For over 16 years, the French Franchise Federation, in partnership with Banque Populaire, has been highlighting key figures from the world of franchising. Several topics are covered in the form of episodes, which we have shared on our social media channels, making this study a true reference in its field. We invite you to take a look back at the key points of this survey.
This year, more than ever, franchise professionals have had to constantly adapt and reinvent themselves in the face of the health crisis and the evolution of consumer habits and digital transformation.
Covid-19: The world of franchising faces the health crisis
The Covid-19 crisis disrupted the organization of many companies. Between closures, the implementation of remote work, and successive lockdowns, it was a major leap into the unknown. The ability to adapt quickly in order to keep working was vital for companies to "survive" and limit revenue loss. Despite everything, franchising remains a source of job creation: 6 out of 10 franchisees have created at least one job.
The advantages of being part of a franchise network rather than an independent business became clear for 67% of franchisees, who believe they were better able to handle the coronavirus crisis, particularly thanks to the support measures provided by franchisors. These measures included more regular communication (87%), the introduction of new digital tools (58%), the development of new services for customers (44%), and more frequent meetings with other franchisees in the network (42%).
During this period, an intensification of communication within networks was observed. This was reflected in at least one visit from a network manager (in 91% of cases). In addition to the measures implemented by the network headquarters, 86% of franchisees introduced specific activities to better adapt to the crisis. Following the deployment of all these actions, one in two franchisees observed a positive impact on their business.
Franchisees are therefore satisfied with the franchise model, and 90% of them would recommend it. The fact that they were not left on their own during a crisis and received support highlights the true benefits of being part of a franchise network.
Who are the franchisees?
The world of entrepreneurship is increasingly attracting the French. Indeed, nearly one-third of them wish to start their own business, and 40% are drawn to the independence and security offered by the franchise model. It is worth noting that 72% of franchisees were employees before choosing entrepreneurship, 49% have a high school diploma or less, and 54% hold a degree equivalent to two years of higher education or more.
Trust is key, as seniority plays an important role — 6 out of 10 franchisees joined their network 10 years ago or more.
Why invest in a franchise?
The process of launching a franchise is relatively straightforward, as training takes an average of about 36 days, and being a franchisee generally makes it easier to obtain a bank loan (in 62% of cases).
How much does it cost to start a business?
- 37% Less than €100,000
- 21% Between €100,000 and €200,000
- 42% More than €200,000
This cost may vary depending on the chosen brand and the necessary investments.
Why do entrepreneurs choose franchising?
- The support and resources provided to help develop the business (39 %)
- To benefit from the reputation of a well-known brand (36 %)
- To reduce financial risks (25 %)
Digital technology, a growth driver for franchising
Franchisees are committed to the local economy
Franchising is an important factor in the development of the local economy. Attentive to the consumption habits of the French — for whom fair trade and local commerce have become essential — 3 out of 4 franchisees have decided to set up in their own region and work with local partners.
Indeed, they aim to meet the needs of French consumers who favor shopping at businesses that support local production (66%) and proximity commerce (74%). Short supply chains are highly valued by these consumers, who seek more responsible purchasing options.
To face this unprecedented crisis, 44% of franchisees implemented solidarity initiatives. 63% of these involved franchisees in the food sector.
Franchisees invest in the franchise model
When creating a franchise, the two main professions most frequently consulted for project support are accountants and chartered accountants (70%), followed by banks (in 58% of cases).
The franchise model is highly popular and enjoys great success among franchisees, as 79% of them wish to renew their contract.
Nearly one-third of franchisees want to expand within the same network, and 26% of franchisees operate multiple locations under the same brand.
Women seem more convinced by this model than men, as 85% of them renew their contract compared to 76% of men.
Franchisees remain optimistic about the future of franchising. 45% of them are considering making investments within the next two years.
The main areas of investment
- The purchase of equipment (77%)
- Renovation work (67%)
- New technologies (31%)
- Communication tools (30%)
To conclude this survey, we can affirm that the franchise model continues to be highly valued by both industry players and entrepreneurs.
This is due, among other things, to its reassuring and secure nature, as well as to the reputation of the various networks. Franchising guarantees a certain level of support through continuous training, assistance, and the provision of services and tools. These are optimistic players who continue to invest.
Despite the observed decline in franchisees and networks, this model remains dynamic and continues to grow.
