Franchise Opportunities Abound
A new franchise outlet opens somewhere nationwide every eight minutes, says a survey by the International Franchise Association (IFA). With over 5,000 franchised businesses, covering nearly every conceivable industry, opportunities have grown tremendously, especially for those willing to take the risk.
"I chose franchising because it’s more mapped out," said Bernice Duran, owner of a Worldwide Refinishing franchise in El Paso, Texas. "I also like the name recognition associated with a franchise."
Unfortunately, when people think of franchises, they automatically think fast food. "Fast-food is extremely competitive, " said Erik Wulff, a partner with Washington, DC, law firm Hogan & Hartson. "Owners have to rely on a fine-tuned, workable concept in order to get a good return on their investment."
What’s so attractive about franchises? Low entrance fees, backing of a large chain’s experience, marketing and know-how are top attractions. Ordinarily, buying a franchise is a safer bet than going into business alone since only 20 percent of franchises fail in the first five years vs. 50 percent of all other firms.
Which franchise trends will bring long-term success? Franchises selling ice cream, frozen yogurt, ices and soft serve are popular. Juice bars do well in regions with affluent consumers and a warm climate. A sister trend to juice bars--wraps--is also growing in popularity as consumers continue to crave healthier alternatives to fast food.
Beyond food, there are day care centers, both for children and adults. According to the National Adult Day Services Association, over 4,000 adult day service centers operate nationwide. Businesses include everything from home health-care services to centers that specialize in caring for seniors with Alzheimer’s disease. Job training franchises are also high on the list. The U.S. Bureau of Labor Statistics expects job training to grow 43 percent in the next six years.
Fitness franchises range from the typical gym-type fitness club to individual sports like martial arts and family-oriented activities such as children’s tennis instruction. And don’t forget stores like GNC selling the nutritional supplements these fitness afficionados consume.
Other unique franchise opportunities include living assistance service to caregivers of ailing senior citizens living at home. Or weight management, chriopractic servcies and more. There are specialized staffing franchises, as well as those that blend education with fun, ranging from baseball camps to Victorian tea parties. As corporations continue to restructure, they’re outsourcing services to franchises dealing in accounting, payroll, and human resources. And there’s also recreation and entertainment franchises like racquetball, restaurants with video games, and RV rentals. But the most explosive group is home-based franchises--maid services, carpet and upholstery cleaning, home remodeling, and HVAC repair services.
Duran chose Worldwide Refinishing, one such franchise. "Interior decoration and refinishing as an alternative to replacement are big money makers," she said. "I was able to start out small in my home and expand to a warehouse/workshop."
But potential franchisees should watch out for franchises that can’t generate enough revenue or are in areas of heavy competition.
"Franchising isn’t a foolproof system for success," said Richard-Abraham Reign, spokesperson for the U.S. Hispanic Chamber of Commerce. ‘Many franchisees often go into business with too little money to survive the start-up phase and fall victim to franchisers who promise support but don’t deliver."
Lorenzo Lopez , owner of a 7-Eleven franchise in Long Beach, California, advises working in the same business as the franchise. "It’s easy when you know the system," he said. He chose 7-Eleven, long a friend to the Latino community because he had been working for them for 11 years, working his way up from store clerk to manager. "When a corporate store became available, I applied for the franchise," he added. "It’s a different life for me." He’s currently working to open a second store.
How can potential franchisees find these opportunities? Connecting with an experienced broker or advisor who can help narrow the field to your uniquie background, skills, investment level and goals is one of the best places to starat. There’s so much information on franchising, including much of what franchisers will tell you and some of what they won't, it can be overwhelming.