We have seen regular updates over the last few months on the number of cases identified and deaths from COVID-19. We also learn about the effect of the pandemic on the business sector of the nation, as more than 36 million people have filed unemployment claims since mid-March, representing 22.4 percent of the labor force of the country.
It’s a terrifying and unpredictable moment. Many individuals are only focused on survival, remaining safe, and either retaining their work or replacing the one they lost quickly. The ‘shelter in place’ fear that we live with every day generates the feeling that now is not the time to make a career change or consider starting a company, not only is this the time to conquer your fear, but this dislocation that we encounter offers a unique opportunity to regain control of your future.
Things to consider when thinking about franchising ownership in 2020
Shortened/Reduced rental prices
A year ago, any business owner will tell you that it’s extremely difficult to find a great spot at an reasonable price. That is changing today. Prime locations become available as companies close.
Econ 101 tells us that prices are dropping as the supply of prime locations goes up and the demand for those locations goes down. A new business owner now has a much greater opportunity to obtain a prime position at an affordable cost.
Everybody jumps into business in a strong economy. There is a lot of demand, but a lot of competition is also available. This also results in higher advertisement rates and fierce competition for rates.
Weaker players without stable operating systems and financial controls are closing shop in today’s world. Those with stronger systems can thrive and be able to grow market share in a better way. We’ve seen this happen in 2009, and we can see the same thing happening again now.
Employees are one of the main obstacles of company ownership. It is difficult to find good workers that you can count on. Good employees are scarce in a peak economy, and just to get them to enter your company, you must have economic incentives.
Now that is not the case. There are a number of high-quality individuals seeking work today. At a reduced cost, you can secure higher-quality jobs. The pendulum is spinning in the direction of the proprietor of the company.
Real Job Security Protection
Once again, we face the sobering fact that it is not possible to take ‘job protection’ for granted. People who have lost their jobs, have been furloughed, or are curious about the next wave of possible downsizing of businesses are rightfully concerned.
But for a moment, let’s speak frankly. You will never have job protection as long as you are an employee. Promises are made, but workers can be removed at any moment when times are tight. The only way to experience job protection is by company ownership. You will have to believe in yourself and eventually, you will be responsible for the outcomes. The only way to build absolute job security, however, is company ownership.
Incentives by Franchisor
Some franchising providers have been providing temporary promotions over the past few months. Examples include waiving six-month royalty, franchising fee concessions, paying for training expenses, or flexibility with respect to opening dates. COVID-19 is the only explanation of why these benefits are being offered. The market environment is evolving and franchisors are adjusting and adapting. For the franchisee, the outcome is a greater incentive.
Dislocations like those we see today are always terrifying. Humans have always been terrified by the unknown; change is not always evil, however. Change offers opportunities occasionally.
This year’s first half gave us all the time to focus on what is significant. This could be a good opportunity to take greater control of your professional career by considering franchising ownership if you are unsure of what your future holds.