE will attract franchise development. Those that don’t will have to revise their business model to ensure their franchisees can get an acceptable ROI.

We continue to focus on driving ULE across all our brands to respond to financially strained consumers by ensuring that our brands can sell their products to customers at competitive prices, while still making a good return on invested capital for our franchisees. Discounting to drive traffic while ignoring unit profitability is a risky and unsustainable strategy in our view.

Finally, labor conditions must be monitored vigilantly. In areas where labor is increasingly challenged, development should be redirected to areas where labor is more plentiful.

GRANT SIMON

Grant Simon, a serial entrepreneur with more than 30 years of business management experience in the retail, food, and service sectors, is co-founder and CEO of LSGF Management where he oversees multiple Smoothie King, Great Clips, and T-Mobile locations.

Because regulatory compliance correlates to number of employees or revenues, some multi-unit franchisees have had to reconsider growth strategies. The new administration’s intent to relax federal requirements could alleviate growth pressures and create a more robust business environment. With interest-rate cuts projected in 2025, the lower cost of both capital and existing debt will be another growth catalyst for franchisees.

ROCCO FIORENTINO

Rocco Fiorentino is Vice Chair and CEO of Benetrends Financial and a director and board member for Swiss Farm Stores and Saxbys Coffee. On the franchisee side, he was Krispy Kreme’s first area developer and multi-unit franchisee, responsible for Pennsylvania, New Jersey, and Delaware. He was MUFC Conference Chair in its early years, and this year begins a 3-year term on the IFA Board of Directors.

My vision for the economy in 2025 is extremely positive. Most experts expect GDP growth of 2.5% for the U.S. this year—certainly a more bullish outlook than the 1.9% consensus forecast from economists surveyed by Bloomberg. The U.S. economy is in a good place. I believe recession fears have diminished. Inflation is trending back toward 2%, and the labor market has rebalanced but remains strong. All indications are that the S&P 500 is expected to have a 10% return for 2025.

I believe the latest consumer confidence index is certainly much more positive than we have seen it in quite a while, and Americans are feeling better about the economy. What this means is that Americans will continue to open their wallets, purchase big-ticket items such as automobiles and homes, and continue to reinvest in their businesses. Energy will also play a big role in consumer spending habits this year. I anticipate energy costs will drop in the first quarter, providing more discretionary income to consumers. I believe anyone sitting on the sidelines during the recent election year should be off to the races, get back in the market, and get ready for a solid year ahead.

To prepare, first lead your business with more confidence, intention, and clarity in 2025. Second, develop your leadership team to lead alongside you—your business is only as strong as the leaders beside you. After all, no matter how hard you try, you can’t do it all yourself. Investing in developing your leadership team means investing in the sustainability and skill ability of your business. Third, prepare your strategy; get your organization aligned to a shared vision for the future. Please make sure your shared vision is not just your old vision. A lot has changed. Revisit your strategy, your vision, your mission, and your purpose. Get input from your team. Don’t do this alone!

JOHN HOTCHKISS

John Hotchkiss operates multiple Little Caesars Pizza and Firehouse Subs locations. He also is involved in real estate development in Texas and Louisiana.

I think the middle and lower classes of our society will continue to suffer financially, unfortunately. Franchisees whose businesses sell goods and services to the upper classes will do great since they’ll have more money to spend. Inflation and low or stagnant wages for the poor and middle class will probably continue. Multi-unit franchisees should consider diversifying their investments to take advantage of opportunities that align with Trump’s new economic plans.

BROOKE WILSON

Brooke Wilson, a multi-unit franchisee of Two Men and a Truck since 2004, owns and operates markets in Georgia and North Carolina. Although not a restaurant franchisee, she provides excellent advice and perspective for growing your franchise business in 2025, no matter what industry you’re in!

For my business, 2025 is about continuing to create value by focusing on brand awareness, enhancing customer experience, and leveraging technology for operational excellence. Succession planning remains a key priority, ensuring that our operations are poised for sustainable growth in a competitive marketplace.

Multi-unit franchisees will face both opportunities and challenges as private equity continues to reshape the franchise landscape. Consolidation is likely to increase, potentially limiting market entry for smaller operators while creating opportunities for larger operators to expand their portfolios.

