Franchise Trends Predicted for 2021
Let us explore franchising trends that have emerged in what will be recorded as one of the most difficult economic times.
1. Franchising creates opportunities for people to buy employment.
The current economy has forced plenty of people to seek alternative employment solutions. Some people may feel insecure in their current position or have changed their priorities in life. There has been an influx of new entrepreneurs in the market or people seeking to buy employment opportunities. Franchising offers an opportunity for individuals that want to invest in their future or build a successful and viable business.
2. Together we are stronger.
Franchisors, franchisees, and the community at large are realising the power of the collective by coming together and showing support for each other in difficult times. It is important to work together to ensure alignment, collaboration and ultimately growth for the entire business. This may well shape the future of business and new opportunities.
3. Smaller, cost-effective, recession proof franchise models.
Covid-19 has impacted various industries, businesses, and franchises. They are starting to futureproof and change their business models to ensure sustainability and long-term survival of the brand and for the franchisees. The current situation has brought on various new cost-effective opportunities. One should investigate industries and franchise models that will remain operational and sustainable regardless of the economic conditions.
4. Existing franchise resale opportunities are on the rise.
Franchising has proven resilient in tough times, however not all franchisees are willing or able to weather the storm and then franchise resales occur. When looking at buying a franchise resale you need to investigate the franchise performance in relation to other franchisees and forecast the potential prospects the business may hold. You are buying into a business that has already been set up, has a local presence and existing base from which to grow the business. Bear in mind buying an existing operation is not without risk and you need to carefully investigate the available opportunities before committing to a franchise partnership.
5. Multi-brand and Multi-store franchise ownership.
We are expecting to see a rise in multi brand franchisees due to entrepreneurs and franchisees diversifying their income streams, reducing their risk to protect and gear themselves against the economic downturn. Multi-store owners of the same brand are finding it easier to remain viable in the current conditions.
6. Going into survival mode.
Potential and existing franchisees need to get to know the current market, the opportunities and how it has been changing in order to adapt their business or select a viable franchise opportunity. One needs to do extensive research, be agile, alert, and adaptable in their business to ensure that the franchise is sustainable in the long term.
7. Franchisees will need to source alternative funding solutions.
Traditional funding solutions may not be accessible to all franchisees, this may be a result of financial performance and status, their risk profile and not being able to meet the funding requirements for funding approval. Sources of additional or alternative funding solutions may include investors, grants, venture capital, crowdfunding, etc.
8. Customer confidence will slowly return.
Customers will start frequenting businesses more and will increase their spending which will result in businesses being able to survive. However, not all customers are comfortable returning just yet, and franchises need to accommodate the needs of those customers by creating multiple channels for customers to reach them, this includes a physical and e-commerce channel.
9. Digital is progressing rapidly.
Businesses must evolve and accelerate online digitisation, as it is essential for survival and expected by customers. Customers want products and services on-demand, almost instantly. It is all about the experience, convenience and personalisation when offering solutions to customers, e.g., order and delivery, online bookings, contactless payment options, apps and websites, self-service and/or contactless portals.
10. Family partnerships are being formed.
Families are investigating buying franchise opportunities that they can grow and build a sustainable business for their current and future generations.