Crystal ball prediction the future of franchising
Published January 4, 2021

21 Franchising Predictions for 2021

Franchising Thought Leaders Share What They Expect in the Coming Year

2020 was one for the books, to say the least. Franchising faced challenges we never could have imagined this time last year, and while some businesses shut down completely or operated at reduced capacity, others were able to survive or even thrive. Either way, there were valuable lessons learned and, we hope, a renewed sense of purpose and optimism as we kick off 2021. 

What does the future hold for franchising? We asked some of the thought leaders in franchising to look into their crystal balls and reveal their predictions for 2021. A few common themes emerged: the certainty that there will be growth, top talent will be in high demand, and reactive changes driven by COVID are here to stay.  

 

  1. Cut Through the Clutter
    The outlook for franchising in 2021 will be very different for different brands and will, in my opinion, be very much dependent on how the individual brand performed during the 2020 pandemic. For brands like ours, Wild Birds Unlimited, who were deemed essential and had a product line that was sought after by the end consumer and realized strong system-wide sales growth, the biggest challenge will be to continue to see same-store sales growth and maintain customer loyalty and shopping frequency as consumers hopefully see the light at the end of this pandemic tunnel. It will require different tools and marketing approaches to be delivered and supported, new and interesting products to be developed, and new technology to be even better at cutting through the clutter. 

Paul Pickett, Chief Development Officer, Wild Birds Unlimited

 

  1. Overcome F.U.D with Data
    The franchise industry is poised for big growth in 2021. With people losing jobs, and also taking stock and deciding they want to be in control of their future or get more enjoyment from what they’re doing, people will continue to explore franchising as an option. But with the chaos and change of 2020 and negative stories in the news, people will likely experience F.U.D (Fear, Uncertainty, and Doubt) when considering making a big change in 2021 (such as making a large investment or changing how they make their money). Providing data to support their decision, being transparent about your organization and what it will be like, and connecting them with franchisees, will all be more important than ever to lead candidates through the decision-making process and not let them get stuck.

Michelle Rowan, President & COO, Franchise Business Review

 

  1. Rethink Your Teams
    Businesses have had to re-imagine their people infrastructure and I believe it’s such a great opportunity to re-build teams creatively. Now that most businesses have learned to operate in a virtual environment and leadership has adapted to remote working, they can hire the best people with less consideration on location and more consideration on talent, expertise and skill set. Additionally, I think we will see more part-time contractors and fractional employees than ever before. It allows the employer to save time and money, while bringing on higher end talent and expertise to the team.

Liane Caruso, Fractional CMO

 

  1. Retain COVID Business Models
    Many of the business model changes (curbside/delivery/online ordering, etc) caused by COVID will stick around permanently, while franchisors will also look for ways to “slim down” their franchise offering to reduce costs and add operational efficiencies. Smaller real estate footprints, commercial kitchens shared by multiple brands and serviced by third-party delivery, and fitness/educational concepts operating through online platforms will continue to be a growing trend.

Eric Stites, CEO & Managing Director, Franchise Business Review

 

  1. Embrace Turbulence
    In franchising, it is sometimes difficult to extract great data. You go to a conference and no matter the brand, no matter the industry – everyone is crushing it. Well, in 2020 and 2021, those conferences are not happening, yet, because, well, we are in sales, we are conditioned to always talk up the positives. And, that’s not a bad thing. For 2021, though, development plans and growth will have to be realistic (we are in a pandemic, people). You won’t be able to compare data to 2019 – it was a different world. In 2021, we will also have a new President. So, predicting 2021 is quite possibly the biggest crap shoot possible. However, in franchising, there is one consistency to growth – turbulence. There will have to be a trigger that makes someone say, “Yes, I would like to invest my life’s savings, quit my job and take a risk by becoming a business owner.” When the middle manager’s job is turbulent, it creates this trigger moment. So, the brands that position their story, clearly define the why you/why now, and deploy a smart marketing spend will win. The brands that spend $X in January and suggest the leads aren’t what they want – will, unfortunately, be constantly disappointed (leads take time to mature). –

Nick Powills, CEO, No Limit Agency

 

  1. Invest in Customer Experience
    2020 was a year like no other. Lockdowns, closures and changes in business models caused a scramble in consumer habits and loyalty. In 2021, savvy franchise leaders will invest early in marketing and customer experience to attract more than their fair share of customers re-entering the marketplace. Franchisors and franchisees that kept marketing and supported their communities in 2020 are best poised to dominate this year. 

Jayson Pearl, President, ServiceScore

 

  1. Fill the Gap
    We have noticed there are more people looking to purchase a good existing business but the challenge is they are not finding them. What they are finding are businesses that lack good written internal business systems and profitability, thus seem too risky to buy. So they are pivoting and looking to franchising to bridge the gap. For quality franchisors this a real opportunity for growth in 2021. With more layoffs this should accelerate.

