Franchise sector in good shape with gyms boom
A BOOM in fitness and elderly care homes franchising is under way, say experts, amid strong growth in the franchise industry overall.
Franchising has traditionally been associated with international fastfood companies, such as McDonald’s KFC, Subway and Starbucks, which dominate British high streets.
But Rufus Bazley, of website Busi-nessesForSale, said: ‘Franchising is becoming a lot stronger in the UK. It has always been an American-led industry, and five years ago it was probably a less well-known way of becoming your own boss. The general feeling behind it was: “If it’s such a great business model then why aren’t they doing it themselves?”. It had a stigma around it.
‘People were also less aware of the support you get, not just for fast food but for some of the tech companies in lead generation.’
BusinessesForSale has included franchises on its site since 2006, including the likes of McDonald’s, Subway, Broccoli – a pizza business from the UAE – Fit4less gyms and estate agent Century 21.
Pip Wilkins, chief executive of the British Franchise Association, which is supporting the International Franchise Exhibition at London’s Olympia on January 20 and 21, said: ‘Fitness has been a big growth sector and Anytime Fitness has been really fast-growing, not just here but around the world. But the biggest growth sector over the past five years has been domiciliary care, with the likes of Home Instead, Right at Home, Heritage Healthcare and Clarriots Care providing care for the elderly in their homes. Before that it was kids’ classes.’
According to the BFA, more than 900 brands operate in Britain, with a turnover of £15.1billion. There are 44,200 franchisee outlets, employing 621,000 staff. The percentage of profitable units, including new busi- nesses, is 97 per cent. Just 20 years ago, turnover was little more than £5billion. There were 379 brands and 18,300 outlets.
Wilkins said of the next survey, due out mid-year: ‘We expect to see growth again. Of the brands that aren’t yet expanding, one in nine would consider doing it in future. People want to be seen as a global player, they want to have the kudos of being an international brand.’
She said of franchising: ‘It’s a growing sector. It’s grown year on year. Banks heavily support you if you’re franchising, they will lend to robust propositions. The hardest thing is the outlay that franchisees need to make and the premises. It’s not easy to find premises for gyms, so that will normally be a barrier to growth, but it’s been easier to access premises and funding recently.’
Anytime Fitness now has more than 100 gyms in the UK, the fifth market in the world to hit this milestone. Head of franchise development John Kersh said: ‘We expect this to grow to more than 500 locations within five years.’