Solid performances can also be found in the European market - the second largest in the world - a territory of 450 million consumers, distributed across 28 countries, where over 8,500 brands operate. Scrolling through the names of the most widespread and well-known brands, you can notice a strong presence of American companies - primarily those linked to food, wellness and logistics - but from the statistics on franchising it clearly emerges that among the best brands of the old continent, 8 out of 10 originate in Europe. What convinces investors here, even before the important development opportunities, are elements such as the chance to enjoy the advantages deriving from the use of established brands and a reduced business risk compared to that which must be assumed to opening a business from scratch.
As can be seen from the 2023 statistics on franchising, those who choose franchising are attracted by the solidity of the investment that characterizes the sector: as reported by Franchise Direct, 99% of those who choose this business model pass the startup phase of the first 12 months, while one in two independent businesses, according to what Creditnews reports, closes in the first two years of life. If affiliated businesses demonstrate resilience and guarantee safer investments, it is equally true that their fortunes are linked, as for every business, to market demands. Let us examine the most popular trends for the new year. Among the countries recording the most interesting growth rates we find Italy, whose sector recorded, according to what was reported by Assofranchising, a turnover of 30.9 billion euros, with an increase of 7.1% compared to the previous year. Encouraging data on franchising are also recorded for the number of sales points (+2.2%) and employees (+6.2%), confirming the ability of this business model to adapt to the current socio-economic circumstances.
Interesting numbers also come from Great Britain, where the 2023 franchising statistics reveal the great interest on the part of American and foreign brands in investing in a market that remains dynamic and profitable. There are numerous US companies present at the top of the ranking of the Top 100 franchises in the UK: as many as eight in the top 20, almost all involved in the food sector. Even in eastern Europe, the sector is consolidated as a business model to be adopted. In Poland, for example, where the food sector attracts the attention of investors with percentages between +10 and +20% depending on the brand, affiliation is synonymous with stability: according to the Polish Franchise Organization, 80% of affiliates continue to manage their business after 5 years, while it drops to 20% among those who decide to start their own business.
Sector Trends
As already mentioned, among the characterizing elements which brands and affiliates can count on to consolidate and expand their business volume, there is a high reactivity and ability to adapt to new trends. It is very important strategically to identify new trends, both in terms of internal organization and in terms of consumer habits and tastes, in order to maintain competitiveness in the sector of reference.
In terms of the internal organization of companies, it is above all technological innovation, the customization of products and services, the ever-increasing need to operate in foreign markets and eco-sustainability that drive franchising trends. Large brands and affiliates demonstrate that they know how to respond effectively to these demands, thanks to the possibility of being able to count on large networks that share not only know-how but also increasingly new tools and technologies capable of improving both the quality of work and the customer user experience.
Speaking of customers, the trending sectors in franchising for 2024 reflect market evolutions and changing consumer needs. Here are some of the most dynamic sectors:
Technology and Digital Innovation. As technology continues to evolve, brands offering technology-related products and services, such as augmented reality, artificial intelligence, and cybersecurity solutions, are becoming increasingly popular.
Sustainability and Eco-friendly Products. Growing environmental awareness is pushing consumers towards eco-sustainable products and services. Franchises offering sustainable solutions in sectors such as fashion, food, and renewable energy, in particular, are on the rise.
Food and Gastronomy. The food sector continues to be a pillar of franchising, with growing interest in healthy, vegan, vegetarian and ethnic cuisine options.
Logistics and shipping. According to McKinsey, by 2040, 90% of purchases will take place online. The expansion of e-commerce has had a significant impact on the growth of the logistics and shipping services sector, but not only that: online sales have led SMEs to improve marketing strategies and increasingly rely on players capable of guaranteeing quality, efficiency and technology. The brands that operate in this sector are, therefore, among the most dynamic in the current economic backdrop.
Opening a franchise in the logistics sector can represent a fruitful investment capable of responding to new trends. MBE franchising provides a program that provides assistance and continuous training to its affiliates, who can thus count on a network of approximately 1600 Service Centers worldwide. Contact us to discover the solutions tailored for you to start your business.
