A recent CNBC news article states that the franchising industry is expected to grow at 1.6 percent, which will produce approximately 11,500 new establishments. Franchise employment increased 3.5 percent in 2016 and is forecasted to grow at 3.3 percent in 2017. Total franchise output increased 5.8 percent in 2016, so it will likely grow at least 5.3 percent in 2017.
Recent Events and Future Forecasts
The recent presidential election has inspired hope among entrepreneurs and small business owners that they may enjoy future tax cuts, easier profit repatriation and better roll back regulations. However, the new administration’s potential policy changes may positively or negatively impact the business world. For example, a more relaxed regulatory environment will help small businesses tackle taxes and increase revenue, but aggressive immigration policies could threaten employment growth and stability in all sectors. Heightened consumer optimism is linked to stronger employment, disposable income and household net worth levels. Industry improvements include supply chain streamlining, energy-sector investing and SBA financial support for small business owners.
Geographic and Industry Trends
Franchise experts estimate that the states in the South and West will experience the most growth in franchise output and employment because of general economic expansion and business development. Both of these regions continue to benefit from stronger flows of domestic migration. Some of the states that offer the strongest franchise growth include Utah, Arizona, Nevada, Florida and Colorado. Some of the most popular franchise chain opportunities can be found in the personal, business and retail product service sectors as well as the quick- and full-service restaurant segments. Geographic areas experiencing population and personal income increases are expected to drive franchise related growth through supporting tourism, lodging and restaurant businesses.
Entrepreneurs who want to start their own business can take advantage of consumer trends to benefit from starting a franchise. For example, consumers are demanding that things get done their way. They want customized orders, exact specifications and personal deliveries. There are more franchise opportunities that encourage and empower consumers to customize your their and services. Related to this, on-demand services are becoming so popular because consumers want to control their entertainment experiences. Schools, parents, companies and policy makers are focusing on healthier living and choices, so there are new franchise opportunities related to fitness, well-being and personal care. Popular trends include nutritional services, healthier fast food and exercise services for seniors.
Many global corporations continue to dominate their markets, but technology innovation, industry developments and changing consumer preferences are driving corporate objectives and directions. For example, consumers and the public now expect sustainability, better resource management and green business practices. Eco-friendly attitudes must be established through investing in services and products that save the environment. To illustrate, carbon footprinting and global warming concerns are causing serious marketing and public relations concerns in certain industries. As a result, these corporations are looking to small businesses that offer consulting services and certifications.
Corporations with established and growing brands are looking for new business and franchising opportunities. Multi-brand franchising is the key to maintaining market positions in tough economic and competitive environments. Now, more and more companies with famous brands are giving franchises limited opportunities to represent their previously inaccessible products. This strategy is favored among corporate conglomerates that seek to streamline efficiency and operations within their investment groups. This is popular among service brands with growing consumer demands for mass customization. For example, fast food restaurants are implementing touch screen menus with the ability to choose specific buns, toppings and burger sizes.
Some traditional business trends never change, so this will continue to promote franchising development and expansion. Some of the most stable, low-risk and recession-proof businesses include education, auto repair, child care, real estate, computer services and DIY home renovation. Sign up for free information and downloads about the staffing industry and the Nextaff staffing franchise here or click below for more information.