In the past year, we were thrown into the dungeons. The only thing we had going is the thought of having to survive day by day. That is what it is like for businesses, especially franchises whose contracts are iron-clad. Franchisees have to make do with what little capital they have. They are, after all, at the mercy of those contracts they signed a couple of years back when the business community was flourishing. But alas, the pandemic happened and so begins the cracks and gaps that seep into every corner of a business franchise: was I right to buy a franchise and not just establish my own business?
Every franchisee has asked that of themselves. In fact, if you have done the process right, that is one of the first things that you should ask yourself. But budding entrepreneurs—those who do not have experience running a business—want to first try their hands on a franchise. The experience and training they get from running a franchise will then help them build their own business from scratch in the future.
Is a business franchise still a practical choice under the circumstances? What will be the impact of the pandemic on the future of franchises? How about technology? What could be waiting around the corner?
Reliance on Technology
Franchises will rely heavily on technology. This is why a tech franchise will remain as one of the most successful business models. Everyone—individuals, small businesses, and big conglomerates—will need tech services now and in the future. The market is vast for a tech business, so if you have an opportunity to be a part of one by becoming a franchisee, then do it.
On the other hand, these franchises are also going to depend on innovations such as cashless transactions, subscriptions, private networks (WhatsApp, Viber, Line, and Telegram), social channels, video marketing, and social listening. They would need to embrace how technology has contributed to their growth. They also need to harness the advantages of technology to reach new markets and expand their services.
New Data, No Point of Comparison
Franchises operate by comparing data from a year or two ago. As a franchisee, you will know if your business venture is paying off if the business is registering growth every year. But there is no point of comparing in a post-pandemic world. You cannot compare your sales in 2020 because nothing happened then. You certainly cannot compare to 2019 because everything was normal back then. Instead, franchisees will need to figure out a way to cut the clutter and ignore the noise. They need to hone-in on the fact that no past data will help them set their goals now.
Opportunities Born out of Turbulence
What is turbulence in life? It can happen to anyone. You’re a manager in a store that was deemed non-essential during the pandemic and after the pandemic. The company closed down and you’re left without work. You are now taking a leap of faith, thinking of starting your own business or buying a franchise. That is what franchises should recognize—how to embrace these turbulent times of a former career woman who now realized she doesn’t want to be an employee anymore.
Access to Capital
The biggest problem for franchises now and in the next couple of years is how to fund their operations. No franchise business has come unscathed from the pandemic. Clearly, all revenues have taken a hit. Goals were not met. This also means that the working capital might be depleted. Access to capital will become a major problem unless governments do their part by ensuring low-interest rates for small business loans.
Businesses didn’t use to be so obsessed with personal and authentic stories before the pandemic. Though there were already signs of the need for authenticity in marketing, this wasn’t as obvious as it was during the pandemic. The main franchise itself has a story to tell, but what about the franchisees? What are your stories? Why did you invest your life’s saving in this business? Customers love to hear about your process. They like knowing that like them, before you decided to dive into this franchise, you have apprehensions about successes and failures.
Businesses will never be the same again. After a year of uncertainties and turbulence, businesses must work to become resilient to pandemics. This will be ingrained in every business, no matter what industry it belongs to. The community will never forget the unimaginable grief caused by the pandemic and the ways that it has shaken the stability of many industries.