Doug Dwyer, President & CSO, DreamMaker Bath & Kitchen 

 

  1. Double Down on Employee Engagement
    Employee engagement will be a major focus as hiring ramps up again and companies are more open to remote employees. Companies/head hunters will be recruiting/poaching the best talent wherever they are. Employers will need to step up in order to retain their top talent.

Eric Stites, CEO & Managing Director, Franchise Business Review

 

  1. Recapture Customers
    For brands that experienced significant periods of being shuttered, the challenge will be to get back in front of their former customer base who may have changed habits and changed priorities during the past year. Recapturing these customers, coupled with potentially depleted cash reserves, may prove to be a major hurdle for some brands.  

Paul Pickett, Chief Development Officer, Wild Birds Unlimited

 

  1. Keep Thinking Remote
    I think franchisor support will remain remote through at least early summer. There might be some travel, but support will still be electronic/telephonic and in some ways more effective. Without travel, there is more time to read and interpret the financial reports and help franchisees work on the “cause and effect” on their business. Additionally, remote support will aid us in the joint employment perceptions because field support will not be tempted to overreach with the franchisees’ employees. Site selection and brand audits can be done real-time but with distance mobile videos. Removing the travel will also allow field support to be more accessible to the franchisees. 

Mary Ann O’Connell, President, FranWise

 

  1. Tell Authentic Stories

In 2020, most franchise brands had a plan for their consumer and franchise development marketing spend. Come March, most brands turned off the faucet for 3 months (or more), an unprecedented situation in the franchise space. With the turn of the calendar, we have an opportunity to make up for lost time! In this unfortunate year, many brands had to fight like never before. Franchisees did exceptional things to survive, franchisors made the irregular move to stop requesting royalties from their franchise partners. Due to budget constraints across the industry, many of these amazing stories of overcoming the odds weren’t told! 

In 2021, I am seeing a major priority shift to organic traffic! Many brands seem to be sensing the opportunity out there to tell their story (without directly paying for the exposure for them). Strategies such as creative influencer relations campaigns, aggressive media relations pushes, authentic videos and personalized written content will be more important in 2021 than ever before. If you have started to wonder how to appropriately showcase the courage your franchise network showed, screaming it to the mountain tops through organic marketing strategies is the best way forward! 

Zack Fishman, Director of Innovation, Fishman Public Relations

 

  1. Stick to the Profile

There will be a flood of new franchisee candidates… especially for brands with lower-cost opportunities. With recruitment becoming easier, brands will have to be more diligent in identifying their ideal candidates/skill sets. The best brands will stick closely to their successful candidate profile. 

Eric Stites, CEO & Managing Director, Franchise Business Review

 

  1. Don’t Wait for Perfection

“Despite the economic impact this year, brand positioning proved itself to be increasingly relevant, and we were able to establish FASTSIGNS as an essential business in April, well before the Federal Government recognized signage companies and signage workers as essential in July.. With our support and guidance, our FASTSIGNS centers pivoted their business models to provide everything from COVID-19 signs as well as PPE, safety shields and intubation boxes. We even pivoted to direct-to-consumer products, a big change for us as we historically have been 99% B2B. In 2020, we learned the value and importance of adding new products and services as well as marketing and advertising support very quickly. We even created new TV commercials in-house to get them airing quickly so our TV messaging would remain relevant and current as the situation changed. One lesson from the pandemic: go fast and don’t get slowed down by the desire for a polished program or perfection. We’re fortunate to have great franchisees and a business model that allows our franchisees to quickly respond to whatever their communities need most, and FASTSIGNS is positioned and ready for 2021 with the combination of new business in addition to our core business.” 

Catherine Monson, CEO at Propelled Brands, the holding company of FASTSIGNS International, Inc. and NerdsToGo, and Chair of the International Franchise Association

 

  1. Find Your Next Generation of Rock Stars
    2021 will be an amazing year for franchise development and growth! The franchise brands that will grow the most will be those who engage with all-new candidates. It’s time to move past the same 60,000 names that are already in every database from purchased lists, portals, and 5 year old events. The next generation of business owners probably have not yet discussed franchising with you or other brands. It’s time for new conversations with people who don’t visit the usual sites but are alive and engaged on Facebook, Instagram, LinkedIn, and other social channels. 

Also, anyone who is bold enough to start a business or invest in a franchise in late 2020 or 2021 will be a superstar! They are bold entrepreneurs who will be your top franchisees three years from now! 

