Traditionally, at the start of each year, the experts in franchising and business analysts track the emerging trends and try and forecast what businesses should be looking out for to stay abreast of technological advances with an eye to finding those new shoots that will grow into blockbuster successes.

“Franchising, in particular” says Eric Parker of Franchising Plus “has always thrown that first stone that causes a ripple effect on the next big idea that will become a franchise sensation. That’s just the nature of franchising and amongst all the doom and gloom savvy entrepreneurs and franchisors should fall back on their entrepreneurial flair and not take their eye off the ball.”

After three years of being shell-shocked at every turn, the world has finally come out into the light with a determination that it survived and with a need to move forward at all costs. We can’t quite say that of South Africans as they struggle to find ways to keep the lights on but that should not deter them from soldering on and finding ways to circumvent obstacles.

It may seem that the world has regressed following the pandemic and its associated value and supply chain challenges and other political and social challenges but we must also recognize that all that upheaval spurred on new technological breakthroughs that ultimately will benefit businesses through increased efficiencies that will result in reducing costs and margins.

From Crisis to Opportunity

In a perfect first world scenario, we would be looking at the trends that will take root, such as niche franchises in the world of food or in the sustainability space, or predict huge growth in the pet care or elderly care market, but in our imperfect third world scenario, we take you back to basics and look at what franchisors should be aware of when planning the way forward to renewed growth and sustainability.

These trends include:

  • New Consumer Habits 

Without customers, a business cannot operate and the challenge for franchisors and their franchisees is how to retain their existing customers and attract new ones. Against the backdrop of 10-hour a day load-shedding, where consumers stay away as they cannot face being stuck in traffic, the challenge is to track those consumers’ next moves and be there when they decide to switch to on-line purchasing or surf the net to look for alternatives. Whilst price and quality remain a top priority, consumers still value the experience of their favourite brand and this should be a top priority for every franchise business. Analyse your business model and see if there is scope to broaden your offerings to include as many options as possible to make life easier for your customers.

  • Recognise market disruptors and act accordingly

Market disruptors can be both negative and positive. The global pandemic and in South Africa in particular, the riots, floods, load-shedding and general political chaos, have been the most negative disruptors our country has ever seen. But out of crisis comes opportunity, and it is often these market disruptions that spawn new ideas, new companies and technology innovations. Keeping tabs on market trends and anticipating the direction that business is heading will help to stay ahead of the pack.  Technological innovations such as the metaverse should not be seen as a passing fad but be investigated (as has McDonald’s that filed applications for the metaverse) as potential ways to expand market share.

  • Capitalize on your brand’s stability

Whether you are talking to existing customers, looking to grow your customer base or, as a franchisor wanting to attract new franchisees to the fold in this world of uncertainty, capitalize on your brand’s stability. Don’t be scared to divulge the steps you took to mitigate the challenges your brand suffered, how you stood by your franchisees and by extension how you went out of your way to service your customers. In a sea of businesses that have failed, those that are struggling and new ones that may or may not succeed, a strong brand that conveys the narrative of resilience, consideration and care will win the day.

  • Franchising becoming a viable option

An economic downturn always results in plenty of layoffs and this was exasperated by the pandemic and other mitigating factors. As more white-collar employees find themselves out of work, they’ll be looking for resilient opportunities that offer healthy returns. Franchising offers those proven models, brand recognition and a lower-risk investment.  Savvy franchisors need to be ready to grow their franchisee base with viable candidates. However, prospective franchisees will be more cautious with their investment funds, will be more selective and do due diligence on the business opportunities out there. Franchisors that strengthened their business systems and supply chains during the pandemic should be highlighting those strengths, elaborate on steps they took to mitigate the risks, introduced new strategies and how they supported their franchisees.

  • Expand with flexible franchise options

With the pool of potential franchisees at an all-time low, and with the economy taking strain, coupled with rising operating expenses (not to mention the ongoing load-shedding), it may make sense for franchisors to offer more flexible investment options in the form of smaller-footprint models whose operating costs such as overheads and labour can be somewhat contained. This would open the door to offering franchisees a lower investment with a view to it being a ‘stepping stone’ to moving to a full-scale option when the economies of scale have improved.

“Franchising is all about adaptability, says Sasha-Lee de Bod Smith, director at Franchising Plus “and good franchisors will always not only bounce back but will kick in that entrepreneurial flair that got them started in the first place.”


Franchising Plus