How has the Covid-19 pandemic affected franchises? For some the news has been good. For others, particularly newbie businesses trying to forge their way in franchising, the challenges have been significant.
Here five franchisors reveal what the pandemic has meant for business.
How has the Covid-19 pandemic affected franchises?
Tracy Sullivan at Aussie Pooch Mobile reports the dog washing business is one of the lucky ones, seeing its best quarter in the past 29 years of operating.
“We are finding that with more people at home, they don’t want a smelly dog, and are relying on our services even more,” she says.
“We have strict guidelines around working without human to human contact which our franchisees have implemented in their day to day business and it is keeping our business going strong throughout the pandemic.”
Managing director Paul Walters believes the lower cost mobile model makes it particularly appealing now.
“If I look back at the past quarter, the number of franchise enquiries has increased about 5 per cent, and the quality of enquiries is better,” he says.
“People are already armed with the funds behind them and educated about franchising.”
Walters says incoming franchisees are accessing superannuation and because of the low level investment, able to top up with their savings.
Nurse Next Door Melbourne saw a 500 per cent increase in growth since January while brand new Gold Coast franchisees are forecast to hit their nine month revenue target in the third month.
“The increased demand for home care is complemented by people not wanting their ageing parents out doing shopping, running errands,” says Nurse Next Door Australia co-founder Matt Fitton.
“We’re seeing people wanting to get out of hospital and rehab facilities (both aged and disability) as soon as possible to avoid increasing risk of infection.”
Another business seeing a boom in revenue is the Mobile City App, led by Richard Giannini.
“We have been in thriving mode over the past few months. In fact the last three months have been our biggest grossing months since our inception in 2011,” he tells Inside Franchise Business Executive.
“Now is the perfect time to start this business. Our franchisees (licensees, actually) help businesses get more customers and reduce their expenses using the latest mobile and digital technologies.
“Time is of the essence for so many businesses right now. Many are on the brink of closure, but with the aid of the technologies we provide, we have been able to avert closure for many businesses.”
Giannini cites a pizza restaurant on the brink of closure because it was unprepared for online orders.
Within 48 hours of implementing Mobile App City’s mobile online food ordering technology the restaurant was accepting orders online.
“While not at the same level as before, they have kept their doors open and are confident they will see it through,” says Giannini.
As a newcomer to franchising, Hari Shotham at automated mini mart business All Vending has had a really tough start to expansion.
“We suffered terribly, as we entered the franchise market only in January 2020. We’ve had a good number of franchise enquiries, but all of them got too scared to sign on the bottom line, as none of them, is sure if things can get better for a long, long time.”
However Hotham believes All Vending’s 24/7 passive income model offers a low risk option to cautious franchisees looking to improve their lifestyle and work on the business just a few hours a week.
“It’s a pity that fear of the unknown has put a spanner in the works,” he says.
Construction gets boost
The HomeBuilder grant won’t give Refresh Renovations a dramatic lift in recruiting franchisees but it will provide reassurance, says co-founder, Chris Caiger.
“At Refresh, we are always looking to recruit more franchisees, so the HomeBuilder grant won’t have a direct effect on our end. What it will do is give potential business owners more confidence to make a decision and make it easier for them to purchase a new franchise,
“We are going to run several campaigns to inform consumers about this exciting grant and how beneficial it will be for them.
“The industry needs this stimulus during this vacuum. In the long run, as our economy rebuilds, there will be natural steady growth, whereas this grant will help our economy during its lowest point.
“The HomeBuilder grant is the jump-start the industry needs to get back to normal,” says Caiger.
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