When it comes to investing in a franchise, you’re taking on a risk by entering the unknown as a new business owner. But the benefits of franchising include the fact that you’re also signing on to bring a team of experts to help you grow your business and a recognized brand to your community.
1851 Franchise connected with the CEO of Franchise Business Review, Eric Stites, and the VP of Marketing at FranNet, John Blair, to compile a list of your best bets for 2017 (and really, for the years to come).
With a variety of growing senior care franchises, there is no surprise as to why the space is growing. The industry offers one of the highest return on investments in franchising with most costs to opening a territory tending to be around $100,000. And this also allows franchisees to build one or two million dollar businesses off of that relatively small investment.
“The ROI is extremely high, but with that being said, senior care is an industry that requires a lot of hard work, a lot of management of people, and it’s a 24/7 365 job,” Stites said. “If someone gets into it just for money, it’s probably not going be successful. You have to love people and the management of people. There is also regulation in the industry that you will need to be prepared to deal with.”
Because the senior population is the longest living and wealthiest generation, any products and services that cater to that demographic will naturally do well.
Hair care has proven to be a successful model for years, and there is no end in sight for the industry. Everyone needs to get their hair cut, and the industry is both recession resistant and technology resistant.
“You have to actually go and get your hair cut; it’s a human business,” said Blair. “There is an app to make your appointment, but there is not an app to actually cut your hair.”
Another industry that tends to have a high ROI with minimal upfront investment is services for businesses. These types of services include business coaching, accounting, tax and financial services, with a typical initial investment under 100,000.
“You can grow a very large business and create a very lucrative income for yourself with a lower investment in the business services space,” said Stites. “The business model just works really well for these services.”
Automotive Maintenance and Repair
Similar to hair care, cars need to be fixed no matter how the economy is doing. With more and more Americans keeping their cars for longer periods of time, it is necessary to care for them.
“When you look at automotive maintenance and repair franchises, you realize that the average age of a car on the road these days is 11 years, so people are taking care of their cars,” Blair said. “I’ve been noticing more and more tire stores popping up, and in the back, they’re doing oil changes, brake jobs, alignments, maintenance and repair. Cars aren’t going away. People will always own cars, so it’s a good business.”
Home services tends to be a very steady industry, including franchises like maid services, home inspection, and damage restoration. People by-and-large use home services on a regular basis. With the need to keep your home clean, maid services overall are a great investment that provide for consistent revenue. Damage restoration is also need-based, with an ongoing flow of business for the franchisee.
“Service based businesses will always offer the highest ROI,” said Blair. “We suggest researching businesses that will always do well. When looking for long-term recession resistant and always in demand businesses, you’re going to find continued success.”
Ultimately, when looking for a solid brand to invest in, avoid a trend that will come and go quickly. Focus your search on stable industries that have a proven record, will be around for years to come, and are meeting a need that people will pay for.