Jack Monson, Chief Revenue Officer, Social Joey

 

  1. Adapt Technology
    Franchises in every industry will need to adapt to the changes we’ve experienced this year. Our businesses are all going to be impacted by technology, if they haven’t been already. Consumer buying behaviors have changed. Is this our new normal? Or will consumers revert back to a more traditional way of purchasing? Only time will tell, but regardless, 2020 has shown us first-hand how imperative it is that we are offering prospects the opportunity to buy online. As a franchisee or franchisor, if you haven’t thought this through…it’s time to do so!

Jennifer Lemcke, CEO, Weed Man 

 

  1. Embrace Hyper Transformation
    2021 is clearly going to be a year of managing Hyper Transformation as we start to transition into the post-pandemic landscape. We can expect several of the rapid changes “transformations” businesses made in the past year to carry over and become more refined, meaning franchisors will need to find an even deeper alignment with their franchisees on specific goals and the resources needed to maintain success. Yes, one of those carry-over trends will be further refinement of remote work and shared office spaces through more efficient virtual trainings and meetings. Paying close attention to legislative developments and proposals will be essential this year. In summary, we will be balancing traditional systems with new technology and workforce trends along with changing compliance rules for at least the next 12 months. Businesses learned to adapt and survive when tossed into an unfamiliar world. Now, the goal will be to take those lessons learned and find what works for long term success.

Sean Manning, President & CEO, Payroll Vault Franchising

 

  1. Access Capital
    From a Franchise Development standpoint, access to capital will be the biggest issue to address for many brands. If a brand does not have strategic financing partners in place, I am of the opinion that this should be Job #1 for the Fran Dev team. Without having a clear way to get your new franchisees funded, it really doesn’t matter how great your FD marketing or process is if you want to grow the number of units in your system. 

Paul Pickett, Chief Development Officer, WIld Birds Unlimited

 

  1. Invest in Business Coaching
    2021 will be the year of coaching. The field team, including Franchise Business Consultants (FBCs), will focus on strategic issues such as business planning. As a result, franchisors will need to hire FBCs who are not just compliance-driven form fillers.

Instead, the person you want on your Field Team in 2021 is business trained and may have been a franchisee at one point themselves. The rise of the multi-unit operator drives more strategic conversations as well. Since more visits will be virtual, there is less time spent on travel and more spent on the everyday grind of working at a desk. Franchisors will want to enable their team through centrally managed technology. 

In this new environment, every state and city is responding differently in terms of lock-downs and stay-at-home measures. This complexity makes life more difficult for a centrally planned franchisor. Many franchise executives have found themselves listening more than ever to franchisees about local trends, and that trend will likely continue. 

At the tail-end of the year, we should start to see some more stability. There will be some things, such as the increased delivery culture, which are here to stay. Overall, 2021 will be a time to reflect on the lessons learned as we all move forward together into the future. 

Stefania Sigurdson Forbes, Senior Director of Marketing & Customer Experience, and Jason Kealey, President, FranchiseBlast

 

  1. Offer New Ways to Learn
    The biggest impact on franchising in 2021 will be building on the newfound comfort with technology that franchisees have, due to the COVID-19 pandemic. Zoom, Microsoft Team, etc. will continue to transform how franchisee and franchisor interact and will have a lasting impact. Communication through these new channels will improve, and the need for live site visits will diminish. We will also see eLearning become increasingly more popular and widely used.

Evan Hackel, President, Ingage Consulting

 

  1. Don’t Count on Live Events
    Live events will start to return in late 2021… but at a fraction of their size. Vendors/salespeople will be anxious to attend in-person events, but attendees will be slower to return.

Eric Stites, CEO & Managing Director, Franchise Business Review

 

  1. Put Relationships at the Heart of Everything

As challenging as this pandemic has been, it has provided a unique opportunity for us to connect with each other and with the families we serve far more deeply than if there had been no crisis. The pandemic has illustrated the power of building meaningful and lasting relationships.

As we look to 2021, my prediction on what will make the biggest impact on franchising is a return to the fundamental building blocks of all good relationships – respect, commitment, and trust. We strengthen relationships by being proactive and transparent about issues; following up quickly and thoroughly when others call for help; delivering on promises made; refraining from approaching relationships as transactional in nature; and having the courage to speak up when you see others making short-sighted decisions. As franchisors, building, lifting, and sustaining relationships with our franchisees and our end consumers will always be the cornerstone of our shared success. 

Dennis R. Maple, President and Chief Executive Officer, Goddard Systems, Inc.

 


 

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About the Author: Ali Forman

As the Marketing Director, Ali’s role is to educate franchise companies about and inspire them to participate in FBR’s research in order to grow and improve their brands. Ali lives in Maine with her husband and two sons.
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