Takin' It to 'Em

Franchises help consumers too busy to cook, too tired to drive--and sick of pizza.
Magazine Contributor
2 min read

This story appears in the February 2001 issue of Entrepreneur. Subscribe »

Move over, Domino's-home meal delivery isn't just about pizza anymore. According to consulting firm Technomic Inc., home meal replacement (HMR) sales will hit $67 billion by year-end, with an annual growth rate of 8 percent. An ACNielsen report states that fewer than four out of 10 meals served include a home-cooked item, and one-quarter of all households dine in on takeout at least once per week. Franchises have been quick to jump on the trend.

"It's difficult for people in two-income families nowadays to come home and cook a meal and even to go out to get a meal," explains Paul Gooden, managing partner of the Steaks To Go franchise.

Marked for their convenience, HMR delivery franchises are striving to provide fast, hot and tasty meals for offices and households alike. While pizza still remains an HMR staple after all these years, many HMR franchises offer grilled entrees that typically include a salad, a baked potato and a roll with the purchase of a dinner. "We give customers an alternative to by offering a full of steak and chicken dinners that range from $9 to $17," says Gooden.

Don Harkleroad, president of Steak-Out Franchising Inc., has had great success with his more than 85 stores across the nation. "We're growing in total number of units opened, volumes per units opened and profitability," he says. "This business is riding an up trend, and HMR represents an increased opportunity for entrepreneurs." According to Harkleroad, the average Steak-Out franchise brings in roughly $778,000 in annual sales.

While some franchises include catering services along with their delivery and takeout systems, Off the Grill Franchising Inc. president Alan Thompson notes that 90 percent of Off the Grill units' sales are carryout or delivery. "This is all we do, so we do it very well," he says, contrasting Off the Grill with regular restaurants that offer takeout menus.

"People who want a prepared meal at home would much rather have us bring it to them than go through the inconvenience of driving to a store, standing in line, picking it up and then driving home again," adds Harkleroad. "We believe the delivery mechanism is far superior to the takeout approach." From the looks of it, consumers agree.


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