 There’s no denying that the world of franchising has changed—some (those still grieving the lending heyday of 2006-2007, no doubt) say for the worse. But not all of the changes have been disappointing ones. The entrepreneurial spirit abounds and is acting as the catalyst for exciting changes and innovations in the franchising field. Here are some of the more optimistic highlights to watch for:
Since the beginning of the recession in 2008, banks, having learned the consequences of lending to just anyone with a driver’s license and an account, have been tightening their belts on all types of loans, including small business loans. This is not good news for individuals looking to buy a franchise since most everyone will have to take out some sort of loan for start-up costs. Although we may never see the days of loose lending again (and for good reason), banks do appear to be making more loans these days, and this could be good news for prospective franchise owners with solid credit scores. Determined franchisees are finding ways to finance their dreams including taking out home equity loans and even tapping their retirement accounts. Some strong franchisors are even offering direct lending to prospective franchisees in hopes of growing their business despite the current economic climate.
Of the top ten fastest growing franchises in 2011, as reported by Business Insider, seven of them are cleaning businesses that provide residential and/or industrial cleaning services, namely Stratus Building Solutions, Jan-Pro Cleaning Systems, CleanNet USA, Anago Cleaning Systems, Vanguard Cleaning Systems, Bonus Building Care, and System4. The boom in this particular niche is good news for potential franchisees looking for a cheap way to start their own business. The start-up costs vary of course, but most come in well below the $100,000 mark and some require only a few thousand dollars to get the business up and running, or sweeping as it were.
Franchisees aren’t the only ones suffering from the recession. These days, franchisors have to compete more than ever before to attract potential owners—not to mention customers. To stay competitive, many of them are offering more attractive terms, better business practices, and higher-quality products. What does this mean for you—the potential franchisee? A better chance of making it big in the world of franchising, that’s what.
The recession hit the real estate market pretty hard, and that’s not good news, but there is a silver lining for potential franchisees. With the market down on its luck, there’s a better chance that you’ll be able to snag a great location for a much lower price. And as the real-estate adage goes, it really is all about location, location, location!
More and more women are getting into the world of franchising, and 2011 could see the biggest boom yet amongst leading ladies. There are a variety of appealing factors that lure women into franchising including the economic factor. Many housewives and mothers are feeling the urge to contribute to the family budget, and what better way to do it than by starting a franchise, especially one that is flexible enough to factor in childcare and other family responsibilities? Women are generally quite successful in the franchising world because they have the support of the franchisor to make the more rational decisions concerning the business and they also have the charm and social skills to ensure customer satisfaction. Popular franchising fields for women are the salon industry, senior and child care, as well as educational services such as tutoring and testing centers. Look for more women to get into the professional cleaning business in 2011 since this is also a hot trend in the world of franchising.
ConclusionIf your New Year’s resolution was to give up your hopes of opening a small business franchise in exchange for tightening your belt to acclimate to the new, dreary economic climate, think again. There are still opportunities available, and not all of the changes in the franchising world in 2011 are bad. Some of them can be used to your advantage, and could potentially result in the successful business you’ve always dreamed about.
ReferencesThree Franchise Trends to Watch in 2011. Entrepreneur. Retrieved from
http://www.entrepreneur.com/article/217792#. Top-Ten Fastest Growing Franchises. Entrepreneur. Retrieved from
http://www.entrepreneur.com/slideshow/217981. Trends in Franchising. Franchise Prospector. Retrieved from
http://www.franchiseprospector.com/franchising-trends/. |
