WASHINGTON — After three years of restrained growth, franchise businesses show signs of recovery in the year ahead and the Personal Services category—which includes laundry and dry cleaning services—is pegged as the growth leader, according to a report by IHS Global Insight for the International Franchise Association (IFA) Educational Foundation.
Personal Services franchises are expected to be a growth leader, with 6.2% in output growth, followed by Retail Products and Services at 6.1%. Real estate will also show growth of 5.8%, the report says.
Weak consumer spending and tighter credit standards have restrained franchise business growth, the report says.
“The forecast for modest growth is good news for the franchise industry and the overall economy, given franchising supports 12% of the U.S. private sector workforce,” says IFA President & CEO Stephen J. Caldeira. “However, the rate of growth is far below the growth trends we experienced before the recession.
“Pro-growth policies out of Washington to provide certainty to the franchise industry, such as comprehensive tax reform that lowers the corporate and individual tax rates, as well as increasing the flow of credit to small businesses by the lending community, will help to get us on a more aggressive path of growth and job creation.”
The full report is available for download here.