Many Opportunities with Business Service Franchises
Business services franchises are among the largest and most diverse categories within the franchise community. They provide a wide array of services for both businesses and consumers that can range anywhere from painting to staffing to IT support or printing services.
According to the most recent Franchise Business Economic Outlook report, there were 106,936 business service franchises in 2019, which generated $106 billion. Business services was the third largest sector, accounting for 13.4 percent of all franchise establishments, trailing only retail food, products and services (20.1 percent) and personal services (15.8 percent).
Some business service franchises operate exclusively in the business-to-business space. They provide a set of services that can only be used by businesses. Express employment services, which is a billion-dollar industry, is an example of that. So are sign-making franchises, market research companies and data-processing services.
Each of these businesses help other small, medium or large businesses keep their operations running smoothly and successfully. Some of these service franchises, such as a sign-making or printing business, work from a retail location and involve some production manufacturing. Others, like accounting, HR or sales support, may operate from a small office or home.
While many of these franchises perform services that are essential to business entities, it is important to know that a large number also serves individual customers as well. One example is a painting business. In this case, they cater to both groups as homes and businesses need to be painted. For franchises like Certa-Pro, much of their business is split evenly between B2B and B2C customers. Electricians and plumbers are examples of other service-based companies that do business with both groups.
As a franchise coach, I work with many people who are exploring business franchises and they don’t realize that B2B can be a large component of their business as well. They only think of the retail storefront or person behind the counter serving customers. That may come from their own perspective of being a customer of those services. Once they understand this additional, large business segment exists, the franchise opportunity becomes even more attractive.
Like many other franchisees, owners of business service franchises do not need to have prior industry experience. A good franchisor will provide the franchisee with the proper knowledge and experience in the field they will need to be able to run the business. The franchise owner will hire and oversee employees to do the day-to-day work while they run and grow the business.
Business-to-business franchises work across multiple sectors. They operate in retail locations, offices, warehouses and home-based locations that are exclusively business to business. Whether someone owns a B2B or B2C franchise, one of the most important skill sets they must possess is being comfortable in interacting with others. To grow the business, they will need to get out and build relationships with their customers.
One difference between B2B and B2C formats is that most business-to-business franchises require greater comfort with proactive relationship development. Although there are exceptions, pure marketing-based businesses are more likely to be found on the business-to-consumer side. For B2B franchises, one needs to be comfortable building strong B2B relationships.
Some of the work that is required involves building an identity and reputation to let potential customers know about the business. It is also being willing to call people and tell them about your services, take them out to lunch and start to build relationships. When I work with future business owners, it is important to discover if the individual feels more comfortable building B2B relationships or are more at ease in a B2C environment.
As you would expect from a segment of its size and diversity, the outlook for business service franchises is very good. There is a constant need for their services among a wide range of customers and the number of franchises in the area continues to grow.
One advantage in owning a business service franchise is being able to provide a product or service that remains in demand. As a result, sales are impacted less by current economic conditions. The need for a plumber, exterminator or office IT support does not change if there is a pandemic or recession. These businesses are much more stable than those in industries like restaurants, health and fitness and personal care, which suffered the most over the past year.
I recently spoken with a number of business service franchises and they all had very successful years in 2020. Like everyone else, they experienced several months in which business slowed and they were unsure of what was to come. After the situation stabilized, the second half of 2020 was very strong year for a lot of these franchises. In some cases, they were able to increase their business over the previous year.
There are many types of business service franchises that provide a wide range of products and services. If a prospective franchisee has the proper skill set, determination and comfort level of growing their business, there are many outstanding opportunities to create a successful career in this franchise space.
Rick Bisio is one of the countries most respected franchise coaches and author of the Amazon best seller, The Educated Franchise - 3rd Edition. Since becoming a franchise coach in 2002, Bisio has assisted thousands of aspiring entrepreneurs nationwide explore the dream of business ownership.