For people considering getting into business for themselves, especially in the New Year, franchising is one option many will likely investigate.
Franchise businesses make a sizeable contribution to Australia’s economy, turning over around $131 billion in revenue annually, according to the Franchise Council of Australia.
It says there are around 73,000 franchise businesses in Australia that employ around 400,000 people.
General manager Kym De Britt says franchising has grown at a better rate than other small businesses, citing a PricewaterhouseCoopers report that says franchises have seen average annual revenue growth of 10% recently.
“That generally comes because when things are tough, franchise systems have better support and marketing systems to help franchisees sustain the difficult times better,” he says.
De Britt tells StartupSmart that the main attraction for people getting into franchising is for the support.
“Rather than just taking that big step of going into business for themselves, they have a level of support behind them.”
Franchisees receive training in how to run the business and have someone to go to if there are problems, De Britt says.
“It’s working for yourself but taking on an established system and having support.”
But he warns that franchising is not for everyone and that it may not suit people who want to “do it for themselves”.
“For those kinds of people, franchising is not the right way to go because at the end of the day you have to follow the model because it’s been proven,” De Britt says.
He also recommends anyone considering a franchise to get legal and financial advice and to understand that it can’t be considered a means to semi-retirement.
So what types of franchises are most likely to see growth in 2014?
De Britt says people can get a sense for what business areas will be successful by looking at the media for trends, but here are his picks for areas to consider:
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