The December issue of Entrepreneur Magazine–which just hit my inbox–has a great article about the macro trends it expects will be driving franchising in the coming year. Unfortunately, a link to the piece, by Jason Daley, does not yet seem to be live on the magazine’s website. So, I’ll attempt to summarize the trends here:
- Area Bombardment. As the economy headed downhill over the last few years, franchisors headed abroad. In that process, the franchisors partnered with deep-pocketed developers who had the knowledge to understand the culture and open many units at once. Daley believes, as the economy picks up steam and franchisors return to the United States (and the glut of real estate available at cheap rates), they will continue to want to work with area developers who can leverage economies of scale.
- Refranchising. We have all noted the refranchising trend–and observed the debate over whether this trend shows the strength or weakness of franchising as a business model. Daley asserts that refranchising merely shows that franchisors are focusing on what they do best: policing brand standards, developing innovative new products, and overall business strategy.
- Healthy Fast Food. After fits and starts–I love you, McDonald’s, but the McLean burger still makes me break out in a cold sweat!–the industry is learning how to make tasty, healthy food–yeah, I’m still talking about you and your tasty oatmeal, McDonald’s–and consumers finally appear willing to purchase healthier alternatives. That’s a win-win.
- Digital Data Overload. We live in a digital world, and the data being collected and analyzed is now being used to aid in site selection, franchisee selection, and customer retention. Great ideas executed well will always be the core of successful franchising, and now the digital age will allow the most nimble systems to execute their ideas in ever better ways.
- Busting Bubbles. Daley rains on the parade of good news somewhat when he suggests that some recent trends–particularly frozen yogurt and quick-serve "better burgers"–may have run their course.
What do you think? Are there macro trends you’re watching and believe will be relevant in 2013? We’d love to hear your comments.