Franchising is a concept that has evolved significantly since the first McDonald’s opened in Illinois in 1955. As of 2016, the chain operates in 120 countries with more than 37,000 restaurants, with 84 percent of them owned by franchisees. Franchises were formerly for an individual wanting to be their boss, but now many franchises are owned by multiple people who own many all over the area. They manage their employees and focus on how to expand and succeed in business. Some franchises choose to expand to include multiple brands. Here’s the direction franchising seems to be going in the future.

  1. Changing demographics

    The shift in age for the U.S. population is changing the labor market and who consumers are, creating a need for change in how franchisors operate.

    Baby Boomers – Baby boomers make up a significant portion of the consumer market. They need services in finances, retirement, assistance with healthcare, tax services, and education for their children and grandchildren. As life expectancy increases, seniors need more health care, assisted living facilities, and membership opportunities for fitness and health programs.

    Millennials – Millennials consist of more than 70 million people working, traveling, and starting families. These Internet-driven individuals offer valuable services with their skills to power the franchises or offer them goods as consumers with the services they need.

    Minorities – The United States continues to get more diverse with an increasing number of Asians, African Americans, and Hispanics dominating the market, increasing the demand for unique food and fashion. Franchises and brands can gear their advertising to meet the new consumer wave.

  2. Areas of growth

    Part of going into business is taking on a risk. Your goal is to make the risk as minimal as possible, which is possible if you go into a market where the demand exists.

    Recession – You want to offer goods and services that consumers need, even during slow economic periods. These include childcare, tax preparation, a cell phone repair franchise, real-estate, home repair, and employment services among others.

    “Green” services – Energy-related services are on the rise with more people looking to use recycled materials and use less energy. Weatherization, energy-efficiency, and handyman services are spiking in popularity. The trends also show that it’s more common to re-use, fix, and re-purpose items than it is to buy new and contribute to environmental waste.

    Fitness – People are looking to take better care of themselves with fitness centers, nutrition businesses, sports, gyms, and healthy eating options.

Going into business is never risk-free, but making a wise decision about the industry you enter can minimize the risk. Look at the trends for the future and strive to meet consumer needs.