For many people, the end of summer signifies a time to assess whether they’re happy in their current occupation, leading them to consider whether they’re willing to take on a new venture. For those who enjoy working for themselves, now is a great time to start a new business, and a franchise can help cut down on the work involved in getting that new business started. Since franchises use tried-and-true business models and well-established brand names, the process of starting a business and beginning to make money is streamlined.
A tax preparation services franchise is no exception because it also offers an established model for success using a trusted brand name. In addition, tax preparation is a smart bet: most people are required to pay taxes, year after year, for the majority of their lives. Because we’re required to pay taxes every year, tax preparation tends to be recession resistant. So if you’re wondering if now is a good time to invest in a tax preparation services franchise, here’s helpful information about the tax industry’s growth outlook.
The Franchise Industry in General
In their economic outlook for 2018, the International Franchise Association Franchise Education and Research Foundation reported growth for franchises across the board in the United States. The number of open franchises grew 1.6 percent in 2017 and is expected to increase an additional 1.9 percent in 2018. In addition, the IFA found that employment growth within franchises increased at a rate higher than businesses in general. Based on their research, franchise employment rose 3.1 percent in 2017 and is expected to increase to 3.7 percent growth in 2018, continuing to outpace economy-wide employment growth of 1.7 percent in 2017 and a forecasted growth of 1.8 percent in 2018.
The Tax Preparation Services Industry
According to IBISWorld.com, the tax preparation services industry has grown consistently between 2013 and 2018, including a projected annual growth of 4.6 percent, bringing in $10.4 billion in revenue and employing more than 292,000 people in 121,000 locations in 2018 alone. Based on such solid, consistent performance, the tax preparation industry has potential for growth over the next several years.
Why is Tax Preparation So Reliable?
In 2019, the IRS predicts more than 255 million people will file tax returns. Although Tax Reform is trying to make taxes easier to file, the new tax laws can be difficult to understand and follow. Therefore, even people with a relatively straightforward income scenario can benefit from using a tax preparer so that they don’t miss out on new deductions and credits. And when it comes to reporting income earned from sources other than as an employee at a business or corporation, navigating the forms can be a nightmare for many people.
Statistics show that people realize this is true: in 2018, 57 percent of all taxpayers who e-filed used a tax preparation professional, which is an increase of 648,000 potential new customers over the previous year. Taxpayers are flocking to tax services franchises to ensure they get the biggest refund they qualify for or pay the least amount in taxes possible.
If you’re looking for a solid franchise option, consider the tax services industry. With millions of potential customers needing tax services at least once a year, the tax industry is one of the most profitable for small business owners, so you’re more likely to succeed than many other franchise options.