In a recent article by Laurie Kulikowski for TheStreet.com, it is revealed that 2012 is a good time to purchase a franchise.
Author of Become a Franchise Owner! and franchise acquisition consultant, Joel Libava, shared his list of reasons to opt in for a franchise in 2012, with owners building equity, aiming for career goals, and creating an opportunity for a family business cited as some of the pros.
The CEO of the International Franchising Association, Steve Caldeira, reported though the franchising industry lost 400,000 jobs in 2009, this year the industry was projected to grow jobs by 2.5 percent and economic output by five percent. “The big issue has been a lack of credit to meet the demand for [franchisors’ and franchisees’] growth,” Caldeira shared.
Other than bank loans, the article cites other methods to obtain financing for the franchise, including borrowing against home equity and rolling over 401(K) investments into the business without penalty. Downsized workers are looking to partner with others in order to own and operate their own franchise, Shelly Sun, CEO of Brightstar Care reported.
It is noted that commercial space is available, making the possibility of obtaining a good franchise deal at a good location more readily available than in times past. The National Association of Realtors reported in their recent economic outlook report that vacancy rates in commercial real estate markets are in the double digits. However, of the office, industrial, retail, and multifamily sectors, none are expected to improve their vacancy rates over one percent in 2012.
Another reason to buy a franchise the article cited is franchisors are helping with initial costs. DoodyCalls, a pet waste removal company, is offering their new franchise owners $12,500 in their first year towards partial reimbursement of advertising expenses. Jacob D’Aniello, CEO, said, “It’s really important to advertise your business to grow. We wanted to put money where our mouth was in how much we truly believe in this.” With 55 locations, the company aims to reach 250 over the next 10 years.
Finally, talent is available considering the amount of people unemployed these days. Putting people to work is yet another reason to opt into franchising in 2012, the article summarizes.
For more information, log onto www.thestreet.com.