Current economic conditions are good for franchised businesses and the outlook for the year ahead is very optimistic, International Franchise Association franchisor-members confirmed in a recent Web-based survey. More than two-thirds (68 percent) held a favorable view for their specific business, half calling current conditions “very good” while a similar share said things were “somewhat good.” For franchising overall, 70 percent were positive about the current health of the sector: nearly 27 percent gave the nod to “very good,” while 43 percent were slightly less enthusiastic, noting “somewhat good.”
Future Business Conditions
Those surveyed were also upbeat about future business conditions. More than three-fourths (77 percent) said they were optimistic about what lies ahead for their specific business: nearly 46 percent marking “very good,” nearly 32 percent saying “somewhat good.” Viewing the overall outlook for franchising, 72 percent of these franchise system leaders gave a thumbs-up to future business conditions: the “very good” group at nearly 31 percent; “somewhat good” share at 41 percent.
Asked to share their outlook for the year ahead in sales and unit growth, nearly three-fourths (74) percent) said they believe their system-wide gross sales will increase: nearly half (48 percent) expect increases of 11 percent or more while more than one-fourth foresee 6 percent to 10 percent improvements.
Sales of franchised units will also be boosted, 76 percent believe. Nearly half (46 percent) expect 11 percent or more growth while almost 30 percent predict 6 percent to 10 percent increases.
Franchisors also expect to create jobs in the coming year: 72 percent report they plan to increase employment within the next 12 months.
The survey was conducted via e-mail to members of the association in December and January. Highlights of the “Business Outlook and Compensation Survey” were presented during the IFA annual convention Feb. 25-28 in Palm Springs.
A Benchmarking Task Force, chaired by Meineke Car Care Centers CEO Kenneth Walker, is exploring ways to develop metrics that franchisors can use to compare performance with their peers and boost overall productivity.
With the economic downturn being a global problem there is of course going to be the inevitable slump but the global business infrastructure will stay intact and franchising is likely to boom as always especially in a modern future where people prefer to work for themselves and not as part of a larger organisation with little benefits. Despite the drawbacks of buying and owning a franchise, the main drawbacks being that you do not fully own the company, it still allows the freedom for you to work to your own schedule and to your own limits and prospects.
Should you wish to learn more about franchising and want to dig deeper before you invest the internet is a great research medium for the good the bad and of course the ugly. A few simply google searches can bring you up a wealth of information which will keep you reading for weeks and weeks. Take it all in your stride and research every detail before ever committing to buying a franchise. This way you have a far higher chance of success in the franchise marketplace!
Matthew Anderson is the founder of The Franchise Shop website which specialises in franchises available