Dive Brief:

• A majority of franchisees (92%) said the environment and climate change are of concern, according to a Budderfly survey of 500 franchise owners and senior managers emailed to Restaurant Dive. Eight-nine percent said they take these factors into consideration when making business decisions.
• More than half of the respondents in the October survey said they are implementing measures to reduce their impact on the environment, and another 25% said they would do so in the next 12 months.
• This strategy seems in line with diner sentiment. Forty-three percent of consumers said earlier this year they would pay more for restaurant takeout that prioritizes sustainability efforts, according to Deliverect research.

Dive Insight:

Operators don’t necessarily think diners feel as strongly about the environment and climate change. Only 71% of operators believe their customers care about these issues, according to Budderfly. Sixty percent of restaurant franchisees, like QSRs, said they felt that their guests cared about sustainability initiatives like recyclable/compostable packaging, while 58% of operators said their customers cared about energy efficient equipment. Seventy percent of operators said they thought customers would prefer to spend money at businesses that make efforts to become more environmentally friendly.

Many of the franchisees with sustainability initiatives in the works said their top projects were installing more energy efficient appliances (66%), replacing light bulbs with LEDs (61%), reducing waste (59%) and sourcing supplies from vendors with certified sustainable production (54%). Seventy-three percent of franchisees said that using as little energy as possible was an important part of running their businesses. 

While major brands like Yum and McDonald’s have ambitious sustainability goals, it doesn’t necessarily mean franchisees can afford to implement changes — especially when they are on the hook for equipment purchases. Twenty-one percent of franchisees said they didn’t have the staff resources to implement sustainability plans, while another 21% said that upgrades would lead to higher capital expenditures. Thirteen percent couldn’t afford the investment required. On top of that, about half of the operators surveyed said they have had issues with maintaining, repairing and upgrading things like HVAC units that have sparked operational issues, while roughly one-third said if their HVAC unit died tomorrow, they wouldn’t have the funds to replace it.

Franchisees have additional concerns beyond the environment. Eighty-five percent of respondents said they were concerned about attracting more customers, 84% said they were concerned about operational costs and supply chain issues and 83% were worried about staff availability and quality.