Is Franchising Your Bag?
Are you wondering what the hottest franchising trends are? Much of the recent success in that area is traceable to two demographic trends: Americans are getting older and feeling pressed for time. Doesn’t sound too bright, but it means booming business in franchising circles.
Now I am by no means a Franchise Guru. I’ve never owned one, worked for one, or even considered one and for good reasons.
First, when I started my publishing and publicity business I wasn’t flush financially enough to pay the “freight” on a franchise. Secondly, it seems too much like working for another corporate business to me. Things are done their way or no way, and you work for two – you and the piece the company takes. That doesn’t mean that it can’t be your cup of tea, because many entrepreneurs love franchises.
I’m not going to expound as a franchise expert, but rather I’ll give you the facts about the hottest ones to look at if you like franchises. Despite the status of the economy it seems the most stunning growth in franchises in 2004 has been in the senior-care segment. Seven senior-care companies ranked in the top 500 in Entrepreneur magazine have grown a total of 370 units in one year, and almost 39% in the past year.
Experts say that despite the large increases, this market hasn’t peaked yet. By 2010, 39 million Americans will be 65 or older, and that’s almost 20% of the North American population. About 30% of non-institutionalized seniors live alone, per the Dept. of Health and Human Services Administration on Aging. Many of them need extra help at home or companionship.
As the nation ages and boomers turn 60, this segment of the population will grow. “Elder care will replace child care as the number one social issue,” predicts Jeff Huber, vice president of Home Instead Senior Care – a franchise that grew from 356 to 448 units this past year.
The next hottest area is kids. Parents want their kids to have fun and be well-educated and will spend money to ensure this in good times and in bad. Children’s products and services segment of franchises have grown steadily over the year and become one of the top 5 overall categories in term of unit size in 2004.
What’s changed? Spending on children is now being fueled not only by baby-boomers, but by Generation X – a group that has $736 billion in spending power. Another change in the market in the past 25 years is the increase in dual-career families. According to some in the industry, this is an ideal time to enter the education sector of franchises for kids.
Kids’ fitness programs are also growing. Caryn Burnier, franchise sales director with Stretch-N-Grow International, says they have added 50 units last year. “We expect to see more children enrolled in fitness programs in the coming year,” says Jerry Perch, vice president of sales/marketing for the 92-unit Kinderdance International Inc. franchise.
Last, but not least, the tech industry is rebounding from its nose-dive in the past. This is because there is an increased dependence by people and businesses on their technology. People need advice on what to buy and what not to buy, and what is the proper solution to their particular need.
Computer Moms International Corp., a training and support provider, has seen a shift in its client base since it started 10 years ago. The greatest demand for services from the Computer Moms group has shifted to the business market, and the group added 30 franchises last year. The experts claim that the demand for quality full-service training and tech support is vast now and expected to become greater.
Following on the heels of those three areas are franchises in the area of Home Improvement, Fitness, Income Tax Preparation, Business Consulting, Specialty Ice Cream, and Coffee. So, if you’re in the market for a franchise type business pay heed to the up-and-coming hot leaders and let somebody else go for the 7-Elevens.