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Starting a Franchise in Uncertain Times

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January is a season of fresh starts and new beginnings. For many, that newness means scoping out the possibility of starting a franchise. Yet, as you take a look at any news outlet’s headlines, you’ll likely start to feel a sense of uncertainty. The economy. Jobs. A possible recession.

If you’ve felt the weight of pausing on your ideas to start a franchise given the current economic backdrop, you’re in the right place. 2023 might be the right year for you to lean into your franchise ownership dreams. To make the right decision for your circumstances, it’s a good idea to look at this from a macro and micro level.


Franchise Meaning

Understanding the State of the General Economy

Contrary to what you might believe as you read headlines of layoffs and slowed growth, franchises have historically done well in these economic downturns. That’s because, as many large corporations are letting their workforce go, many people aren’t leaving the workforce completely. Rather than finding a new job, they take matters into their own hands and start their own business.

Franchising offers the ideal balance between autonomy to make decisions and guardrails to keep you from going off course. This balance allows franchisors to get creative with their approach to attracting customers while not going off course and missing the marketing mark completely. There’s a surge of energetic momentum, stability, and support from the corporate office.

With that said, not every industry is created equal. Do your due diligence to find a franchise that will work well in your area. Things to look for when considering franchises from a macro point of view are density in your current market, the type of systems you get from the corporate office, and other indicators of success in your area. The goal is to know that you’ll have enough leads and customers to help you get your franchise off the ground and generate consistent revenue.

Understanding Your Personal Economy

For many, the macro-economy isn’t the only uncertain thing. It’s also their economy on a micro level, their personal economy. Uncertainty around financial futures has prompted many to consider starting a franchise to support their family. If that’s the case for you, there are a few things to consider before diving into franchise ownership.

A franchise investment takes some time to recoup. Knowing how long of a financial runway you have can help you determine which franchise to start based on how quickly you can start making sales.

Likewise, setting a budget on how much you’ll invest into your franchise from your personal savings will help keep your confidence high. You’ll know the risks you’re taking and can operate accordingly. Having this budget will also help keep you from falling victim to shiny object syndrome, so you can keep your purse strings tight and only open them strategically.

What to Look For When Starting a Franchise in 2023

If you’re ready to dive into franchising in 2023, there are a few things to look for before you choose which franchise to enter.

Find a franchise with a proven business model. Not only will this help you gain funding, but it will also help you gain confidence that the business model you’re pursuing can withstand some economic ebbs and flows.

Look for a franchise that offers support and networking from the corporate office. This networking will help you expand your business and avoid common pitfalls hindering your growth.

While no business model is totally recession-proof, starting a franchise in an economic downturn has proven that it can be a sound investment. Franchising not only gives you the freedom to grow but also backs your endeavor with the systems, tools, and strategies proven to work for other locations. Committing to consistency and leaning on the corporate office for tools will help you get off the ground faster, so you can start your franchise more confidently — even in uncertain times.

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