The International Franchise Association comes out with its Franchise Business Outlook every year. The aim is to give an early indication of how well franchising in general and particular franchise industries are going to fare in the larger economy due to factors like national growth, consumer spending tendencies, and total employment.
The International Franchise Association assembles hundreds of economists and takes into account over 150 individual industries to give an accurate aggregate projection of franchising’s performance in the year ahead.
All of this information is pooled and disseminated so that folks in the franchise industry, related businesses, and even the government know what to expect.
Franchise business growth doesn’t occur in a vacuum, and the economists working for the International Franchise Association are quick to point that out. They note that while the dollar is strong—it is the currency to which all others are compared on foreign exchange markets—the overarching U.S. economy has struggled in recent years. One way to get in on this growing industry is to invest in a Transworld Business Advisors franchise where you can help franchisors develop, buy, and sell franchises. With this industry getting larger each year, why don’t you get a piece of the pie!
Increases in Number of Franchises, Employment, and Growth
The good news is that consumer spending and more money spent on housing seem to be reversing the slowdown in growth. Additionally, improvement among franchises has helped stimulate the economy.
The number of franchises and the levels of franchise employment and franchise output all grew more in 2016 than was anticipated in 2015 and is expected to continue to grow throughout 2017. As consumer spending continues to increase, the franchise sector should also improve since the two are related. The number of franchises out there is growing and many franchisors need help to get the ball rolling. That’s where a business brokerage franchise such as Transworld comes in. When you become a franchisee, you can help make other franchisors’ jobs easier.
Growth in the franchise industry isn’t a new trend. According to other reports from the International Franchise Association, franchised businesses grew at rates that exceeded those of the overarching national economy. This means that if the U.S. economy was growing by about 3% per quarter, which it was, then franchise growth should have been expected to exceed that.
That’s exactly what the International Franchise Association’s Franchise Business Outlook report showed: Franchise growth was almost double the overarching economy’s. While the economy grew 2.9%, franchises grew 5.6%.
These growth rates aren’t independent, but they demonstrate that franchises’ proven business models and assets like marketing, training, and hiring help can give them an advantage over other businesses. With major growth in the franchise industry, there is bound to be a lot of competition and franchisors need a competitive edge to make their businesses stand out. Strap on your seatbelt because a franchise brokerage industry is one of the first places they’ll turn to!
Franchise Growth Exceeds Economy’s for Sixth Straight Year
2016 is the sixth year in a row that growth in the franchise industry surpassed growth in the overall U.S. economy which means that 2017 is likely to be a great year as well. A proven business model is a factor that works in favor of franchise owners, as is the fact that franchise consultants at Transworld scope out great deals for investors.
More franchise locations mean that, on average, a huge number of first-time owners are hitting their stride. It also means that hundreds of thousands of new jobs will be added to the economy, as happened in 2016 when franchised businesses made good on the prediction that they’d add approximately a quarter-million new jobs.
In September 2016 alone, franchises added 26,000 new jobs to the economy. Multiplying that figure by 12 gives over 300,000 new jobs over the course of the year!
With national unemployment dipping below 5%, consumer spending and take-home pay increasing, and new housing construction strengthening over the next two years, there’s every reason to think that franchises will once again add more than a quarter-million jobs to the economy and experience greater than 5% output growth in the year 2017.
Open a Transworld Franchise
The franchise business economic outlook was great during 2016 and is expected to increase in 2017 and beyond. Become a business consultant at Transworld and find out how you can get your piece of the pie of this rapidly growing industry. Contact us today to open a Transworld franchise of your own!