Are millennials the future of franchising?
With young people really beginning to make their mark as franchisees, the bfa’s Cathryn Hayes looks at how the industry needs to adapt...
There has been a lot of discussion about the millennial generation lately – some of it very negative saying that they are ‘entitled’ or not prepared to start at the bottom and work their way up. But is this really the case and what does that mean for the next generation of franchisees and franchisors?
Who are millennials?
Before we look at that in more detail, let’s remind ourselves exactly who millennials are. We’ve had the baby boomers – the post war generation – followed by Generation X and there was some talk about Generation Y but this seems to have been dropped in favour of ‘millennials’ – the generation who are currently aged between 18 and 34.
So this is the first generation in business who have never known a work environment without the internet. They are used to instant access, to online availability – no (or vague) memories of dial up internet or floppy disks for back up.
Their reputation if you believe all the articles you read, is one of impatience, ‘live for today’ with a short term outlook – how is that going to translate into being the franchisees and franchisors of tomorrow?
Are millennials the perfect fit for franchising?
Well, franchising offers a great deal to those who would really like to build their own future but may not have a unique or amazing idea for a business. Buying a franchise gives people the structure, brand and support to hit the ground running and begin to build up a successful business from the outset.
A good franchisor is always on the look-out for prospective franchisees who are ambitious and keen to grow their business and it could be that millennials will want to do just that.
According to research from Standard Life, almost three quarters (70%) of UK workers aged 25-34 are motivated to start a business and have the strongest desire for a “new challenge in their professional lives”.
Clearly you shouldn’t believe everything you read about millennials – and in many ways, they have had a tough deal. This may be the 1st generation for many years who will end up poorer than their parents. They have had to take out loans for their university education, long term steady employment is a thing of the past and the housing ladder is very difficult to get on without help from the “bank of Mum and Dad”.
They can see that the world of employment can be one of short term contracts with little, if any, stability. It’s full of downsizing, of automation, outsourcing and off-shoring.
So in fact, franchising might be just the way of taking control of their own destiny they are looking for – and with their motivation to start their own business and desire for new challenges, they have a lot to offer franchising in return.
Adapting for a younger generation
The British Franchise Association’s ‘In Business by 30’ campaign celebrates young people who have already demonstrated just how franchising can help people of all ages and across a wide range of industry sectors to build a successful business. Young people are making their mark in franchising – over the last two years almost one in five new franchisees has been aged under 30.
And what does this mean for franchisors? Do they have to change the way they recruit, train and support franchisees to accommodate this new work generation? Well, the answer is yes and no! Good franchisors should already have well-structured and resourced recruitment and training and support programmes and that shouldn’t change.
However, it is definitely worth franchisors reviewing the way in which they deal with this younger generation of potential franchisees. According to research from PricewaterhouseCoopers, millennials want and value frequent feedback so communication channels are even more important to them. Millennials also want to experience as much training as possible.
It will be increasingly important for franchisors to understand and address the differences and tensions which can arise between the different generations of franchisees. Understand what millennials want and how their aims and ambitions might be different from older franchisees.
It might seem like more work but millennials ARE the future of franchising and with their ambition and hunger for success, they should be welcomed with open arms!
Cathryn Hayes is head of business support at the British Franchise Association.