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It’s been almost 10 years since the end of the Great Recession, and many local communities around the country still need more economic investment and job creation. Instead of waiting for outside parties to come to the rescue, entrepreneurs can help boost their hometowns and neighborhoods by joining an established franchise network to create employment opportunities.
At first glance, it might not seem that franchising would be all that connected to local economic growth. After all, you’re not running a “homegrown” business. But just because you’re buying into a known name or national brand doesn’t mean that you’re not creating local benefits. Franchise owners = small business owners who live and work in their communities, recruiting and hiring local residents to grow their teams of employees. They are not shipping jobs in from another town. They are growing new jobs — encouraging local employment — in their businesses every day.
Franchise locations help drive local economies, according to the 2016 Economic Impact of Franchised Businesses report: “Taking into account the indirect impact of franchised businesses, business format franchises support more than 13.2 million jobs, $1.6 trillion in economic output for the U.S. economy and 5.8 percent of the Gross Domestic Product (GDP).”
With ownership that promotes local communities, franchising creates new businesses that bring new or enhanced products into local markets and add new services to local economies. More than 60 percent of all jobs added annually in the U.S. occur in small businesses, according to the Bureau of Labor Statistics. It is not the major employers, the largest companies in the U.S. who are the main job creation engines in the country. It is small businesses like franchises.
Let’s look at some of the many ways that franchises can support their neighborhoods and communities:
- Boosting local communities. Franchise owners work, live and play in their own local communities. There, they help promote a sense of neighborhood. More successful small businesses mean more job growth, larger tax bases, better schools and expanded services for our communities, all due to small business growth of which franchises are a significant part.
- Increasing business longevity. To thrive, business owners need to be in for the long haul, but sometimes it can feel like the odds are against them. According to the Small Business Administration (SBA), 50 percent of new businesses fail during the first five years. The administrative and marketing support offered by a franchise network with proven back-office processes can increase the longevity of your business, and allow you to truly serve as a local job generator and economic booster.
- Decreasing employee turnover. Investing in local employees pays off in the long run with reduced turnover. An invisible source of financial strain for small businesses, turnover hits the bottom line through lost productivity and costs to recruit and train new hires. The best franchise networks can assist location owners to reduce turnover through best hiring and retention practices.
- Recruiting invested employees. For franchise owners, setting a good corporate example is a great recruitment tool. A business that gives great service, providing a special experience in the local community, often attracts local residents who also want to be a part of it. By being a model citizen and member of the local community, franchise owners will attract and continually recruit new employees.
A franchise location may carry a name with national recognition, but it still employs local people who spend their paychecks in their home communities. Franchising gives local entrepreneurs the chance to build sustainable businesses with real, lasting economic impact.
January 28, 2019 at 07:31AM
Forbes – Entrepreneurs