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The United States’ economy is looking good. Unemployment numbers are low, and stocks, while volatile, are still doing very well. It’s a good time, overall, even with climbing gas prices and static incomes.
However, the bear-minded say we are destined for a fall before the 2020 election. Negativity and fear are more evident in these days of poor saving habits, high health-care costs, and non-existent pensions. Add to that the potential impact of trade wars, and any franchisee would be cautious.
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When it comes to an economic downturn, franchises tend to fare better than many less agile businesses. And service franchises often ride high, offering owners low overhead that helps keep costs manageable in tighter times. Even better, these franchises are nearly recession-proof because the demand for services is largely unaffected by economics.
Healthcare & Senior Care Services: Regardless of the economy, we are all getting older, and the elderly population is still increasing dramatically. Healthcare and senior care services offer non-medical assistance in the senior’s home at prices lower than formal senior living communities. Services include running errands, taking clients to doctor appointments, preparing meals, and caring for pets while offering greater independence than is possible otherwise.
Automotive Services: Recession or not, we need our cars in order to get to work to pay the bills. Americans are holding their cars for longer as it is, but in a recession, new car sales go down, and people maintain their current vehicle longer. Keep your customers coming back, and reap the benefits of older cars. A recession, while challenging, will only help this franchise sector.
Hair Care: Maybe the demand for specialty treatments will decrease, but hair care is something we can’t do ourselves for the most part, and it needs the human touch. Hair salons offer efficiency for customers while keeping them looking their best. Even better, this type of franchise is often managed by others, allowing an owner to be semi-absent. If needed in a recession, hair care franchisees can work other jobs while earning from their franchise with limited presence in the salon.
Restoration & Home Repair Services: Restoration services are the angels who help after natural disasters, pipe leaks, and mud slides. The client needs this service irrespective of economic conditions. Kitchen remodels may wait for better financial times, but if a tree falls on a roof or a pipe ruins drywall and carpets, home repairs and restoration providers will fare well no matter what the economy is doing. And since insurance pays for many of these repairs, it is not a financial burden to your customers.
Used/Resale Retail Franchises: As consumers look to save a few bucks, resale franchises fare well in down times. From sporting good franchises to used household items, resale stores enjoy prosperity in a recession. Offering good quality, lightly used products can be lucrative in economic downturns. It also helps customers get cash for items you need on your shelves.
We Americans have enjoyed nearly ten good years of a prospering economy. There’s no way to know when a downturn will come, but it’s not a question of if it will happen—it will because the economy must cycle—it’s a matter of when. As you research your entrepreneurial endeavors, consider these service-based franchise models that keep customers coming, even in economic down times.
Anne Daniells is a co-owner of Enterprising Solutions, a professional services firm specializing in corporate communication and financial improvement for businesses where she shares decades of corporate and entrepreneurial experience—including franchise ownership—in her writings on business culture. She has authored hundreds of articles for publications including AllBusiness.com, TweakYourBiz.com, and MSN.com. Reach out via her website for more on where corporate culture, communication, and human architecture collide.