This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

3 Things You Should Know About Small Business: March 27

NEW YORK ( TheStreet) -- What's happening in small business today?

1. Franchises continue to grow faster than independent businesses. Franchised businesses will continue to grow at a slightly faster rate than other businesses in terms of job creation, new business formation, economic output and GDP contribution, according to the International Franchise Association's first-quarter update to its economic outlook for franchising.

According to the update, the outlook hasn't changed much from the IFA's initial 2013 forecast released in December.

The IFA amended its industry forecast slightly in the latest report:
  • New U.S. franchised establishments will rise by 1.3% in 2013 vs. 1.4% originally predicted;
  • Franchises will add 156,000 jobs this year to a total of 8.2 million, up 1.9% from 2012, but slightly lower than the 2% originally predicted;
  • Output from franchises will rise 4.2% to $802 billion in 2013, down from the 4.3% initially forecast;
  • The gross domestic product of the franchise sector is projected to rise 4% to $472 billion, down from the 4.1% initially forecast for 2013 and lower than the 4.6% growth in 2012. This is approximately 3.4% of U.S. GDP in nominal dollars.

Within specific franchise industries, real estate will rank first in output growth and grow slightly faster than the franchise sector averages in establishments and employment. Business services and commercial and residential services franchises will rank as the top two sectors in both employment growth and growth of the number of establishments in 2013.

Quick service restaurants -- the largest franchise business line -- will rank second in the growth of output and will see growth rates of employment and new businesses that are slightly higher than the franchise sector average.

2. Multi-unit owners in these franchise brands are happiest. Sotheby's International Realty, CertaPro Painters, Snap-on Tools, 1-800-GOT-JUNK? and Auntie Anne's are among the top 50 brands for multi-unit franchise owners, according to a report by Franchise Business Review.

Franchise operators who own more than one unit within a brand tend to be more satisfied overall than single-unit owners, the report says, which surveyed franchisee satisfaction of more than 6,600 multi-unit franchisees from more than 300 franchise companies to determine the best brands for multiple-unit ownership.

Multi-unit ownership has always been common among food franchisees, which benefit greatly from establishing economies of scale, but it has become increasingly popular with all types of franchisors and franchisees in recent years because of the many benefits that come with size. Prospective and existing franchisees recognize the significant revenue potential in owning three or more units and franchisors usually find it is easier to manage these relationships, Franchise Business Review says.

"Owning multiple stores within the same brand makes a lot of sense for the right business person, but it also involves a bigger investment and more risk, especially early on," Franchise Business Review President Michelle Rowan said in a press release. "People considering a multi-unit investment must do even more due diligence than single-unit candidates to determine if a brand can properly support them and if the culture is the right fit."
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $95.18 1.64%
FB $117.43 -0.96%
GOOG $692.36 -0.84%
TSLA $232.32 -3.92%
YHOO $36.01 -1.42%


Chart of I:DJI
DOW 17,750.91 -140.25 -0.78%
S&P 500 2,063.37 -18.06 -0.87%
NASDAQ 4,763.2240 -54.37 -1.13%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs