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How Covid-19 Will Change Our Franchise World


Mark Siebert

Illustration by Jonathan Hankin

Just a few short months ago, we were sitting in our stable homes when, without warning, we were picked up by a twister called COVID-19 and dropped in a strange and distant land where businesses are told to close and people are paid to stay home. We feel like we are in a dream, the scary kind.

As a franchisor, this new land feels like nothing you have ever seen before. The economy, which felt stable and safe, suddenly feels twisted and menacing. And even as the world tries to return to normal, our masked and socially-distanced customers are unrecognizable—reminding us that we may need to focus on our business model and not on expansion in the short term.

But while this new land is certainly different, for those whose business models continue to thrive, and for those who have adapted well, there will soon be short-term opportunities for franchise expansion like never before.

Loans and layoffs and bears, oh my

By early May, almost half of small businesses in the U.S. were looking for financing through the SBA’s Paycheck Protection Program, revealing that such assistance was critical in keeping their businesses open. Unemployment rates have risen to the highest level since the Great Depression.  And the once high-flying stock market went from bull to bear in less than two weeks, costing Americans and their 401k accounts trillions in the process.

So why the optimism about the resurgence of franchising? While we have not seen a pandemic like COVID-19 before, we have seen time and again how franchising lands even stronger after the most frightening circumstances pass.

As businesses continue to return to something resembling normal, there simply will not be enough jobs left intact at the high end of the market to meet the demand of returning employees. Many of these formerly employed will look to follow a different road than traditional employment and, for many, owning their own franchise will be the answer.

Perhaps they have a severance package, home equity, a 401k, or other savings to leverage into a business venture. And these buyers will also be aided by an abundance of low-cost money made available through government programs that, during an election year, continue to remain a virtual certainty.

And these franchisees will have other advantages as well. In some markets, they will have access to prime real estate available at much more favorable rates than they could have negotiated a few short months ago. Labor shortages that might have made their lives more difficult in the past will now be readily overcome. Vendors to the franchise industry will be willing to cut deals like never before as they try to recoup losses from the last few months.

Realistically speaking, the future may not be all lollipops and good witches for everyone. The new world order will impact the long-term viability of some business models, and work will be needed on other models for them to survive. Other businesses will need to hold on to cash just to be sure to survive in the short term, and for these businesses, positioning for the coming boom in franchising is also not an option. 

But you can write it down. There is a boom like we have never seen before coming at the end of this yellow-brick road.   

A horse of a different color

Of course, you may need to adapt your support programs to provide meaningful assistance to your new and existing franchisees while maintaining social distancing and minimizing travel.   Demonstrate the collective brainpower of your team by considering new methods and processes for supporting your franchisee community. Innovation in support will likely involve better use of technology. So, if you are not already taking advantage of things such as web-based learning, performance dashboards and video conferencing to provide support, the current pandemic should provide you with more than enough incentive.

In today’s world, the way in which you are providing support will become a vital part of your messaging to prospects. Most importantly, you will want to speak to their hearts. Now, more than ever, you will look to ease your prospects pain. Coming out of this pandemic, their fear will be closer to the surface than ever before—so remember that this is an emotional appeal where understanding and empathy play a more critical role in effective leadership than ever before.  Your prospects will be looking for relief from the uncertainty of being dependent on a boss and they will want the ability to control their own destiny with the flexibility they desire.

While future franchisees may be eager to take charge of their destinies, remember too that their nerve may be lacking due to our collective anguish. It is this basket of emotions that your franchise marketing materials and messaging must also address in the future. You will need to give prospects the courage that your business model will work in this new world order—perhaps because you have made adaptations to suit the market or perhaps because it was well-suited in the first place. Now is the time to refine your program and tell your story of your resilience and support.

There’s no place like home

A quick trip to Facebook, Instagram or LinkedIn provides a heartwarming reminder of the many contributions that franchising makes every day to the world economy and to the dreams of so many. Time and again, in recession after recession, it is small business in general, and franchising in particular, that consistently leads the charge as the economy turns around. And this time, we will lead a rebound on steroids.

However, you cannot just click your heels and relaunch your old franchise program this time.  Established franchisors will need to make adaptations to concept, marketing planning, support, and messaging to be prepared for the onslaught of leads that will be the natural outgrowth of an unemployment rate of over 15 percent. And for new franchisors whose concepts are well-positioned to take advantage of this market, understand that you will need months to ramp up a new program, perhaps forcing you to make a decision to launch when the skies look the darkest. 

No, the blue skies are not here yet. But it won’t be long until the clouds are far behind us. And when they are, those who prepared now will reap the rewards.

Mark Siebert is CEO of consulting firm iFranchise Group. Reach him at 708.957.2300 or info@ifranchisegroup.com.


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About This Blog

The latest news, opinions and commentary on what's happening in the franchise arena that could affect your business.

Laura MichaelsLaura Michaels is editor of Franchise Times. She can be reached at 612.767.3210, or send story ideas to lmichaels@franchisetimes.com.
Beth EwenBeth Ewen is senior editor of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
Nicholas UptonNicholas Upton is restaurants editor at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at




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