Retail Franchising Feature
Over the last decade the retail industry has expanded and changed to the many demands of the public. Years ago, shoppers had a tendency to be drawn to name brands, and logos that represented importance and wealth. Now, customers are looking for style, convenience and frugality.
The franchising world has been consistently flexible with the mainy styles and requests of their retail shoppers. Once known for huge branding and marketing, retail franchises now explore the many different styles and budgets of customers, as well as trends both in fashion, design, desires and spending habits.
People want quantity over quality in some aspects, but are willing to pay for big ticket items: a pair of rain resistant boots, or a solid thermal winter coat, a vacuum with a long life, or a high end laptop and case. While they are also satisfied with a bag of t-shirts that get the job done, just the same as any high-end brand tee. Shoppers are more likely to fill their cart at a dollar store with everyday items than pay for a well known brand of toothpicks or handsoap, for example
There are very peculiar and fickle buying habits exhibited in the retail world as there are so many styles and considerations to adhere to, but the franchise industry has figured out how to follow spending trends and work directly within it to garner success.
The retail franchise covers a lot of lines of products. Though there is a tendency to think of clothing when considering retail, it can expand to other types of franchises: health and beauty products, furniture and home accessories, even groceries stores are a form of retail, to name a few. The definition of retail sales is essentially just the sale of goods to the public.
However, over time, retail has expanded well beyond simple goods. It’s not just about what people need, but rather what they want.
With the introduction of the internet, the retail market has opened its doors to accessing more buyers and even more products. Some products are exclusive to online shopping, while some sales are only available on websites. Most importantly, online sales have increased access and in turn, more profit. Online retail sales rose to 10% in 2019, compared to less than 2% in the first quarter of 2003 (source).
While online shopping is up, visiting stores for retail needs has decreased. Customers are more likely to visit stores that provide more than one type of good. Rather than hit up a clothing store, that only provides such, they rather visit stores with all their needs met: food, appliances and clothing all under one roof. Nowadays, consumers needs in retail are based on convenience rather than specifics.
When it comes to retail, the new desires and trends of the consumer determine the success of a franchise. Therefore, when considering an investment, it’s worth taking a look into what exactly a franchise is offering and if the franchise has responded well to previous variables that consumers had demanded.
What once was considered a food market, is now so much more. Chains have reacted to the desires for one-stop-shop. Aisles that used to be filled with canned goods, boxes of cereal and pasta sauce are now filled with health and beauty products, children’s toys and even clothing lines. Grocery store franchises have responded to the needs of its customers and extended sales revenue beyond food. Increasing profit by addressing other retail desires, the grocery store is a good investment.
When reviewing the grocery store options, a good understanding of the direct competition is necessary but also a list of the many services offered helps determine the rate of success. Pick up services are popular, so customers can avoid going into the store to pick up groceries. While online shopping for clothing and other products are an option in some stores, all options broaden the breadth of consumers and could lead to more profit. However, more services could create more work and expectations, which might not create the work-life balance a franchisee is seeking.
The average person spends $161 on clothing a month, meaning there is some buying power behind clothing retail franchises. During the recession, a lot of clothing stores failed to keep up with the demand, while others survived the drought and managed to not only provide trends, but also budget-friendly options to survive the demands of the economy. Since then, clothing stores without large price tags, but stylish options have become more popular. People care less about logos, and more about affordability.
When looking at franchises specializing in clothing, it’s wise to consider all genders and children’s options as well. Since shoppers enjoy shopping in one location, the more products offered within a franchise the better. Being able to get everything for the whole family in one place is appealing to customers, and gains more profit in the long run. It’s important to have women’s clothing as they spend closer to $150-$400 monthly and spend approximately 76% more than men on clothing.
Again, does the store provide good online services and how do the online sales impact a franchisee directly? Some franchises offer the option to have clothing shipped directly from a store location for online purchase, to which the franchisee benefits from the profit.
Consignment and Second-hand Stores
With climate change on the rise, customers are more conscious of their carbon footprint. People are willing to look for used goods instead of constantly buying new products and attributing indirectly to global warming.
Though what might seem like a smaller scale operation, secondhand good sales reached over $1 billion in the US by August 2019 (source). Franchises have recognized the profit and business opportunity in second hand goods with great scale stores providing the many needs of climate conscious and frugal shoppers. What was once monopolized by charities and small business owners, is now a growing business opportunity. The benefit of a franchise is the operations, marketing and branding. A secondhand goods franchise has templates for success to gain profit from lower ticket price items and a reputation that customers recognize.
Overall the retail franchise offers many opportunities, those passionate in fashion have many clothing options to consider - from high end to second hand goods that appeal to many different customers. To run a successful retail business and adhere to the variety of desires from the public, a franchise can guide investors in the direction that the consumers want and will keep up with the ever changing trends.
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ABOUT THE AUTHOR: After receiving an English Degree, followed by a Journalism Diploma, Gina Gill became a freelance journalist in 2008. She has worked as a reporter and in communications, focusing on social media. She currently works as a community information officer with Epilepsy Society, while pursuing her writing career at the same time.