The beauty industry is well-known for being resilient even during major economic downturns. But how resilient is the model of franchising within the beauty industry? Let’s dive into the statistics and see what the numbers have to say.
What Makes Franchising A Good Option?
There are 2 significant reasons franchising can be a good option for businesses in the beauty industry:
- Franchising can help a business expand more quickly and efficiently than it could on its own. By partnering with franchisees, a business can open new locations in new markets without having to invest as much time and resources in the expansion process.
- Franchising can provide a business with a built-in customer base. Franchisees are typically required to use the business’s established brand and marketing materials, which can help attract customers and build recognition for the brand.
In all, franchising forms an ideal symbiotic relationship – and the resilience of the beauty industry complements the symbiotic relationship of the franchising model. This makes a solid combination that helps franchises thrive in the economic highs and safely survive the economic lows.
What Do The Numbers Say?
Data courtesy: statista.com (points 1,2), frannet.com (point 3)
According to a report by the International Franchise Association, the beauty industry is one of the fastest-growing sectors in franchising. Some specific data points that support the success of the franchising model in the beauty industry include:
- The projected revenue of the Beauty Industry is going to cross 100 Billion USD by 2027!
When you think of franchising, knowing the health of the industry becomes pertinent. And the projections and past trends of the beauty industry show that it is not only surviving difficult markets but also thriving and growing. The revenue of the beauty industry has shown a consistent upward trend since 2014 – and even through the pandemic in 2020!
- With growing social media trends, skincare is becoming more popular among Gen Z.
Another important consideration when choosing a business to invest in is the clientele – is it expanding? Shrinking? Staying the same? Knowing the clientele of a business gives you some insight into the potential for expansion and growth. And the clientele of the beauty industry is as fresh as ever. According to the numbers, Gen Z and millennials were collectively responsible for 80% of the industry’s sales in 2021.
- The success rate of franchising is higher than that of a standalone business in the same period of operation.
According to frannet, the success or survival rate of standalone businesses at the end of 2 years stood at 80%. Compared to that, the survival rate of franchises was 92%. On the same lines, the rate for small businesses at the end of 5 years dropped to 50% and that of franchises was at 85%.
Putting It All Together
On the face of it, these stats may seem disjoint and disconnected. But when you connect the dots, you realize that:
- The beauty industry as a whole is resilient in shaky economies.
- The beauty industry is growing in terms of revenue and clientele.
- Franchising comes with added resilience due to the established business model of an experienced company.
Not only is the industry as a whole pretty lucrative, but the double layer of resilience that you get in terms of the industry and the franchising model also indicate the factor of safety that you get when you invest in a beauty franchise.
To know more about franchising with Lash + Company Med Spa, visit www.lashandcompany.com/franchise-opportunity/