Covid-19 Motivates Aspiring Franchisees To Pursue Ownership, According to Small Business Startup Sentiment Index™
When asked how Covid-19 had affected their interest in starting a business or opening a franchise, respondents to the FranchiseInsights.com Small Business Startup Sentiment Index™ showed a noticeable increase in the desire for “controlling my own destiny through business ownership,” up from 27.9% in March to 38.3% in June of 2020. While the cause is unknown, the high (though improving) unemployment rate and the rising stock market likely were factors.
Responses to the same question also revealed a strong orientation toward “businesses that would be resistant” to shocks like Covid-19. As detailed in a recent article on rising interest in certain franchise categories, aspiring owners are gravitating to franchise brands that haven’t been sidelined by social distancing measures and forced closures. Indeed, 29.2% of respondents in June indicate their searches are being shaped by these considerations.
Only 7.1% of June respondents have “decided to put my business startup on hold for now” — a sharp decrease from March’s 19.2%. As discussed in a recent article, 66.4% of prospective franchise owners in June agree or strongly agree that “now is a good time to start a business.” In fact, 55.9% of respondents anticipate they will have launched their new business within the next three months.
Some entrepreneurs have had to recalibrate their expectations regarding how much they can invest in a startup business. In June, 14.9% of respondents indicated that Covid-19 “reduced the amount of capital I have to invest.” On the bright side, that figure was down substantially from April’s high-water mark of 28.7%, suggesting that stock market’s recovery might have refilled their coffers.
The Small Business Startup Sentiment Index™ is based on a monthly survey of individuals who have recently inquired about businesses or franchises for sale on the digital assets of FranchiseVentures.
FranchiseVentures is the leading demand generation platform for potential franchisees to thousands of growing franchise systems in the United States and Canada. Its franchise lead-generation brands include Franchise.com, Franchise Solutions, Franchise Gator, Franchise Opportunities, Franchise For Sale, and BusinessBroker.net, and together they provide the largest aggregation of prospective franchise buyers in the U.S.
Interested in more insights from our proprietary data set? Subscribe to our email newsletter below, or follow us on LinkedIn.
Published on Thursday, July 9th, 2020.