UPDATED March 21, 2017
One restaurant franchisee recently told Eat IGH that a business owner checked out some vacant retail property in IGH to consider opening a new restaurant in the City of IGH.
While the business owner liked the property and location, he felt that he could generate more business in a different location and city. Why? More traffic, larger population. More people in the city over lunch hour. All factors business owners evaluate before opening a business – especially a restaurant.
And those are the primary reasons why popular chain or fast food restaurants/businesses won’t come to Inver Grove Heights. To think a business like Kohl’s or Texas Roadhouse, or Chipotle, or Golden Corral, among others, would open in IGH because they are in neighboring cities and we should have the same businesses as other cities is just not realistic.
The reality is, a business owner has to want to open a business in IGH and they have to believe they can make a go of it over other cities.
If the owner of that business can make more money or sees a better opportunity in another city, then they will open in that city.
Case in point: There is a Dunkin Donuts that may soon open in West Saint Paul. People now wonder why a Dunkin Donuts won’t open in IGH. Why we want average coffee and donuts is beyond us – we can get better at Kwik Trip, Holiday, or SuperAmerica. But that’s another story.
But from a business perspective, if you were the owner or franchisee would you rather open up a business on Robert Street, which is bustling with activity day and night? Or Cahill Avenue, which is low key and not very busy?
It’s simple economics. The reason fast food restaurants and chain restaurants won’t come to Inver Grove Heights is because they use economic factors, performance indicators, population numbers and restaurant industry software that projects sales, growth and success rate. And when those line up, a city with more traffic or a larger population, is going to be more attractive to that business or business owner.
As stated below, the city of Inver Grove Heights isn’t competing against West Saint Paul, Eagan, Woodbury or South Saint Paul. They are competing against every other city in the Metro. Just because WSP, Woodbury and Eagan have a Chipotle doesn’t mean IGH should get one. Chipotle would have to see a reason they could succeed financially to open in IGH. They don’t, so they won’t open in IGH.
These businesses and business owners are looking for an edge and the right location to make money. There’s more traffic in Woodbury. So a Red Savoy pizza recently opened up in Woodbury. The reason? That franchise owner believes that the higher population and more traffic will lead to increased business opportunities.
And that person is right.
Restaurants and retail shops are opened to make money. They open in areas where they can make the most money. So if a franchisee who is investing in many cases, six figures into a restaurant can make more money in another city, then they are going to open in that city.
Economics 101 – available at Inver Hills Community College.
And that’s okay. We at Eat IGH like diverse dining options. It’s great when something fun, new and unique comes to town – like the new sushi restaurant in Argenta Hills. We like that B52 Burgers and Brew is adding a rooftop patio.
We like the new authentic mexican restaurants that have opened recently.
But we also like how we can get in and out of the city quickly. We like how you don’t have to wait at stop signs or stop lights forever, or fight traffic at all times of the day. We like how you can get a seat at any restaurant at any time of the day, without waiting 15-30 minutes. If you want that, and you want more restaurant options, you can get that in Woodbury, Eagan, Bloomington and other bigger, busier suburbs.
But because of the population, daytime traffic, and the fact that business owners are out to make money, those are the reasons popular restaurants and chains won’t come to Inver Grove Heights.
And that’s fine with us. Sure, we’d like a few more unique options. But we do have some pretty unique options already. Minus the traffic and headaches that cities with larger populations face. That’s not so bad, is it?
ORIGINALLY PUBLISHED JULY 15, 2015
Why won’t Chipotle come to Inver Grove Heights? When are we going to get a Taco Bell? Will Panera Bread come to Inver Grove Heights? Will Wendy’s open in Inver Grove Heights? What about Red Lobster or Olive Garden? Is it really true that Buffalo Wild Wings wanted to go in the recently vacated Old World Pizza location, but was turned down by the city?
Those are among the many questions, and rumors Inver Grove Heights residents have and the type of issues and topics that will be covered on EatIGH.com. The reality is, there are specific business reasons why each of these restaurants aren’t in Inver Grove Heights.
