While the world continues to respond to the unpredictability caused by the ongoing pandemic, the resulting trends are unlocking doors of opportunity for the leaders of the franchise industry.
Successful franchisors tend to have the business acumen to predict rather than react to industry trends. By foreseeing trends that are likely to impact your franchise, you can effectively plan the best way forward for your business.
Not only does this offer protection to your franchise from industry disruption, but it also enables you to make the most of the opportunities created by these new scenarios.
1. Consolidate your supply chains
As lockdowns have lifted, demand has rocketed, and supply chains that were disrupted during the global health crisis are still facing enormous challenges and are struggling to return to normality.
This has created turmoil for the manufacturers and distributors of goods who cannot generate or supply as much as they did pre-pandemic for various reasons, including staff shortages and a lack of critical components and raw materials.
Different parts of the world have experienced supply chain issues that have been exacerbated by different scenarios; Brexit has been a significant factor around a shortage of truck drivers. Germany and the U.S. are also battling a shortage of truckers – with Germany also experiencing large backlogs at its ports.
The supply chain is one of the first things we look at in our consultancy work. Our knowledge of this area allows us to create more efficiency for our clients to navigate the disruption. As a franchisor supporting your network of franchisees, you are well placed to review your supply chain once, rather than 30-100 business owners having to undertake the same process.
When you have optimized your supply chain, the reduction of suppliers can have a profound impact. For example, negotiating across five suppliers instead of 30 can make a huge difference to the disruption on your business in the wake of the continued supply chain crisis.
2. Cultivate your brand’s culture
The changing labor market will be an ongoing impact. We may have seen this trend in 2021, but it is likely to continue for at least another year. The pandemic has pushed many people to make leaps of faith and decide that they want a new challenge in their lives.
This has coupled with the disconnect that many workers were already feeling towards specific industries, and has heightened the issue. The problem is not just in a particular region, with many countries worldwide experiencing the problems caused by a shortage of workers.
It matters because it is aggravating supply chain disruptions around the globe, with key industries struggling to regain momentum due to a lack of staff. This disrupts local and worldwide production and supply networks, impeding economic growth and causing product and service shortages for consumers.
As a franchisor, embedding a robust recruitment process and winning culture into your franchise will be vital in securing and retaining skilled staff and franchisees. The market will not become any less competitive, so it is imperative to highlight why your franchise is a serious consideration for both prospective and current franchisees and staff.
3. Utilize the help around you
In every sector, access to qualified people is the number one concern for most businesses. This is not only in the areas of hospitality and care that have been covered heavily by the media, but also it is spreading to typically higher-paying sectors such as finance, I.T. and engineering.
Outsourcing to experts like us and many other B2B franchise brands can offer a solution to staffing in competitive recruitment areas. In a situation where your in-house team can be fluid, long-term relationship building with a B2B brand is a serious consideration.
Not only does it offer consistency in a market where this is not guaranteed, but it also gives you access immediately to an expert who has an in-depth knowledge of the role you are trying to fill within your business. Whether this is business coaching, marketing support or cost optimization, B2B brands offer solutions that can help you navigate industry-wide disruption.
4. Monitor inflation
Inflation also impacts the world of franchising. Employees may ask for pay raises and other amenities to compensate for inflation. This can lead to higher costs for businesses and increase prices further, compounding the issue.
Global companies that trade overseas are heavily impacted by inflation. If inflation is more significant in the U.K. than elsewhere, the U.K.’s goods and services become comparatively more expensive. This leads to a fall in demand for the U.K.’s goods and services.
We have seen massive spikes in utilities like fuel in areas such as Spain and Portugal, killing the sectors that rely on the resource to make a consistent profit. In the B2B space, it is tough – as global strategy no longer covers all regions. An issue impacting one region is not necessarily impacting another region in the same way.
This translates to broader disruption across the globe. In this time, communication and bespoke strategies for different areas are vital in navigating the various market trends.
5. Keep an eye on future trends
Despite our initial hopes emerging from an incredibly challenging 2021, 2022 is not going to be as straightforward as many businesses were hoping for. The reality is that B2B franchises have never been more needed.
Expertise and collaboration are required to help SMEs, whose business potential is crippled by the ongoing pandemic and other socio-political factors. In terms of becoming a member of the ERA network, franchisees will be joining at a point where their services have never been more valuable in the global business space.
As a franchisor, being aware of the ongoing trends that will continue to test their companies, and how to navigate them, will be vital in having a successful 2022.
Arnd has worked in the franchise industry for over 20 years. He started his career with a German retail group, then founded a franchise consultancy before joining ERA in 2007 with a goal of establishing the B2B franchise in the German-speaking and European markets. Today, ERA has around 700 franchisees in over 30 countries in the U.S.A., Europe, and the Middle East