Since the Brexit decision, there has been lots of debate on both the short and long-term effect on small businesses. Suffice it to say, it is simply too early to know, but if you are considering launching your own business, is now the right time?
Should you buy a franchise now?
The franchise industry is robust. A recent article published by NatWest revealed that in the midst of the last recession, average turnover figures rose between 2009 and 2010 and 89% of all franchise businesses were profitable. Franchisors surveyed as part of the bank’s annual review revealed that 94% were optimistic about business conditions.
Of course, a recession seems unlikely as a result of the Brexit vote, but it would not be unreasonable to assume that people may be more cautious about their spending, at least in the short term. As franchises can be for fast food, garden services and anything else you could imagine, inevitably some systems will perform better than others. In April 2009, an article on entrepreneur.com considered which business were most likely to thrive when times were bad. Not surprisingly, anything in the children’s sector was considered a safe bet, as parents will always spend money on their kids (and pets).
In post-Brexit Britain, is it a good idea to invest in a new business?
Suzi Woolfson of business advisory and accountancy firm PwC, noted that “We should expect a bumpier economic climate in the short term, but as Mark Carney has commented, we have a resilient UK financial system and the ‘real economy’ will adjust. Private businesses and SMEs are at the heart of the real economy and they are nothing if not resilient, flexible and adaptable. I am confident that they are well equipped to weather the changes.”
The Telegraph’s Matthew Lynn reported in July 2016 that:
- Our start-up rate has accelerated at such a pace that the UK is now emerging as the most entrepreneurial major economy in the world.
- In the past three years, the number of companies has increased by 676,000, to 3,721,493, the highest number ever recorded.
- Britain now has one of the best start-up rates of any major economy.
- Entrepreneurship is now far more celebrated, and not just among the young. One of the fastest rates of growth is in with start-ups founded by those aged 50 and older.
- The vast majority of jobs are created by new small businesses. The more of them you have, the more jobs will be created.
What is always true, Brexit or not, is that the more robust your business model, the better the chance of success. This is why a franchise model is so popular amongst small business owners. Someone else has set up the system, made the mistakes and refined the customer experience. Someone else has invested years and significant sums, so you don’t have to. A franchisee simply needs to follow the system and add their own time, enthusiasm and effort.
Which franchise should you buy?
The MagiKats Maths and English franchise system provides a flexible approach to the traditional education franchise. It can see people operating their local Tuition Centres on a small scale in the local community centre, through to having multiple sites in commercial premises on the local high street. You can even start with one and develop it over time into the other – or not! What is important is the foundations of the network – which are solid and come from decades of teaching and small business experience. It is a continually evolving business too, from the re-launch of this blog and the website last year, through new marketing materials, to new programmes for Key Stage 2 SATS and GCSE exam preparation.
Does this sound like a business that is preparing to pause and wait whilst the Brexit decisions are made? No. It is a business that sees no reason why anything should stop new franchisees coming on board and launching their local businesses to help kids make the most of their education. After all – if things do start to go horribly wrong – what skills will employers value? Maths and English of course.
By Sarah Marsh, MagiKats HQ