Franchising could provide a route back to work in the face of high unemployment
Joel Caws - Technical Director, Select Your Franchise
A few days ago, a news article by the BBC reported that UK unemployment rose to 2.64 million in the quarter to October 2011, its highest level in 17 years. It’s clear that the effects of the recession are still with us for some time yet, with the danger of a double dip recession also snapping at the heels of the UK economy if this and next years quarter see a retraction in growth.
Despite the doom and gloom, many of those who have found themselves unemployed have taken control of their own futures by seeking to start up new franchise businesses. Franchises can give you the benefit of establishing your own business but with the added help of founding it on a proven, franchised business model along with the support and training of the franchisor.
If you are one of those affected by the recent rise in unemployment and facing the difficulties and frustrations of applying for new job vacancies with increasingly greater competition, starting up a franchise business could be your ticket to get you back on track.
If you have come out of a previous position with a redundancy package, then it could be that you decide to invest some of this capital into starting up a new franchise business venture. Though some franchises do require fairly substantial upfront franchise fees, there are others which are also affordable to those with lesser available capital.
Whatever your financial situation or preference, you will almost certainly be able to find a franchise business to suit your needs. There are hundreds of different franchises available in the UK in almost every conceivable industry sector from technology to manual labour, from business consultancy to children’s parties, from office based to home based, from retail store to mobile van sales, the list goes on.
If you want to take control of your future and think a franchise business might be an option for you, you could start by using a franchise matching service which is a quick way to find franchise opportunities that are available in your area and that match your preferences.
HSBC View: How the UK franchising sector has fared during 2011
Cathryn Hayes - HSBC Head of Franchising
There is no denying that 2011 has been a difficult year for UK businesses. The economic recession forced sweeping changes in strategy for many businesses – add to this the change in Government at last year’s general election, increased unemployment and reported lack of available credit and it’s not surprising many firms have struggled.
However, with significantly better success rates than other businesses, the franchise industry is key to promoting job creation, stimulating economic growth and encouraging new start-ups. This is mainly due to the wide spectrum of industries covered by franchised businesses, the strength of the business model and the support provided by franchisors and other franchisees within the same networks.
Nowhere is this success more evident than this year’s bfa HSBC Franchisee of the Year Awards. Financial stability, innovation, creativity and the relentless pursuit of success were just a few traits demonstrated by this year’s finalists.
The overall winners, Mike and Catharine Chalton from Home Instead Senior Care in Wirral, showed that their key success was providing excellent customer service which has resulted in their business going from strength to strength. They are a true credit to the franchising industry, and an inspiration to small businesses across the UK.
So what about finance? Put simply, there is still plenty of funding available for sound business propositions. Your franchisees are in a stronger position than a standalone start-up business because of the help and support available to them. Requests for funding are more likely to be agreed if franchisees present a professional and credible business plan.
This could be the time to think about switching your business. There is often a nervousness that surrounds ‘switching your bank’, for fear of disrupting vital transactions. The UK’s leading banks, including HSBC, have signed up to a banking industry code that means they must make account switching speedier and easier for customers who have made their mind up their mind to change.
We have consistently welcomed new franchise business, and we are confident that by the time 2011′s Christmas trees have been packed away HSBC Franchise Unit will have improved on our 2010 lending figures by 200%.
Posting from the monthly HSBC Connections newsletter. For more information or to get on the mailing list for the newsletter please email franchiseunit@hsbc.com
Tags: cathryn hayes, franchise industry, franchising, hsbc, uk economy
Franchise View: Unemployment hits 17 year high
Carl Reader, Dennis & Turnbull Ltd
Unemployment hit a 17 year high in the three months to August, the latest statistics have shown.
The Office for National Statistics (ONS) released the figures, which show the unemployment rate was at 8.1 per cent, making a total of 2.57 million unemployed people.
The quarterly increase of 114,000 people has been described as ‘horrific’ by Dr John Philpott, chief economic adviser at the Chartered Institute of Personell and Development (CIPD). He said:
“These labour market figures are truly horrific, with the economy shedding almost 15,000 jobs each week between June and August. The quarterly rise in unemployment is reminiscent of an economy in recession rather than any kind of recovery and confirms that the private sector just isn’t creating enough jobs at present to offset public sector job cuts.
“With 5.6 unemployed people for every job vacancy the labour market is back to where it was in the depths of recession in 2009 and the underlying problem is getting even worse given that 1 in 3 unemployed people have now been without work for over a year.”
The number of 16 to 24 year olds out of work is now at its highest level since 1992, demonstrating how important it is for the Government to do more to support businesses to grow and employ more staff.
Commenting, Katja Hall, CBI Chief Policy Director, said:
“Today’s unemployment numbers make grim reading, especially for our young people. The continuing rise in youth unemployment is a grave concern for us all.
“Businesses are still creating jobs and only continuing private sector growth can help us out of the current tumult. With jobs falling in the public sector, it’s vital the Government does everything it can to support businesses to grow and create jobs, and help young people get into work.”
With such a stark outlook, starting a franchise business could be a way out for many stuck in the unemployment trap. A franchise is basically a way to start up your own business using a proven business model with the support and backing of the franchisor.
Carl Reader is the head of franchising at franchise accountants Dennis & Turnbull, a leading firm of accountants in the franchise industry.
The above information is provided as general advice and no liability is accepted by the author, Dennis & Turnbull or Select Your Franchise in respect of individuals or businesses acting on the above. Independent advice should be sought in all circumstances.
