According to the Franchise 500 survey, four major buyer categories are spurring unit expansion in the franchise industry: second-career executives, young entrepreneurs, women and minorities.
As a result of the recession, many qualified employees and high-ranking business professionals have watched their companies downsize and their jobs get eliminated. Others have grown frustrated or tired of the corporate world and set out to find professional independence, an opportunity the franchising industry offers in spades. In fact, the survey found that 77 percent of surveyed franchisors reported second-career executives to be among their primary buyers today.
Former corporate leaders are highly valued applicants, possessing the knowledge to recognize the importance of and create a solid business structure. In addition, they are prepared to deal with the initial costs and time it starts to generate revenue.
In turn, former business professionals appreciate several aspects of the franchising business model. "There's no receivables, there's no real estate, there are few employees, it's a repeat business, very scalable, not subject to economic swings and there's not a lot of competition out there," David Louy, executive vice president of franchise sales at Aussie Pet Mobile, told the magazine. "People who have been in the corporate world for a period of time recognize these as things that have value."
Women franchisors are a growing population as well. The survey reported that 32 percent of franchisors noted women were primary buyers.
"There are more women who are economically independent and [who are] the primary income-earners in their households," explained John Reynolds, president of the International Franchise Association Educational Foundation. "And as a result, they are much more likely to be interested in starting and owning their own businesses."
John Dring, COO of Cartridge World, estimates that training sessions are now compromised of equal percentages of women and men, compared to the 70/30 male-to-female ration of only two years ago, the magazine writes. And many women hope this will continue to encourage new generations of entrepreneurs and franchisees.
"I have a daughter, and I feel like I'm [being] a positive role model and showing her that women can be strong and run organizations," said Karrie Holland, a Cartridge World franchisee since 2004.
There are numerous resources available to new franchisees, especially women and minorities. The International Franchise Association provides special seminars and franchising for these populations.
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