Chipotle is a hot topic. Repeated calls, emails and attempts to reach Chipotle corporate for comment about why they have not come to Inver Grove Heights (and probably never will) have not been returned (but we have not given up yet). The Chipotle corporate web site discusses what a city must have for a Chipotle restaurant to come to a city and IGH does not seem to be a fit (more detailed report later). One thing to clear up: Chipotle is not a franchise, so the comments related to franchises in this article don’t fit, but it’s mentioned because everyone wants a chipotle (except the owners of TC Taco that is).
To help find out just why some restaurants won’t come to Inver Grove Heights and to help residents understand why we are stuck with two McDonald’s and two Subways, and a lack of other popular restaurants such as those mentioned above, we reached out to Mike Welch, President of FranNet Minnesota, a Minnesota franchise consulting firm. Welch’s expertise goes beyond restaurant franchises, but for the sake of this interview, the focus was on why restaurants won’t come to Inver Grove Heights.
“Franchisors need several characteristics to be present in order to consider opening a franchise in any location,” says Welch.
Welch outlines five top factors that must need to be present for a franchise to open:
- They have to have a great franchise candidate in the area. They can’t open franchise locations where there are no franchisees interested.
- Demographic profiles within a certain radius that match those of their top locations. Franchises use software (Buxton, MapPoint) to analyze the demographics of a certain area and if the city/location is not a match, they won’t open there.
- Available Class A real estate.
- Traffic counts need to meet or exceed standards.
- Aggressive landlords that are willing to put together attractive terms.
Now here is where it hurts when it comes to Inver Grove Heights:
“From a retail standpoint, Inver Grove Heights is viewed as an old community,” says Welch.
Combine that with a lack of new development, and it’s not the mix needed to entice restaurants, retail or other small businesses to come to the city.
Most people compare IGH to other surrounding cities, like Eagan and Woodbury – two bustling, growing suburbs with a thriving restaurant and retail community, and even West Saint Paul, home to Robert Street, the king of fast food restaurants, auto parts stores and a poorly planned redevelopment project.
That’s just not the right comparison to make.
“Remember, when these companies are considering expansion, IGH isn’t just competing with other Twin Cities communities, its competing with every other city in the USA,” says Welch.
One Vice President of Franchise Development for a major franchisor and he said that “IGH has never even come up in conversation.”
This consultant referenced a city like Brooklyn Park as the example of what attracts the attention of franchisors. Brooklyn Park is the sixth largest city in the state of Minnesota with a population of just under 80,000. The population of IGH hovers around 35,000. This franchisor executive referenced how in 2004 Brookdale Center began to lose anchor stores and the retail environment was in steady decline until they built Shingle Creek Parkway. The city invested a lot of money in infrastructure and it became a very attractive location for businesses, this executive pointed out.
Jennifer Gale, President of the River Heights Chamber of Commerce said this: “Chain restaurants and stores use groups who produce economic indicator matrixes when they do national franchise searches and IGH is not going to be on the list for many reasons including, population, daytime employment and financial incentives.”
It’s been a long, long time since Inver Grove Heights’ once thriving shopping mall – Village Square – lost anchor tenants (we all know Snyder’s, Coast to Coast, Ben Franklin, Home Video, The Village Shoppe, Cheshyre Fish & Pets and Red Owl are long gone), so that redevelopment is obviously out. The only thing that could provide a similar developmental boost relates to the proposed 494/Argenta Trail revamp and that’s about a decade away.
What this tells us, unfortunately is, don’t look for your favorite franchise/chain restaurant to come to Inver Grove Heights anytime soon. Look for more in-depth analysis and insight on all these restaurants and more over time. If you have a specific question or want info on a specific restaurant, email firstname.lastname@example.org and we will look at it through an article or as part of a mailbag.
These are all reasons IGH remains a great place to live, but an average place to eat. For now, at least.