The Recession Busting Route to Growth

The doom and gloom media coverage from the last eight months has been enough to put off any business owner looking to expand their operation in the current climate. However, if we look at industries that are not particularly linked to property and the related financial markets, there is one industry that manages to beat the ‘crunch’.

As a measure of some good news – the franchising industry grew a massive 15% (more than five times than the UK economy) in 2007, and is estimated to be worth a staggering £12.4billion*.

The business model tends to thrive in a tough climate, which is proven in the phenomenal growth. If bigger companies are looking to make more of their staff redundant – this is all good news for franchisors who are seeking motivated, committed and hardworking franchisees for their networks.

Choosing to grow via franchising presents a considerably lower risk to the franchisor (business owner) and less capital investment. It also provides the opportunity to have a network of franchisees who have a serious stake in making the business work and are motivated to grow the brand. Loyal employees are great, however on a purely financial scale, they are an overhead and if they leave, this represents a risk to the business owner in the loss of intellectual property as well as the cost for recruiting, training and replacing the value lost. By expanding via franchising, the business owner reduces direct overheads, but can grow exponentially and generate more revenue in the long run.

(*The NATWEST/BFA Franchise Survey 2008)

Copyright © 2008 Shelley Pearson.
Reprints are welcome, as long as the by-line and article are published in tact and all links made live.

About the Author

Shelley Pearson, formerly an independent franchise consultant, created the Expert Franchise Guide business after identifying a serious lack of a provision of franchise business guidance products to small and medium sized business owners. She has developed her products in order to solve one of these business owners’ biggest operational obstacles: access to decisive, experienced and cost effective franchise business guidance. She is now an information marketer and has managed to attract both professional affiliations and clients who recognise and value her business acumen matched with a practical and empathetic approach.