Things to consider in starting a franchise.

Things to consider in starting a franchise.

Whether you want to switch gears and find more satisfaction in your daily life, are looking to control your wealth accumulation better, or are looking for multiple revenue streams, owning your own business is something to consider.

Before you enter into anything, however, it is critical to consider all avenues, their advantages and disadvantages, and find what is a good fit for you personally. For some, that might mean a new business startup or pursuing a franchise opportunity—either way, go into it with your eyes wide open and gather all the information you need to get started.

Here are some of the key forecasts of the Economic Outlook from the IFA to help. Always do your own due diligence before entering into an agreement of any kind.

Key forecasts for 2023 include:

·????????The overall number of franchise establishments will increase by almost 15,000 units, or 1.9%, to 805,000 units.

·????????Franchising will add approximately 254,000 jobs in 2023. Growing at 3.0%, total franchise employment is forecasted to reach 8.7 million.

·????????Total franchise output will increase by 4.2%, from $825.4 billion in 2022 to $860.1 billion in 2023. Compared with 2022, franchises’ GDP will grow at a slightly slower pace of 4.2% to $521.3 billion. Franchises’ GDP share of the overall economy will remain stable at 3%.

·????????Service-based industries and quick service restaurants (QSRs) will witness higher growth than other industries.

·????????Texas is expected to witness the most growth in franchise activity in 2023. Growth in the Southern U.S. will outpace the rest of the U.S. franchise market.

Industry-Specific Forecasts:

?Service-Based Businesses to Outpace the Rest The growth of service-based businesses and QSRs is expected to outpace the rest of the franchising sector, which is still recovering from the pandemic to a greater degree. Personal services and QSRs are expected to grow by 2.5% in 2023. Given real estate challenges and weaker consumer spending on discretionary items, full-service restaurants, lodging, and real estate will witness slower growth in 2023 of 1.1%, 0.8%, and -0.5%, respectively.

Regional Trends

The economic growth of franchising in each state will remain varied based on labor availability, infrastructure investments, and business climate. FRANdata expects that in 2023, the growth in the Southeast and Southwest regions – which witnessed positive migration trends, large industry investments, and strong labor markets – will outpace the rest of the United States. While each region is expected to grow in 2023, the growth in the Northeast region will be muted at approximately 0.8%.

·????????The Southeast region is the largest franchise market, with approximately 234,000 total forecasted units in 2023, employing 2.6 million people and providing $250.0 billion in total output. This region is expected to increase at a rate of 2.2%, which is greater than the forecasted growth rate of national franchised businesses.

·????????The top 10 fastest-growing states are Texas, Illinois, Florida, Georgia, Tennessee, North Carolina, South Carolina, Arizona, Colorado, and Indiana.