As 2019 comes to an end, let’s take a look ahead. What trends and changes can we expect to impact the franchising industry in the coming year? Read on to find out which 2020 franchising trends we’re keeping an eye on.
The Integration of Tech
Technology is an increasingly important part of our lives — and the franchise industry. For years, franchisors have made a point of proving that their franchise can’t be replaced by technology or computers. But in the near future, you’ll notice more franchisors that not only compete with tech, but integrate it as well. Whether it’s customer relationship management (CRM) systems, point of sales (POS) systems or product tracking, franchisors will be integrating tech that will make things simpler for franchisees and their staff. This might look like online food tracking systems for fast-casual franchises, or proprietary POS systems that help franchisees aggregate daily financial data. In 2020, expect to see more franchisors showcasing the ways technology is a part of their business model.
Multi-Unit Franchising Continues to Dominate
Multi-unit franchise ownership continues to grow on the way into 2020. Since at least 2015, multi-unit franchisees have accounted for more franchise locations than single-unit owners. There are several reasons for this shift, including a small but growing number of franchisors who are only seeking out entrepreneurs interested in multi-unit ownership. And as more sophisticated concepts enter the franchising market, more franchise owners with the experience (and capital) necessary to open multiple units will be attracted to specific franchise systems. Multi-unit franchisors are also better protected from recessions and other economic challenges.
Technological advancement will also continue to make multi-unit ownership easier for franchisees. Thanks to video calls, digital records, and online accounting management, franchisees can conduct their business from anywhere, meaning they don’t have to live in the same town as all of their franchise locations.
Meet Gen Z
Ready or not, Generation Z is entering the workforce. While they likely aren’t ready to become franchisees in their own right quite yet, the oldest Gen Z-ers (born between 1995 and 1997, depending on the source) are graduating college and entering all industries — franchising included. In fact, Gen Z-ers are expected to comprise 20% of the workforce in 2020. This generation is tech savvy, culture-focused and looking for a career with stability. As franchisors start to court Gen Z-ers as consumers, employees and franchisees, they will have to be willing to adjust their model to match the values of Gen Z. We don’t yet have a full picture of the impact Gen Z will have on the franchising industry in 2020 but we will be sure to see changes as they continue to make their mark on the industry.
In 2020, we can expect to see some changes in the industry thanks to increasingly-integrated tech, the continued growth of multi-unit franchising and Gen Z becoming one-fifth of the workforce. Find the perfect franchise opportunity – one that is prepared for all the changes 2020 might bring – by exploring all of the opportunities America’s Best Franchises has to offer.