Best Franchise
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The selection of different franchises to
buy will continue to grow in the future.

As we face the new century and try to predict certain trends in self employment, it seems certain that franchising, as means of business ownership, will continue to grow at a healthy pace. This will be true domestically and, especially, outside of the United States. Potential franchise business owners will be generated in several ways:

• Corporations will continue to make strategic and profit-oriented personnel reduction decisions, thus generating more outplacement candidates.

• Women, currently in the work force or re-entering the work force, will increasingly seek ways to own their own business.

• Stock-inflated savings and retirement plans will provide the financial means to individuals who want to purchase their own business.

• Business ownership will provide an attractive investment alternative to the stock market as the growth of stock equity appreciation slows during the next several years.

The selection of franchises to purchase will continue to grow as young companies continue to find franchise formation an attractive means of business expansion.

If you are a potential franchise owner, you will need to ask serious questions before deciding which franchise to buy. One of the most important questions will be, "Which franchises will participate in important and/or new trends that will insure long term growth well into the next century?" One of the keys for any prospective franchise owner will be, of course, to identify those franchise companies.

Fads are temporary while trends produce long term growth...

At the outset, it is important to note several things. The first is that trends should not be confused with fads. Fads are temporary while trends produce long term growth for participating companies.

Secondly, franchises do not, as a rule, create trends. For the most part, franchises are created after the fact and simply participate in the growth of a trend by developing a business system that performs a service or sells a product in a better, more efficient manner than competitors.

Finally, and most importantly, the decision to buy a franchise should not be based simply on whether or not it will become part of a "hot" trend. Identifying trends is important, but it is even more important for you, the franchise buyer, to identify the business that meets your financial and career goals and that you will enjoy and operate with competency-in short, to identify the franchise business that is right for you.

New and developing trends will cut across many industries as franchise business ownership continues to grow. We will see growth of new trends and the continued growth of existing trends in the food, automotive and retail sectors, and perhaps even more rapid growth in what could be called the personal and business service sectors.

FOOD IS HOT!

The food industry is the largest in franchising and will continue to grow as our population grows and our busier lives demand the convenience of eating out or eating ready to cook, prepackaged foods as home meal replacements. A recent survey by Restaurants and Institutions showed that 44 % of all Americans eat at fast food restaurants at least once per week. The current trend toward co-branding and consolidation of ownership of the major fast food restaurants will continue.

However, another predominant trend in the food industry is toward healthier fare delivered with the convenience of fast food and takeout and delivery franchises. Franchise companies that participate in this growing trend may offer more practical franchise ownership opportunities for new franchisees. These businesses often require less start-up capital and fewer employees, parameters for business ownership we often see when dealing with prospective franchise buyers.

The concept of co-branding (or co-habitating in one
location) will continue to increase in popularity. . .

Franchises that deliver prepared, high quality dinners to homes (steak, chicken and salads, for example) and franchises that provide healthy fruit juice drinks, smoothies and related health food fare are franchises that will benefit from the health and convenience trends in the food industry.

AUTOMOTIVE INDUSTRY-LARGE AND GROWING

Like the food industry, the automotive industry is very large and continues to grow at a steady pace. Today, more Americans are driving farther to work and using their automobiles more frequently to participate in various family activities. Cars are more expensive (on average, $22,000) and people are driving them longer than ever before (an average of nine years, according to one study). This trend continues to create more opportunity for franchise companies that sell products and services into the automotive aftermarket.

While franchises offering general car care will continue to grow and be successful, companies that sell into niche markets will generate the higher gross profits and grow at strong rates well into the millennium. One excellent example of a niche market franchise is the transmission service business. Transmission service represents a mature sector of the automotive industry and is once again enjoying extraordinary growth created by the longevity of automobile ownership and an increase in the sales of newer vehicles with front wheel drive.

Another niche market concept now offers a large selection of custom wheels and hubcaps at low prices, items that are normally purchased at car dealerships or automotive junkyards.

The concept of co-branding (or co-habitating in one locations) will continue to increase in popularity as complementary automotive franchises band together under one roof to create an "automall" service concept.

RETAIL WILL GROW

The retail industry will produce its share of franchise opportunities that can expect excellent growth into the next millennium. A growing retail trend we see is toward selling products with excellent perceived value at discounted prices, for example, stores that sell both recycled and new products. Currently, retail franchises exist that buy and resell computers and peripherals, sporting goods, video games and CDs. The newest franchise in this sector now sells new and used household and commercial tools.

The number of stores that sell one-price items and that operate in retail "outlet" malls will also continue to grow as the consumer searches for value. The rapid growth in sales of anything "child related" will produce retail opportunities for children's clothes and toys, especially educational toys.

One important and notable trend we see in the automotive and retail industries relates more to the business owners than the businesses themselves. Many successful franchise owners today are more sales and marketing oriented than in the past and realize the value of establishing business referral contacts, and, in some cases, hiring sales people.

PERSONAL SERVICE INDUSTRY GROWING

The personal service industry is growing by leaps and bounds. Exciting trends are being created by changing demographics and the markets created by dual-income and single parent households, aging baby boomers and retirees. Maid services, home health care services, home repairs, teaching and/or caring for children-franchises that enhance lifestyles and create convenience by providing these services-are among the fastest-growing companies.

Take-out fast food franchises often
require less capital to get started.

As with the retail industry, children provide a big business opportunity for new franchises. One very successful franchise now teaches science to preschool and school children. Others provide computer training and enrichment programs to children.

The corporate business world has changed drastically over the last 10 years. Companies are not only downsizing for strategic and cost cutting reasons, they are outsourcing many services that used to be done in-house. Consulting, sales and management training, job training services are some of the services that many larger corporations increasingly depend on others to provide.

--Michael Hall is President of Franchise Network (800-FRAN-NET)