Hardest-Hit Franchise Categories Lead July Growth in Inquiries
The volume of entrepreneurs contacting franchisors to explore owning a franchise strengthened for the third month in a row in July, with the highest growth occurring in categories most affected in prior months by social-distancing and uncertainty brought on by the coronavirus pandemic.
Many categories also saw gains in the average number of investment inquiries per franchise, according to data from the FranchiseVentures network of lead-generation brands, which provides the largest source of prospective franchise buyers in the United States.
Franchise Categories Showing the Most Growth
- Food and Restaurant franchises led the growth, gaining volume for the second month in a row. The category added 20% more investment inquiries from June to July, after growing 17.4% from May to June. The number of Food franchises actively seeking franchisees also grew in both months – up 18.4% in July, following a 6.5% gain in June. Not surprisingly, takeout and quick-serve restaurants are seeing more interest than full-service, sit-down establishments.
- Senior and Health Care franchises, featuring concepts like in-home care and senior-living placement services, grew 13.7% in July after logging a 19.5% gain in June. This category has shown relative strength throughout the pandemic, as an aging population creates strong demand in all economic climates, and especially so during a health crisis and limited access to senior care facilities.
- Personal Care franchises grew 13.3% in July after leading June with a 55.7% increase in prospects contacting franchisors. With hair and nail salons, spas and cosmetic stores, investment interest in this category is affected by social-distancing concerns, but potential franchisees are looking months down the road for business openings.
- Rounding out the top 5 growth categories, Pet Services franchises saw an 11.2% increase in July, and Automotive franchises like oil change,windshield repair, tires and transmission repair shops, logged a 9.2% gain.
Top-Growing Categories Also Increase Average Inquiries per Franchise
While Food and Restaurant franchises saw growth in both prospect inquiries and the number of active concepts, the average number of inquiries per Food franchise was flat from June to July. But other growth categories saw the average contact rate increase by double-digits:
- Personal Care franchises were selected by 21.4% more inquiries on average in July, and Senior and Health Care franchises averaged 19% higher contact rate. Automotive franchises grew prospects per franchise brand by 17.4%.
- Also growing the average number of inquiries per brand were Cleaning and Maintenance franchises (9.6%), Health and Fitness franchises (6.9%) and Child-related franchises (5.4%)
The Franchise Insights analysis is drawn from FranchiseVentures, 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.
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Published on Wednesday, August 19th, 2020.