For real estate in any year, it’s about location, location, location. For franchised restaurants in 2025, it’s about value, value, value—providing it to customers, that is—and finding ways to do so without falling into a race to the bottom as brands compete for a smaller consumer spending pie. Factoring in higher wages and supply costs, inflation, the cost of capital, and a new administration in D.C. makes for a period of increased uncertainty… which, of course, means both danger and opportunity. There’s plenty of advice out there online. Here’s one from Forbes, published last week, titled “How To Turn Uncertainty Into a Positive Force Inside Your Organization.” You get the idea.
Multi-unit restaurant franchisees seeking to grow their organizations in 2025 are already gearing up to attend the annual Multi-Unit Franchising Conference (MUFC) in Las Vegas this March 25–28. See you there?
Franchisee Bytes: How do changes in the economy affect the way you do business?
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DAVID OSTROWE
Company: Founder & CEO, O&M Restaurant Group
Brands: Taco Bell
Years in franchising: 34 (24 on the franchisee side, 10 on the franchisor side)
David Ostrowe, Incoming Chair of Franchise Update Media’s 2025 Multi-Unit Franchising Conference, is the founder & CEO of O&M Restaurant Group, a Taco Bell franchisee. In addition to his successful franchise operations and related businesses (Personalized Management Associates, O&A Consulting, 180 Business Solutions, Career Lead), he’s served as Oklahoma’s Secretary of Digital Transformation and Administration, and was Chairman of the Board of Trustees for Oklahoma’s Lottery Commission.
I’m genuinely optimistic about 2025. The tide seems to be turning on overregulation, with Trump signing executive orders to cut red tape within hours of his administration taking office. This, combined with the administration’s alignment with Congress, feels like a breakthrough moment.
For the first time in years, there’s actual dialogue and collaboration on the issues that matter. A targeted reduction in federal spending should further strengthen the dollar, which will have a cascading effect on managing daily operational costs. A stronger dollar means better purchasing power—something every franchisee and franchisor can celebrate.
Moreover, the push to get people out of their homes and back into offices is long overdue. Increased office attendance should fuel retail traffic, which, when paired with lower costs, could provide the perfect formula for revitalizing both franchisees and franchisors. This could very well be the shot in the arm the economy has been waiting for.
On the capital side, the outlook is just as encouraging. Growth will inevitably attract capital markets, making it easier to secure funding at favorable rates. For me, the focus will be on finding top-tier talent and feeding them fresh opportunities. The key is to double down on the pipeline of deals while fostering a culture that attracts the best in the business.
That said, the lingering effects of the post-Covid era are still evident. The constant threat of higher interest rates, paired with tighter margins, has been brutal for everyone—veterans and newcomers alike. “Survive until ’25” has been my rallying cry, and now that we’re here, it feels like the perfect moment to shift gears.
Ultimately, I see 2025 as a golden window for acquisition and development. The challenges of the past few years have thinned the herd, creating an environment ripe for strategic growth. For those prepared to act, the opportunities are limitless.
ZANE TANKEL
Company: Chair/CEO, Apple-Metro
Brands: Applebee’s
Years in franchising: 30
In 2011, Zane Tankel was named Multi-Unit Franchisee magazine’s MVP (Most Valuable Performer) for outstanding performance and innovation growing his organization and brands. At the time, he was CEO of Apple-Metro, which owned and operated every Applebee’s in New York City and nearby Westchester and Rockland counties. In January 2024, he sold 21 of his 23 remaining Applebee’s, keeping one in Staten Island and one just north of Times Square—the world’s largest and top-grossing Applebee’s, whose 3 stories and 14,000 sq. ft. can accommodate 400 diners.
2025 will be—and is—all about “value.” Not discounts, but value. For example, free delivery, unlimited fries, extra free drinks, free appetizers for late night meals, etc.
TAMRA KENNEDY
Company: Twin Cities T.J.’s
Brands: 6 Taco John’s
Years in franchising: 40
Tamra Kennedy is an IFA Foundation Board Trustee, an IFA Board Member, and Past Chair of the IFA’s Franchisee Forum.
