Franchise Opportunities Continue To Grow, New Report Shows

If you've ever wanted to own a franchise or expand your current franchise portfolio, now may be the time to do so. Despite a continued lending gap, franchise interest and opportunities will continue to grow in 2012, according to data from the Small Business Lending Matrix developed by FRANdata and the IFA.

The report found that there remains high demand for unit transactions and transfers, an increased lending ability from banks and a steadily recovering economy, continuing a trend that began in 2010.

While banks will hit their highest willingness to lend since the start of the recession this year, they will still come up short compared to franchisee demand. Franchises will require an estimated $11.7 billion in new lending capital to fulfill the forecasted demand for new units, however, banks are only projected to lend $9.5 billion.

The lending gap has been gradually closing since 2010, when it hit 22.8 percent, compared to the projected 18.6 percent in 2012. With the projected $9.5 billion in lending available, 35,997 franchise units will be financed, creating 425,187 jobs and generating $56.7 billion of economic output annually, according to the report. “Education is now working and lending is freeing up giving franchising the ability to continue to spur job creation," said Jon Luther, IFA chairman.

The lending gap will account for the loss of 8,230 units, over 97,000 jobs and nearly $13 billion in annual output.

The report points out that as unemployment rises, interest in franchises increases. Historically, franchising opportunities have shown resilience during past economic downturns, including 6 percent growth early in the new millennium and a 5 percent jump after the tech bubble. While interest in franchising remains steady, the struggle to obtain capital from banks has hampered growth and ultimately slowed the pace of economic recovery.

Comments

[franchiselove]

10:04 PM on 12/21/2012

Leverage Franchise Marketing Strategy And Increase Franchise Marketing Companies Brand Exposure to Generate Sale Through Specialize Franchise Marketing Systems. www.franchiselove.com

[iFranchise News]

12:14 PM on 11/17/2012

One way to learn more about franchise-centric companies is to research and subscribe to their press releases. iFranchiseNews.com is an online research that offers extensive franchise press release services that can prove beneficial to franchisors, franchisees and potential franchisees. You may learn more at: www.ifranchisenews.com. You may also follow iFranchiseNews.com on Twitter at www.twitter.com/ifranchisenews . The franchise business model offers numerous advantages that can be quite appealing to future and current business owners.

[bmcpherson]

06:51 PM on 05/15/2012

The financial "crunch" for small businesses has been a challenge in franchising for the last several years. Having been a senior executive with both retail and larger up front investment franchises, I've seen first hand the impact of the access to capital to Franchisors, Franchisees, employees, and consumers. I'm very fortunate now to be on the management team of one of the hottest new concepts in staffing, Mom Corps (www.momcorps.com). Among other things, Mom Corps is a low investment, start from home, services business that in almost all cases does not require 3rd party financing to get started. Moreover, because the Franchisor handles all payroll, taxes, invoicing, etc. there is no need for Accounts Receivable financing for our franchisees! While Washington sorts out it's financial quagmire, it's nice to know there are great business opportunities still out there for people, that don't require 3rd party financing.

[Bed Bug Franchise]

08:21 PM on 04/19/2012

2012 is a great time to get into a franchise, they are absolutely right! There are many franchises out there that are similar burgers, pizza, yogurt, etc, etc. You know bed bugs are out of control and most people call an exterminator, how about a BedBug Chaser instead! A compnay that focuses on just bed bugs and can get rid of them in 1 treatment with no chemcials, while being 100% Green inside your home??? Never heard of this right, because up until now it hasn't existed check out www.bedbugchasers.com for a different kind of service franchise.