Methodology
The results from our latest Franchise Growth Confidence Index- BoeFly’s quarterly survey measuring how certain economic conditions and external factors affect franchisors’ growth – was recently published in Franchise Times August issue.
Between June 7 – 20, 2024, we surveyed nearly 700 executives of franchised brands from several major industries including automotive, education, fitness, health/beauty, home services, restaurant, and retail. Our goal is to continue analyzing this data to identify significant changes in franchisor sentiment in terms of domestic franchise growth.
As with previous surveys, participants rated their confidence on a scale of 1 (not confident) to 7 (completely confident) about whether they expect their brand to achieve growth targets this year. Additionally, respondents answered four supplementary questions designed to assess the impact of relevant economic conditions on their confidence level.
Results
Overall, less than half (48.6%) of the respondents expressed at least some confidence in meeting their franchise growth goals for this year, marking a significant drop of over 20% from the previous quarter’s combined confidence level of 66.7%. Further insights include:
- A clear majority (77.1%) indicated that inflation has adversely affected their growth targets, up slightly from the previous survey.
- While interest rates and inflation continue to be major economic concerns, the percentage of respondents who felt negatively impacted by interest rates has slightly decreased by 3% from the previous quarter to 80%.
- Regarding labor marketing conditions, 65.7% of franchisor executives reported an improvement in their ability to find and hire strong employees compared to the previous year, though, this reflects a minor decrease from the last survey.
- A new factor highlighted in this quarter’s survey is the impact of the upcoming presidential election. More than half of the respondents (54.3%) reported that uncertainty surrounding the election is negatively affecting their growth projections.
These insights highlight the persistent challenge franchisors face in an evolving economic environment, emphasizing the influence of inflation, interest rates, labor conditions, and political uncertainty on growth confidence.
