Franchises can still sell in a downturn
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Steve Chiotakis: Today in Washington, the International Franchise Expo kicks off. Companies that sell franchising packages will be hard-pressed to find takers in this economy. But opportunities are out there. From the Entrepreneurship Desk at Oregon Public Broadcasting, here’s Mitchell Hartman.
Mitchell Hartman: Bishops Barbershops of Portland will be at the Expo looking to expand its franchise footprint. Its stripped-down decor and cut-rate haircuts sell well in this economy. Video game retailer Gamer Doc will also be hawking its franchises in D.C. It’s expecting to expand from four to as many as 40 stores this year.
Company president Jim Belanger says offering consumers value — a $50 game you can play again and again — is key:
Jim Belanger: If you want to go to a professional basketball game you got to spend $300-$400, you’ve got to travel, you’ve got to be on their time schedule. I think people are just not willing to do that anymore, because, you know, they’ve basically just priced themselves out of the market.
Belanger says this is a good time to get into a franchise, with bargains on leases and construction easy to find. A franchise can cost upward of $200,000 and credit is tight these days. But franchisees are finding some creative financing options, like getting angel investors or tapping into retirement savings through an IRA.
I’m Mitchell Hartman for Marketplace.
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