Economic pressures, such as inflation, labor shortages, and interest rate fluctuations, will continue to strain margins, requiring franchisees to innovate and optimize their operations. Political changes in 2025 may bring new labor policies, minimum wage adjustments, or health care regulations, all of which will demand careful financial planning and adaptability.

Here are 5 ways multi-unit franchisees can prepare their businesses for 2025:

1. Strengthen financial planning. Anticipate potential economic shifts and allocate resources strategically. Evaluate costs, identify areas for efficiency, and maintain liquidity to weather any uncertainty.
2. Focus on succession planning. Whether transitioning ownership or expanding operations, ensure leadership pipelines are in place. Prepare for long-term stability by identifying and training successors or key management staff.
3. Leverage technology. Invest in systems to improve operational efficiency, enhance customer experience, and provide data-driven insights to make informed decisions.
4. Adapt to workforce changes. Stay ahead of potential labor policy adjustments by investing in employee training, offering competitive benefits, and fostering a strong workplace culture.
5. Maintain brand integrity. Work closely with franchisors to ensure alignment with the brand’s long-term goals. Protect the customer experience and community relationships.

By remaining proactive, adaptable, and focused on creating value, multi-unit franchisees can thrive in a rapidly evolving economic and franchise landscape.

FRANCHISEE BYTES

What are your 2025 goals?

I have a clear vision for growth for the year. My primary goal is to open five new Tropical Smoothie Cafe locations and expand our footprint in key markets. In addition to that, I’m focused on increasing same-store sales by 4% year over year, improving service times by 5%, and reducing food costs by 2%. Employee retention is also a top priority. Ultimately, I want to continue building a solid foundation for long-term success while ensuring that my team, my guests, and my franchisors all benefit from this growth.
—Jacob Webb, Franchise Owner, MPUT Holdings LLC, 22 Marco’s Pizza, 4 Tropical Smoothie Cafe

Ideally, I’d like to open two more new stores, particularly in airports and military bases. Across the board, I’d also like to lower costs on my existing locations.
—Yousuf Nabi, Owner & CEO of Gotham IP Inc., 10 Mrs. Fields, 10 Sbarro, 4 TCBY

Open a Sonic location in Dumfries, Virginia, and remodel three stores.
—Jerome Johnson, Multi-Unit Franchisee, John Cove Management and Jbar Inc., 10 Dunkin’, 4 Sonic Drive-In, 4 Baskin-Robbins, 1 Jersey Mike’s Subs

Drive sales by investment spending on advertising and drive profitability by 3 points by giving the managers an increased portion of the profits. When they win, we win.
—James Brajdic, President, Customer Maniacs & Green Bay A Dub, 13 A&W

Diversify into additional brands via strategic partnerships.
—Bryce Bares, Franchise Owner, QSR Services LLC, 30 Dunkin’, 1 Baskin-Robbins

Continue to add to the Vibe Restaurant platform with the addition of some key hires: VP of real estate and development, VP of learning and development, VP of IT, and a director of facilities.
—Irfaan Lalani, CEO/Co-Founder, Vibe Restaurants, 76 Little Caesars, 60 Wingstop, 3 Whataburger

Enter a chicken brand (complete), eclipse $325 million of annualized revenue (on track), and make 20 internal management promotions (on track).
—Mike James, Founder, Managing Partner, Guernsey Holdings, 122 Sonic Drive-In, 20 Zaxby’s, 3 Take 5 Oil Changes, and a 53-unit development agreement with 7 Brew Drive-thru Coffee

Opening new restaurants for each brand and completing remodels.
—Keith Johnson III, COO/Franchisee, Amazing Food Concepts. 20 Qdoba Mexican Eats, 15 Captain D’s, 1 Epic Wings

Integrate our four acquisitions, open new and remodeled existing restaurants, and finish building out the team so we have the infrastructure to grow. For Burger King, it is reinvesting in the restaurants through remodels, updating the technology, and addressing maintenance needs. We want to open new Potbelly restaurants and build out the organization to support growth in our target markets.
—Randy Pianin, CEO, Royal Restaurant Group, 61 Burger King, 4 Potbelly