Looking ahead

Cathryn Hayes reflects on what 2012 has brought for the world of franchising, and the things to consider in the forthcoming year

There is no denying that 2012 has been a challenging year for UK businesses. The economic recession forced sweeping changes in strategy for many businesses, add to this increased unemployment and reported lack of available credit and it’s not surprising many firms have struggled. However, franchising has remained resilient during these difficult times.

This is due mainly to the wide spectrum of industries covered by franchised businesses, the strength of the business model and the support provided by franchisors and other franchisees within the same networks. So what are the key things prospective franchisees will need to consider over the forthcoming year? Getting on board with franchising With UK unemployment forecast to grow by a million this year, following the slowdown in the economy, finding a new job after redundancy could prove challenging. Franchising can provide a solution.

As most franchises are designed for people with little or no experience in a specific industry, starting a franchise allows you to try something new. Could the many thousands of members of the armed forces forecast to lose their jobs be the next generation of franchise owners? – these are highly trained and skilled candidates, many of which would be perfect for franchising. Finding funds to set you on the way There is still plenty of funding available for sound business propositions.

Franchisees are in a stronger position than a stand-alone start-up due to the help and support available to them. Requests for funding are more likely to be agreed if franchisees present a professional and credible business plan. Additional help and assistance on writing a business plan can be found at most lending banks. HSBC, for instance offers an online resource to help small business owners.

Support in the long term Many small business owners are just too busy to look at what is happening in the marketplace, what competitors are up to, and how customers’ needs might be changing – but a good franchisor will be looking at research and development, helping their network of franchisees to keep ahead of the game by looking at alternative income streams.

Cathryn Hayes is head of franchising at HSBC Bank.

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