Both our challenge and our opportunity in 2025 is to find substantial, inventive ways to enhance value for our guests. Value, after all, should not be reflected only as a discount or a sale price on an item. Too often, we see brands become trapped in a circle of chasing guest count with discounted offerings, only to realize the guests don’t return unless it is for items that are discounted. If we laser focus on value as a quantifiable opportunity, we should message and bundle exceptional service, speed of transaction, error-free interactions, and of course, perfectly made, delicious tacos. This can be hard to transmit in a 30-second commercial where most of the time is spent on “the deal.” My stores continue to focus on two things: 1) Our belief that “We Live in a Busy, Hungry World,” which drives our production team, and 2) Our purpose, which remains “Our Family Feeds Friends.” There is always value to be found in execution above what guests expect—because it’s what we know they deserve!
LOU GIOIA
Brands: 7 Rita’s Italian Ice and Frozen Custard
Years in franchising: Franchisee since 2017 (in the Rita’s system 20+ years and was store manager before becoming a franchisee)
One of the biggest challenges we face as expanding multi-unit franchisees is the rising cost of real estate, particularly when trying to expand into already densely populated areas. Securing affordable and strategic locations remains a constant hurdle for growth. On the opportunity side, I see significant potential in online and mobile ordering. At my Rita’s locations, we’ve already experienced growth through third-party delivery services, and I anticipate that trend will continue to accelerate. Leveraging these platforms not only enhances customer convenience, it also opens new revenue streams, allowing us to better serve our loyal customers while reaching new ones.
FRANCHISEE BYTES
How do changes in the economy affect the way you do business?
Economic shifts affect everything from pricing to labor strategies. For example, inflation has required us to reassess product bundling and promotional offers to maintain perceived value. We’ve also implemented tight labor controls to manage costs while still delivering a high-quality experience for customers.
—Jacob Webb, Franchise Owner, MPUT Holdings LLC, 22 Marco’s Pizza, 4 Tropical Smoothie Cafe
After rapid inflation, consumers are increasingly price-conscious, which has required us to focus on value.
—Bryce Bares, Franchise Owner, QSR Services LLC, 30 Dunkin’, 1 Baskin-Robbins
The economy requires us to stay adaptable. Remaining static isn’t an option. We have to pivot and find creative solutions to navigate economic shifts. I believe monitoring costs is essential—especially during unpredictable times—to maintain stability and resilience. It’s about preparing for tomorrow, not just surviving today.
—Yousuf Nabi, Owner & CEO, Gotham IP Inc., 10 Mrs. Fields, 10 Sbarro, 4 TCBY
We had an incredible run in sales and profitability in 2024 and continue our path. We have no plan for changes.
—James Brajdic, President, Customer Maniacs & Green Bay A Dub, 13 A&W
The economy has greatly affected our menu prices. In the past, we would raise prices maybe once or twice a year. We are now changing the menu board at least four times a year to keep up with the rising cost of goods. Labor costs have gone up with the increases in minimum wage, which also affects our menu prices.
—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
After rapid inflation, consumers are increasingly price-conscious, which has required us to focus on value.
—Bryce Bares, Franchise Owner, QSR Services LLC, 30 Dunkin’, 1 Baskin-Robbins
Inflation has had the most significant impact on the QSR business in recent years. In 2022, we experienced more than 40% food cost inflation in the Sonic brand. We then reduced margins from low double digits to low single digits for several periods. We responded immediately with an aggressive menu pricing increase, which restored margins to the low double-digit range.
—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
We closely monitor our cash flow and are sensitive to pricing impacts, ensuring we manage our financial health effectively during economic fluctuations.
—Keith Johnson III, COO/Franchisee, Amazing Food Concepts. 20 Qdoba Mexican Eats, 15 Captain D’s, 1 Epic Wings
We’re continuing to do what we do best and have been able to expand our business portfolio, opening new locations. We’re also really focused on being a people-centric organization that values employees, and we’re continuing to refine how we do that. We’ve even taken the necessary steps to look at how we can make a greater impact on the lives of our employees and their families. We’re looking at education funds and similar initiatives.
—Irfaan Lalani, CEO/Co-Founder, Vibe Restaurants, 76 Little Caesars, 60 Wingstop, 3 Whataburger
