Franchise firms and people seeking to franchise could be optimistic.
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This 2020 election season has been one like no different. The months main as much as election day — and certainly the times following election day — have been each passionate and tumultuous. With the election now over, the long run for franchising is predictable and promising.
Covid Aid for Small Companies
There’s merely no method round it: Any president should and can make help to small companies like franchises a precedence. Candidate Joe Biden promised extra reduction cash to small companies, with a lot of this help within the type of outright grants. His platform promised to order half of latest small-business reduction — whether or not through the Paycheck Protection Program (PPP) or future efforts — for companies with 50 workers or fewer. His restart bundle promised further assist for rehiring and retaining workers, with a specific emphasis on security. Elevated security measures for workers ought to afford a better stage of consolation for company and, in flip, increase enterprise. His plan additionally features a tax credit score for small companies adopting office retirement financial savings plans, benefitting small companies and their workers alike.
As well as, Biden’s plan included measures to extend minority enterprise possession and promote minority entrepreneurship. That is definitely good for franchising.
Though passage of further Covid-19 reduction to small business homeowners was stalled in the course of the marketing campaign, each the Trump and Biden campaigns pledged assist by way of extension of PPP advantages and different measures. With the election behind us, there are presumably fewer obstacles to getting a reduction invoice handed. This can definitely profit franchising by serving to franchised companies keep afloat and offering mortgage forgiveness. If the administration aids in maintaining rates of interest low, this enables potential franchisees a sexy alternative to maneuver ahead with enterprise possession. Many expert administration professionals misplaced their jobs in the course of the pandemic. These professionals, with maybe financial savings and different monetary sources accessible to them, provide a widening pool of well-capitalized potential franchise candidates.
The franchise industry applauded the extra common sense strategy to joint employment that emerged underneath the Trump Administration. Below that new customary (which in actual fact was the previous customary), a franchisor wouldn’t be thought-about a joint employer of the franchisee’s workers except it really exerted direct and speedy management over the franchisee’s workers. The years main as much as that had been plagued with uncertainty for franchising, and it is a path the business doesn’t wish to observe once more. Below a Biden administration, the present NLRB will maintain a conservative majority till the top of 2021, so it’s unlikely that there will likely be nationwide rulings on a federal model of AB-5.
Whereas the regulatory panorama could shift underneath a Biden administration, the franchise business has been by way of a difficult regulatory setting earlier than and thrived. As an business, we’ve finished a greater job of teaching legislators on franchising and on how these legal guidelines may pose a devastating impression, one thing nobody desires on their watch. And in the course of the years that joint employment legislation was in limbo, franchisors revised their FDDs, operations and coaching manuals, and advertising messaging in anticipation of this, so we’re not ranging from scratch this time. And since these points will all the time be company-specific, correct planning and execution can alleviate most future issues. On the finish of the day, the nation wants our franchised companies to offer employment and emerge from the pandemic, so there may be little motivation for an administration to offer further hurdles.
The Advantages of Certainty
This has been a protracted election season. There are measurable advantages to the understanding we now have achieved during the last a number of days, as evidenced by constructive positive factors within the inventory market within the days instantly following the closing of the polls. And excellent news, just like the current announcement that the Pfizer vaccine will be coming sooner and may have better efficacy than anticipated, will additional stimulate progress.
And whereas some races remained undecided and should require a January run-off election, the sturdy probability of a Republican senate ought to translate to an setting of compromise and collaboration that can end in extra stability and fewer vitriol than in current months. That stability will translate into stronger confidence in entrepreneurs’ talents to spend money on a franchise, realizing that their 401(okay)s and different sources of funds are performing effectively. A stage of closure additionally permits firms to higher undertaking what their tax liabilities will likely be, what labor prices will likely be and the way to safely open with out the uncertainty of getting to rapidly shut once more. All of those components result in a greater setting for franchise growth, and we proceed to foretell that 2021 will likely be a banner 12 months for franchise gross sales.