As we have mentioned before, we live in a country obssessed with lists (I just read about the Top Ten Cupcakes in the World) and the franchising world is no different. Entrepeneur Magazine has just released two lists:(i) a list of the top 50 new franchise opportunities for 2012; and (ii) a list of the top ten franchises for 2012.
Of course, all lists of this nature are subjective, but the assemblage of franchises mentioned in each list offer some interesting highlights into what may be going on in the economy in general and franchising in particular. The top 50 list offers a dizzying array of businesses, but certain trends emerge. Two of the top 10 are frozen yogurt shops and four others on the list offer frozen yogurt or smoothies, which suggests a healthy trend. On the other hand, four of the the 50 franchises sell burgers. So there’s a countertrend. Seven concepts relate to personal appearance or physical conditioning. Six relate to home improvement and four are in the health care industry. One even sells cupcakes.
It seems that if you were to try and detect the trends in what we are focused on as a society at any given time, you may be able develop a successful franchise concept on one of those notions. But you have to be nimble and move fast, because as a nation we have a notoriously short attention span and not all of our trends of the moment stand the test of time. Some of these ideas ring particularly true for this writer, who has children and aging parents: HappyFeet Legends promotes soccer programs for kids. Acti-Kare provides non-medical in-home senior care. Other ideas seem more of a stretch: RimTyme provides rent-to-own custom wheels and tires. I wouldn’t have thought of that, but there they are at #17, so what do I know?
The top 10 list consists of business models and franchise systems that have stood the test of time: hospitality (Hampton Hotels and Days Inn); fast food (Subway, McDonalds, Denny’s, Pizza Hut and Dunkin’ Donuts); 7-Eleven, H&R Block and ServPro (damage restoration). The story with each of these ten is that they have continued to grow and improve, despite appearing to approach saturation in their respective markets. How they found room for improvement varied in each concept, but there was always a strong focus on some vital aspect of the business. Hampton improved service. Subway and McDonald’s expanded their offerings. Denny’s and Pizza Hut went international. Dunkin Donuts and 7-Eleven grew into new domestic markets and expanded their brands. ServPro and Block expanded their service offerings.
What is the takeaway? (To use the latest addition to corporatespeak). Find a niche in a segment of the market that is currently popular or, better yet, which is about to become popular. Jump in with both feet. Don’t try to be too much to too many people. Know your business and your clientele and remain focused. And then stay nimble, always improving, always watching, to stay ahead of the next shift in public perception.