Someday in the future, when people look back on the time line of franchising, they'll likely recall 1996 as a turning point. New trends, concepts and ways of operating were springing up left and right; meanwhile, in the legal arena, franchisors and franchisees alike were rocked by a series of surprising events. Here, a look at what's new . . . and what the future may hold.
Now that rotisserie chicken, bagel and coffeehouse franchises have gone from new kids on the block to industry staples, what concepts will emerge in 1997? After spending considerable time combing through industry data, compiling a massive database and going to sleep with visions of franchise trends dancing in our heads, we've chosen a few concepts that are emerging from the pack:
- Internet franchises. "Companies are getting involved in franchising from the standpoint of home page development or other services," says Mark Siebert, president of Francorp Inc., an Olympia Fields, Illinois-based management consulting firm specializing in franchising. And the timing for these cutting-edge franchises is impeccable: About 40 percent of large companies and 25 percent of medium-sized and small businesses have either developed or plan to develop Web sites, according to market research firm O'Reilly & Associates.
- Senior services. Surely we needn't tell you again about all those baby boomers turning 50 last year. Franchises are already targeting the 50-plus crowd--services such as financial planning for retirement and care facilities for Alzheimer's patients should mature in 1997. Meanwhile, residential elder-care facilities, which have been cropping up since the late '80s to provide an apartmentlike alternative to traditional retirement homes, are starting to catch on with franchisors.
- Juice bars. After hitting it big in California, juice franchises are starting to branch out to the rest of America. They are, however, expected to do well only in regions that boast young and affluent consumers, and, in most cases, they require a warm climate to ensure availability of produce.
- Water stores. With consumption of bottled water hitting $3.4 million in sales last year, some believe water is the only beverage strong enough to rival coffee franchises in the future.
- Specialized staffing franchises. According to the National Association of Temporary and Staffing Services, receipts in the specialized staffing industry rose to $20.8 billion in the first half of 1996, offering franchises a ripe market. Many staffing franchises have also added employee leasing to their repertoire.
- Children's activities. Franchises that blend education with fun are still hot, as are a variety of cutting-edge child-related businesses, ranging from baseball camps to Victorian tea parties. Children themselves are proving to be no minor market--they make or influence almost $150 billion in purchases each year.