The Impact of Millennials on the Franchise Industry
Making franchising appealing to the new wave of entrepreneurs.
By Danny Rivera
Two out of three millennials are interested in entrepreneurship, according to the U.S. Chamber of Commerce Foundation’s report on millennial generation research. According to Forbes magazine, 72 percent of millennials would like to be their own boss. Seventy-four percent want flexible work schedules and 88 percent want “work-life integration,” a switch from work-life balance, as the line between life and work has irreversibly blurred. However, when it comes to entrepreneurial endeavors, franchising is often an overlooked opportunity among this group.
The choice to operate a franchise business can be rewarding, as it comes with the flexibility of entrepreneurship but unparalleled business support in the form of marketing, operations, immediate brand recognition, training and IT support.
The International Franchise Association took note of millennial traits and skills and launched NextGen to close the gap between millennials and franchise companies. Attracting this generation to invest in franchising requires education that highlights ROI, transparent business practices and technology that streamlines business.
Tap into their success-driven nature
Attracting millennials to franchise opportunities requires a different type of education than the industry may be accustomed to. For millennials, success is as much about money as it is meaningful initiatives. Tying franchise opportunities to an ROI doesn’t always equate to a monetary return. IFA’s NextGen program educates millennials about the benefit of franchising by explaining both growth potential and how franchising meets their desire for a flexible, fulfilling lifestyle.
The CT Corporation recently surveyed college graduates and learned that while 60 percent of those surveyed wanted to start a business post-graduation, 67 percent lacked the know-how, 45 percent didn’t think they could come up with a name and 30 percent were not knowledgeable about how to market the business. Franchising creates the perfect solution to these issues, marrying millennial desire to operate their own businesses with tried and true best practices for success.
Transparent business practices
Millennials grew up in an age of diligent online research and product reviews, and are unlikely to make any large decisions without trusted recommendations. Utilizing relatable and genuine testimonials from current millennial franchisees in your system can be the emotional and trusted connection a prospective franchisee needs to make a decision.
In focus groups conducted in 2015, Meineke learned honesty is one of the leading traits that drives customers to select a car-care partner. This drove Meineke to ensure consumer transparency is at the heart of how we operate. Millennials take note of companies that treat their customers well and would look to align themselves with a business with transparent, proactive practices that meet the needs of today’s consumer.
Utilize technology and customer-first positioning
All franchised businesses benefit from having an owner with strong tech skills -- even car-care franchises. Millennials are notorious for their innate ability to master technology and franchised businesses would do well to capitalize on this skillset from the growing base of millennial franchisee prospects.
Businesses should cater business opportunities to millennials directly through their communication vehicle of choice: technology. Creating new avenues for millennials to directly engage and communicate with your brand on a personalized level is essential, as evidenced by the custom website IFA created for its NextGen initiative.
Other examples include rewards programs like Meineke Rewards. While consumer facing, the program is a promise to franchisees that you will improve loyalty among customers and marketing to them in a more personalized way. In addition, the innovative use of technology to solve customers’ needs, indicates a forward-thinking organization and presents the perfect intersection of technology and long-term commitment to consumer needs.
The 80 million millennials in the United States control a vast amount of purchasing power and hold a deep-rooted desire to start a business they can call their own. As their influence continues to grow, it is vital that franchise-based businesses continue to learn about this generation and cater opportunities to their innovative and entrepreneurial spirit.
Danny Rivera is president of Meineke Car Care Centers. Find him at fransocial.franchise.org.