FBR Q2 2023

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FBR INSIDER INSIGHTS IS IT WISE TO BUY A FRANCHISE IN A DOWNTURNED ECONOMY? A new wave of franchise owners is expected in 2023 Those with an entrepreneurial spirit often seek to indulge their passion through business ownership. And franchising can be very promising for those who haven’t started a business. But, it is important to look before you leap. Do your due diligence and compare opportunities before making an investment. Your new business should ignite your passion and fit your skills, interests, lifestyle, and financial goals. During the 2008 recession and the 2020 Covid-19 pandemic, many employees experienced layoffs or chose to leave corporate America to start their own businesses. Combining their corporate backgrounds and professional skills with a franchise’s proven system and support proved to be a winning combination for many. Entrepreneurship comes with some risks, particularly when facing a possible recession. However, in 2023, a new wave of eager franchisees is expected to capitalize on exciting new business opportunities. 1 FINDING THE BEST RECESSION-PROOF FRANCHISE FOR YOU Hundreds of franchises claim to be “the best.” So, how can you weed through the noise to find the right franchise fit for you? Franchise Business Review surveyed 36,460 franchise owners representing over 365 leading franchise brands to determine the award winners on our 2023 Top Recession-Proof Franchises list. The franchises on this year’s list not only have outstanding franchisee satisfaction ratings, as reported by the franchise owners themselves, but they also demonstrate a strong potential to outperform their competitors during challenging economic times. 1. Forbes: Franchising Trends To Be On The Lookout For In 2023 Kitchen Tune-Up franchise owners Kamal and Joti Bulsara. Our recession-proof list is a great place to start your exploration into franchising! Here are some key things to focus on during your research when comparing franchise opportunities, speaking with franchise owners, and interviewing the franchisor. PROFITABILITY AND BENCH STRENGTH More aspiring entrepreneurs are looking for resilient business opportunities that offer substantial returns. If you are interested in buying a business, the profitability potential of that business is likely one of your greatest concerns. Estimating a business’s financial potential can be nuanced. Luckily, there are resources to turn to for evidence of past profits that can help you forecast your profit potential: Inspect item 19 of the Franchise Disclosure Document (FDD) closely and speak with other franchise owners about how long it took to become profitable and their long-term profitability. Although labor shortages and supply chain challenges continue to impact the profit margins of many businesses, a franchisor may be able to negotiate better prices for supplies and materials due to their larger purchasing power and established vendor relationships. This strengthens the entire system and can help lower costs and increase profit margins for franchise owners. 20 | For more information on the companies in this report, visit www.FranchiseBusinessReview.com
FBR INSIDER INSIGHTS FEATURED FRANCHISEE IN-DEMAND PRODUCTS AND SERVICES Franchising has historically performed well across all sectors despite economic volatility. However, some tend to be more recessionresistant than others. “Franchises in the need-to-have, rather than the nice-to-have, segments are more likely to fare well during a recession,” said Eric Stites, CEO of Franchise Business Review. “The products and services consumers are less likely to cut back on during a downturn include childcare, education, elder services, pet services, home repair, business services—even restaurant franchises. Americans love to dine out. That’s not going to change anytime soon. In response to recessions and the pandemic, many restaurants have developed new models to serve diners better thanks to delivery, curbside pickup, and additional drive-through capacities. Look for a franchise that offers in-demand products or services that can be agile and innovative in response to changing market conditions.” FRANCHISOR GUIDANCE AND SUPPORT One of the biggest reasons people turn to franchising rather than “going it alone” is the stability a franchise system can offer. Most franchisors provide training and ongoing support to their franchisees. Franchisor support can be especially valuable during an economic downturn when business owners may need to adapt their operations to changing market conditions. How responsive is the franchise in question to market changes, supply chain challenges, and unexpected hurdles? Be sure to ask the franchisees if the initial training and support were sufficient, how much ongoing training and support is provided, and if they can rely on their franchisors for guidance and support during challenging times. When speaking with the franchisor, ask for examples of their responsiveness to unanticipated challenges and how they support franchise owners during challenging economic times. We invite you to explore the award-winning franchises on our Top Recession-Proof List as part of your due diligence. ■ FRANCHISE WITH THE LEADER IN RETAIL LAB TESTING NAMED A TOP 100 RECESSION-PROOF FRANCHISE AND TOP FRANCHISE FOR WOMEN BY FRANCHISE BUSINESS REVIEW Any Lab Test Now provides a convenient way for consumers and businesses to manage their healthcare choices. Our retail franchise business model provides franchisees with built-in advantages. DAN CALDICOTT HomeWell Care Services Natick, Massachusetts Franchise owner since 2020 70 Employees Dan Caldicott and his wife were at a transition point in their careers and considering what they wanted to do in the second half of their lives. “We had many skills that easily would easily translate into owning and operating a franchise, but we’re not natural-born risk-takers or entrepreneurs. So, we needed a business model to follow to gain the confidence to become business owners. Integrity was at the top of our criteria list. It is the starting point for all things. Communication was second—it fuels progress. Opportunity was third. So we went to work conducting our due diligence.” “The FBR website provided a 30,000-foot view to assess and compare opportunities and allowed us to dig deeper into the finer data points. Franchisee satisfaction also played a big role in our research. HomeWell Care Services consistently checked all the boxes!” “We also loved the new leadership team and resources that HomeWell had put in place. We get lots of direct support from the corporate team. We have a wealth of tools at our fingertips. We have a dedicated Franchise Business Coach and a family of fellow franchisees.” “As a HomeWell franchisee, I love helping people in need, guiding them, educating them, solving their challenges, and giving them a path forward. We connect on big important things like health, family, and what it means to be happy. Nothing compares to that.” Learn more: anylabtestnow.com/franchise For more information on HomeWell Care Services franchise opportunities: • Call: (817) 916-8904 • Email: franchising@homewellcares.com • Visit: homewellfranchising.com Fran Dev Ad - 6_22 Update (1).indd 1 3/31/23 4:53 PM For more information on the companies in this report, visit www.FranchiseBusinessReview.com | 21
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FBR Q2 2023

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