Letâ€™s face it: we all want to win, to be the first to greet the fluttering black-and-white checkered flag. Just as in auto racing, it takes a certain kind of entrepreneur to join in the $1.5 trillion franchise race. But before you leave the pit, you must know the territory.
This year, black enterprise identifies five hot franchising sectors based on accelerated growth and opportunity (see chart). What is unique about our choices is that all can be found in the services sector. And according to Darrell Johnson, president and CEO of FRANdata, an Arlington, Virginia-based company that monitors franchising activity across the country, demand for service-oriented franchises will continue to surge.
“Theyâ€™re following what the economy is asking them to do,” Johnson says. “People are asking for more businesses to service the home and family. So what you have is a lot of service businesses picking up the franchising model because itâ€™s easy to replicate and allows businesses to leverage their brand marketing and advertising programs.” Any one of these sectors may put you on the fast track to profits. Your basic formula for success: find the right vehicle, learn the rules of the road, and burn rubber. After reviewing the landscape with the International Franchise Association (www.fran chise.org), we found five areas that will put you in the driverâ€™s seat:
Specialty/Gourmet Foods (Retail Foods)
Entrepreneurs with an appetite for growth should look to the specialty/gourmet food sector. According to a 2007 National Association for the Specialty Food Trade (NASFT) study, this segment took in $38.5 billion in retail sales in 2006, a 13.1% increase from 2005. Burgeoning consumer demand and an array of specialty food products have been primary contributors to sales growth.
“Manufacturers are making it easier for people to have a high-quality meal,” says Denise Shoukas, NASFTâ€™s communications director. “Whether it is prepared foods in a store or the make-your-own-meal [stores], it just makes it so much more convenient for the _consumer. And they can have a restaurant-quality meal at home, so that helps too.” FRANdata listed nine specialty/ gourmet retail franchises among its top 100 (culled from information about 800 franchise brands and based on unit percentage growth for 2006).
Shoukas says franchisors realize the profit potential in reaching food aficionados. “People are looking for higher quality experiences with food,” she says. “And thatâ€™s based on interest in healthier foods, things that can enhance their lives.”
Nikki King-Martin of Hanover, Maryland, co-owner of two My Girlfriendâ€™s Kitchen franchises, has benefited from this growing trend. She was introduced to this opportunity in July 2006, when the mother of two–Makayla, 3, and Malani, 19 months–and her husband, George Martin, a 39-year-old computer programmer, reviewed the companyâ€™s Website in hopes of solving their daily dinner dilemma.
The couple discovered a service where customers could purchase uncooked dinners from an extensive menu and then visit a location to assemble the meals theyâ€™ve selected. The store, which has a full-service kitchen, provides customers with all the ingredients to prepare their dishes at an average cost of roughly