[All the information is taken from the International Franchise Association’s 2024 Franchising Economic Outlook]
There’s no doubt that we were faced with significant economic challenges in 2023 – from rising inflation, labor shortages, and high interest rates. Many of these difficulties remain in 2024. However, even in an uncertain economy, franchising has proven itself to be a robust and profitable business model that’s expected to see continued growth.
Where in the United States Will Franchising Grow the Most in 2024?
While all regions are expected to see growth in 2024, it’s likely that the southeast and southwest regions will outpace the rest of the United States. These areas have experienced the most population and industry growth.
Currently, the southeast region “is home to approximately 30% of all U.S. franchised businesses” making it the leader for the most franchised businesses in the country. The midwest follows as the second-largest region.
When it comes to individual states, Texas continues to be the top state for franchising and has been for the last three years.
THE TOP 10 STATES FOR FRANCHISE GROWTH IN 2024
- Texas
- Florida
- Georgia
- North Carolina
- South Carolina
- Tennessee
- Maryland
- Arizona
- Colorado
- Virginia
Which Industries Are Predicted to See the Most Growth in 2024?
It’s expected that personal services and quick service restaurants (QSRs) industries will see the most growth in 2024.
#1 – Personal Service
Personal services are “services related to beauty, health and fitness, storage, moving, education, childcare, sports and recreation, pets, and travel”, and they are expected to grow by 3.0% in 2024.
Why are they projected to grow?
During the COVID-19 pandemic, various restrictions created a pent-up demand for services such as luxury spas, salons, nonsurgical skincare, specialized hair services, and more. Now that we’re in a post-COVID era, these beauty-related services have rebounded as consumers are placing a strong emphasis on personal health and wellness.
#2 – Quick Service Restaurants (QSRs)
QSRs include “limited-service restaurants that serve meals at lower price points and typically provide fast service, a limited menu, and limited table service”, and these establishments are forecasted to grow by 2.2% in 2024.
Why are they projected to grow?
There is an increased demand for units with smaller footprints due to rising real estate costs and the cost of buildup. Restaurants with drive-thrus tend to fit these parameters causing the “initial investment cost to fall to less than $500,000”.
Additionally, there is an increased consumer demand for fast food and take out as “approximately 21% of new concepts were categorized as QSRs”.
Looking to Purchase a Franchise in 2024?
If you are thinking about starting a business, then you should definitely consider franchise ownership. It offers many advantages over starting your own business from scratch, one of which is the franchising industry’s resilience even in tough economic times.
At FranNet, our expert franchise consultants will help you find the right franchise opportunity. At no cost to you, they will evaluate your skills and goals, match you with a franchise brand that fits, and then walk you through the process from start to finish. Schedule your free consultation today to get started!