Franchising where are the emerging opportunities?

Changing conditions, both economically and socially, create new opportunities. Of course, changing conditions also mean some previously stable sections of the economy lose their value and even their viability.

In this article, I will examine how these changes shape our future as consumers and therefore impact on the fall and rise of new small business opportunities. And of course, small business opportunities includes franchise opportunities.

Retailing And Home Delivery

Let’s start with perhaps the most obvious example – one that is most visible every time we go out shopping. For decades, when people needed or wanted to buy something, they went out to a shopping centre, browsed the stores and bought over the counter. But changes to this entrenched behaviour started when businesses of all kinds went online. Traditional shop windows gave way to online stores and merchandise on shelves became a digital catalogue on a website, with purchases made in a shopping cart with a credit card and the goods delivered the next day via a courier or the post. The result: retail shops became less important and so less viable for their proprietors.

By the time the pandemic hit, this trend accelerated rapidly to the point where retail shops were becoming no longer relevant. In many cases, traditional shops were actually a financial burden, with high rental and staffing costs and very few walk-in customers. Shopping had become an online activity where customers used their laptops and smart phone to buy almost everything. Postpandemic, and things have not returned to ‘normal’ and in any shopping centre or high street, there are empty shops for lease and “Staff wanted” signs.

For retailers, including franchise chains, the shop-front model is fundamentally changing. As a result, retail franchises are very difficult to establish and make viable and established shopfront franchises are very difficult to on-sell.

So, how does this trend impact on franchising and where are the opportunities? Enough said about premises-based retailing. The opportunities lie in the emerging area of home and business delivery of purchased goods direct from warehouse to customer’s doorstep. That is, mobile delivery services that deliver parcels direct to customers.

The obvious example of this is Amazon, but we see it everywhere. Home delivery services now include everything from pre-cooked meals, to clothing, to office supplies, to firewood – yes, even firewood, delivered in wheelie bins! You name it, you can buy it online and someone, often a franchisee, will deliver it to you in a van the next day.

Trades And Building Services

Have you tried to book a tradesman recently? Someone to do some renovations, or fix up some storm damage? Almost impossible!

So, where are all the tradies? We can put some of this labour shortage down to stalled immigration or the desire to quit the rat race and live a better life. But this does not answer the real question why trade services are so hard to find.

In my opinion, it’s simply a question of supply and demand. The ‘supply’ of tradespeople hasn’t really changed that much over the past few years, but the demand for their services and skills has skyrocketed.

There are several reasons for this. Firstly, we’ve had a surge of disaster recovery with floods, fires and massive damage to personal property and infrastructure, and tradespeople are booked solid.

Then there’s the continuing housing boom. Despite a slowing of our population growth, there’s a huge amount of internal migration; that is, people moving around Australia. This can be seen in the sea/tree change movement throughout the pandemic. Try buying or renting a house in regional Australia – there’s often nothing available. And even in our major cities, new outer suburban housing estates continue to soak up every available tradesperson and stock of materials. Herein lies the emerging opportunity for enterprising franchise companies. Many of these trades people are working as either employees of large firms or as sub-contractors and many of them would just love to quit the boss and go out on their own. A carefully structured trades services company offering a mix of “Work for yourself” franchises combined with “We find you the work” will inevitably attract a huge number of wellqualified prospective franchisees.

And with no shortage of available customer work, it’s a win-win for all involved – the franchise company, its franchisees and the frustrated customer. Trades services is a perfect example of how changing conditions create opportunities that are ideal for franchising.

in-home care

The third example I will give is the rapidly expanding sector of caring for people in need. We’ve all seen media reports about failures by institutions, governments and service providers to meet quality care standards and even fill basic demand for in-home or facility care for people in aged care, or with other types of personal needs due to a variety of factors, such as age, disability or social disadvantage.

Without delving here into the pro’s and con’s of government action and reaction, this situation lends itself to franchising for enterprising businesses that adopt a strategy that serves the needs of all parties. Those parties being members of our communities in need of assistance and care, the staff who provide the services and the government agencies responsible for overseeing proper service delivery and good governance.

To put the opportunity into perspective, let’s look at this as a ‘growth market’. Australia’s population is aging. In 2000, the percentage of Australians over 65 years was 12.4%. By 2030 (just 7 years away), our citizens over 65 years of age will represent 17.8% of our population. In number terms, there were 4.2 million Australians 65 years or older at 30 June 2020.

As our senior members of society age, they increasingly are in need of care, assistance and support. This comes in many forms; medical services, help with personal, social or mobility needs and simple things like inhome help with meal preparation, cleaning and even just social connection.

Government agencies are typically very bad at delivering these services – they are just not set up for this. But private enterprise usually is or can be good. Again, it’s a question of providing incentive and reward in the right place at the right time.

A service provider relying on employee labour at low rates of pay and poor working conditions is just compounding the problem. But a service provider, especially when structured as a franchised group and offering self-employment opportunities to trained and incentivised franchisees will find a ready and expanding market for high quality service in all forms of personal care. Plus, when such a business model is able to access government programs like NDIS or other seniors assistance programs, then it can easily become a viable long-term business model in which all participants are beneficiaries.

Conclusion

In each of the examples I’ve elaborated in this article, the underlying theme is:

• The past is never a guide to opportunities in the future.

• Disfunction and disruption create new opportunities for those who go looking.

• Incentivisation such as giving workers something better than they can obtain as an employee always provides a pool of people willing to work hard to build something for themselves.

• Franchising is the ideal vehicle for each of these factors in a changing economy and society.

Come on franchise entrepreneurs, the door is open. It just needs you to start shaking things up. For those who see opportunity in adversity, the future can be very bright indeed! v