NEW BUSINESS
HOW TECHNOLOGY & CUSTOMERS ARE SHAPING THE FRANCHISE MODEL by Rick Morgin, Consultant, The Franchise Consulting Company
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he franchise landscape is changing quickly. New business opportunities are emerging within traditional industries, creating what we refer to as disruptions. This is good news for both sides of the franchise model. Companies ready for expansion can more easily consider franchising, and entrepreneurs eager to own a business can find a greater range of opportunities. What is causing this shift, this disruption? Simply put it’s due to advances in science and technology. Advances in science and technology are allowing
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businesses to develop innovative new products, attract a greater number of customers, and provide increased convenience to those customers. What this means is traditional offerings are being broken down into highly convenient and customized products and services consumers can purchase with the touch of a button. The fitness industry is one example where we see disruption and opportunity. If you think about traditional fitness service offerings, Big Box gyms come to mind. If we apply advanced technology, improved customer access and greater convenience
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to this industry, we find many new offerings. For example, specialized fitness concepts have developed a segment of the fitness industry known as boutique fitness. Specializing in a specific fitness category such as Yoga, Indoor cycling, Rowing, or Stretch and building a studio in an aesthetically pleasing, smaller and more personable footprint, boutique fitness has grown 450% year over year since 2010. Boutique fitness concepts create an intimate and almost tribe like following. This loyal customer following develops because the franchises operating in this space empower their managers, trainers,