What industries are the hottest for new franchises during the recession?
There are three secrets to finding a business that does well in tough times:
1. Find one that people have to use regardless of the economy. The classic example is hair-cutting. Hair grows and it has to get cut--in good times or bad. When your business involves a product or service that people use regardless of the economy then you'll do well in a recession.
2. Find one where the service is paid for by a third party with deep pockets, like an insurance company or the government. The classic example is the restoration business. If a pipe bursts and floods your basement, your insurance company is going to help you locate a restoration company to fix the damage and they will pay the bill for the repairs.
3. Find a franchise that is supported by a huge demographic or market trend. The classic example in today's market is non-medical in-home senior care. There are a bunch of franchise companies in this space and they all seem to be doing well because the baby boomers are expanding their customer base as fast as new units can open.
Good luck on your search.
Jeff Elgin has almost 20 years of experience franchising, both as a franchisee and a senior franchise company executive. He's currently the CEO of FranChoice Inc., a company that provides free consulting to consumers looking for a franchise that best meets their needs.