Franchise Journal December 2021

Page 34

BUSINESS ADVICE

The Franchise Landscape by Jon Ostenson, Consultant, The Franchise Consulting Company

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n the heels of Covid lockdowns and quarantine, we are seeing unprecedented levels of interest in business ownership with much of this interest coming through the avenue of franchising. Year-to-date, our client placements have increased well over 50% vs. 2020, which despite Covid, saw similar levels of expansion over 2019. The vast majority of these placements have come in industries outside of food and lodging, which we will touch on later. So who are these new franchise owners? More than

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ever before they represent a substantial cross section of Baby Boomers, Generation X, and Millennials. As outlined throughout media headlines, Covid has caused many across the spectrum to reflect on the path they are on. For many, this reflection has led to the decision point that now is the time to scratch their entrepreneurial itch. In some cases, these newly minted business owners are jumping in with both feet, leaving their corporate roles and taking on the reins of owner-operator of a new enterprise. In other instances, they are taking a step into

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entrepreneurship via a ‘semi absentee’ model with the plan to put in 10-15 hours a week. The latter group is seeing business ownership as an ‘asset class’. Business ownership provides tax advantages that many other investments do not. With the stock market at an all time high, low interest rates, and only so many good real estate deals available, investors are looking at alternative options for parking their record levels of sidelined cash. Why are so many opting for franchising over a traditional ‘start up’? They recognize that franchising provides them with: