Covid and its impact on the Franchise Sector
The business challenges due to the direct and indirect impact of Covid-19 in every country across the world due to Covid-19 have been severe. Even now, over 18 months after the first of Covid-19 rose to become the new world paradigm, the pandemic is still creating challenges for everyone, in every sector. However, the franchise industry has shown amazing resilience both in times of recessions and hardship. A franchise business remains strong and is continuing to grow in spite of what 2020 has thrown its way.
Resilience is not the Franchise industry’s only quality; it is reliable, too. Since the onset of the pandemic, the franchise industry has been hard at work providing its franchisees with new, more robust support and resources, in general franchisors stood up to the challenge of developing innovative solutions, adjusting the franchise fee, solving problems thrown at them by the pandemic one after another. Independent business owners may not have the opportunity to quickly pivot and develop new business strategies. Through systematic and increased communication and information sharing, the industry has created a more connected network of franchises in Singapore.
Braving the Storm Together
Many Singapore Franchise owners in the F&B sector went out of their way to assist their Malaysian franchisees who were under Movement Control Order (MCO). The stores continued to serve their customers by expanding and designing E-menus that would comply with Halal Standards.
Joe & Dough responded swiftly by assisting their franchisees to negotiate with the landlords, offer more take away products and set up delivery options with delivery platforms. This is to ensure the stores could get through the Circuit Breaker imposed in Singapore. When the curbs were lifted, Joe & Dough immediately went about training their franchisees on the New Normal and how to maximise their sales despite the safe distancing measures. Almost all of Joe and Dough Franchisees saw their business increase as customer’s spending habits changed and started to stay in the suburbs more. Even in the early days following the pandemic potential, franchisees started to enquire about franchise opportunities of this thriving brand.
Other Singapore franchisees in the fitness sector enjoyed a huge surge in the uptake of their services. Whilst fitness has always had an initial strong following, consumers have been taking up fitness programs like never before. Whether in boutique gyms, Yoga, Spin Cycle, or Boxing, fitness has enjoyed strong consumer uptake. This bodes well for fitness franchises like Jal Yoga, Breathe Pilates, Fight Zone, Spartan’s Boxing, or even self-regulated gyms.
Qualities to look for in Franchise Opportunities
The pandemic brought out the good and bad sides of everyone, including franchise opportunities. Aside from looking into how a brand took care of its franchise units, you can also look into the following info to guide you in what to look for in a franchisor.
Does the brand have Multiple Revenue Streams?
Jal Yoga offers not only in-studio experiences but also makes available to the time-poor customers the omnichannel experience. From a franchise perspective, Jal Yoga offers franchisees the benefit of not only their operational know-how and expertise in the training and certification of teachers but also the benefit of sharing their deep experience as pioneers in therapeutic Yoga. Aside from this, Yoga, pilates, and barre is offered under one roof
Are you happy with their Excellent Products?
It is not enough for a product to be popular for you to invest in it. you have to believe in the product. Joe & Dough is the perfect place to enjoy the simple pleasures of handcrafted coffee, wholesome sandwiches, homemade cakes and pastries with home grown ingredients. The Joe & Dough’s difference is not only in the coffee but also in the passion and sincerity in everything that they do, from sourcing quality Arabica beans to insisting on baking all their artisan breads and patisseries daily at their own bakery.
Are they Customer-Centric?
Franchises have the connotation of serving the masses and not customer-centric. A gym for example, you wouldn’t expect a gym to be bespoke to each member. Fight Zone is different, as a fitness franchise. Fight Zone respects that each member has different needs and concerns and thus, their services are customized too. Franchise brands scale customized services well because they have a system in place. With a strategy in place, putting customers first can be done with a franchised brand.
COVID-19 has created new opportunities
Businesses can now startup for 50 to 80 percent less capital than they would have in better days, opening in low-cost conversions of shuttered businesses or with smaller footprints. Smart investors take advantage of the great real estate deals and available labor force to grow their businesses. Although Covid 19 has been very challenging for some businesses, it has also presented new opportunities for franchises in Singapore that have pivoted and innovated in time.
More location Choice
This is somewhat time-sensitive but Covid 19 has forced some businesses to shut their doors. These are businesses that do not have strong fundamentals or those that cannot easily and quickly pivot. This opened up the possibility of ideal real estate to new franchise entrants that may never have been available previously.
More private equity and professional investors in Singapore see franchising as a way to earn steady, predictable revenue and profits. Investors can witness the snowball effect of compounded returns resulting from an investment that generates enough profit to reinvest successfully. More investors will see franchises as a self-perpetuating investment that generates profit to meet their long-term wealth-building goals.
Franchise Management Technology
Desperate times, Digital measures. The pandemic gave rise to advanced Franchise Management Technology platforms to ensure more efficient implementation of the franchise onboarding, training, and audit. Franchisors who take their franchisee’s business sustainability seriously invest time, money, and effort to develop a Quality franchise operations management system. Access to this technology is important to ensure their unit owners are effectively onboarded and are on track to franchise profitability in the shortest time possible. In the last year, many Singapore Franchises have implemented franchise management operations technology to improved their oversight on their franchise system despite Covid 19, receive real-time data in order to make value-added business decisions to help their local and regional franchisees maximise their resources.
Time to be your own boss
The old concept of an iron rice bowl that guarantees a lifetime of job security and employment no longer exists. During recessions and tough economic conditions, business realities descend and employment can become rather transient. One way to help shield yourself from the effects of a recession is to be your own boss. There is also the benefit of knowing you will keep more if you bring in more. The sky truly is the limit when you own your own business.
While recessions can be challenging for many businesses and industries, franchise systems typically perform better than a stand-alone store. This is because franchises have more scale and resources to engineer solutions faster.
Many have seen a change in their daily work-life patterns. People who used to travel weekly and never stayed in one place long enough to start something for themselves may find this the ideal window to start a new business venture. People who were sadly made redundant may finally take this opportunity to become their own boss. With franchising, you are your own boss but can leverage the experience and know-how already developed by your Franchisor. If this has been your secret dream, this could be the time to seize the day and give business entrepreneurship a go. If not now, when?
How to Start
You may have caught yourself looking through franchises in Singapore in online Franchise Directories like Top Franchise Asia. This is one of the tell-tale signs that you are ready. However, an interest in a brand doesn’t equate directly to success. Choosing the right franchise isn’t easy and shouldn’t be taken lightly since it is generally a large investment. When you’re looking at a franchise, the most important question may ultimately be: “Do I fit in here?”
These questions may help you:
- What is the right type of franchise for me? Home-based or brick and mortar? This may depend on the cash you have available to invest.
- Do I want to run a service-based or product-based business? It’s a personal preference.
- Would I prefer to focus on B2B or B2C sales? Again, that’s a personal choice.
There is no one-size-fits-all franchise, and no one can tell you what’s best for you. You can ask friends and family for their opinion. You can ask trusted advisers, such as accountants and attorneys. But ultimately, the decision is yours to make (alongside your spouse if you’re married). Don’t purchase a franchise without getting buy-in from your spouse!
If you’re considering making a career change, think about taking the leap into business ownership. On the heels of a pandemic, it could be the perfect time to start fresh and follow your dreams.
Having Second Thoughts?
We totally understand, choosing amongst franchise opportunities can be nerve-wracking because it is a lifelong commitment. That’s why we at Astreem are giving you free access to the Franchise Success Code to check for yourself if you’re ready to be a franchisee and open your first outlet. Simply click on this link.
The Franchise Success Code is a guide to highlight areas you should understand and do in-depth research on before embarking on buying a franchise. A word of caution, make sure you do the necessary research and enlist the right help to make the most successful franchise choices.