Why Invest in a Recession Resistant Franchise?
Like it or not, there are some things in life that are out of our control. As a business owner, one of the major unpredictable forces that can have a huge impact on your livelihood are recessions. In the simplest terms, a recession is a prolonged period of weak and/or negative growth in real GDP. For small businesses, that means they can face declines in sales and profits, be forced to cut spending and staff, and in worst case scenarios, significantly scale back or even close. But, there’s a huge silver lining – some industries, markets, and businesses are more immune to the economic ups and downs that are beyond our control. Time and again, it’s those segments that more entrepreneurs are investing in for the long-term financial health of their business and livelihood.
According to a report in AP News, nearly 60% of U.S. business economists expect a recession to begin in this spring or summer, a result of high interest rates and increasing inflation. One economic expert told ABC News that a slowdown in the economy brought on by the Fed typically results in a lag of a few months behind given rate hikes. “Just because the economy is doing OK today doesn’t mean the economy won’t go into recession,” Nancy Lazar, chief global economist at Piper Sanderl, told ABC News. “It’s happening slowly.”
By investing in an industry or franchise system that has proven to withstand the challenges of previous recessions, entrepreneurs can soften – and even thrive – in times of economic hardships. Indeed, a report in Investopedia said recession-resistant companies can generally deliver stable revenue, regardless of outside economic conditions. “When looking to minimize downside risk during a recession, investors should look for companies that sell products or offer services consumers cannot easily cut,” Investopedia reported.
A Recession Resistant Industry
Aspiring entrepreneurs seeking a recession-resistant industry must hone in on industries that have constant demand and are always needed. In steps the hair care industry. Hair, like home services, always grows and will always need to be cut. There’s simply no alternative to having the quality service and care that your local hair salon can provide. Case in point: after the forced shutdowns brought on by the pandemic, hair salons across the U.S. experienced an unprecedented surge in visitation, as customers were beyond eager to get back in chairs and have their hair cut by a professional.
But don’t just take our word for it. According to a report by the U.S. Bureau of Labor Statistics, the hair care industry has a “bright outlook” in the coming years. Overall, the personal care services industry, which includes barbershops and hair salons, is projected to grow 8.1% from 2020 to 2030, nearly five times faster than the average 1.7% growth for total employment!
“The primary long-term factors driving employment growth in the personal care services industry are the general increase in demand for grooming services, a growing customer base, and the introduction of new services,” the U.S. Bureau of Labor Statistics reported. “A new haircut or manicure can boost self-confidence and make people feel better. As a result, many turn to professionals at barbershops, beauty and nail salons, and other personal care services for help to get that perfect haircut or style.”
Proven and Tested
Among the hair care industry, there is no company with a better reputation and bigger brand recognition than Sports Clips, the go-to spot for men and boys hair care. Founded in 1993, Sport Clips has become a mainstay in just about every city and town throughout the U.S. Case in point: despite the 2008 recession, despite the shutdowns of 2020, and despite the lingering impacts of the pandemic on the U.S. economy, Sport Clips not only continues to thrive, but also expands across the country. As of now, Sport Clips boasts more than 1,800 locations in all 50 U.S. states, with plans to open even more units in the coming years. What more proof do you need than that?
Sport Clips continued growth is attributed to its straightforward, high profit potential business model, an operating plan that excels at low ongoing and overhead costs, and a backing team of professionals that are there to support Team Leaders every step of the way. Entrepreneurs seeking a best bet investment opportunity would be lost finding a better brand with more proven growth than Sport Clips.
“Sport Clips is stronger than ever before,” says Edward Logan, CEO of Sport Clips. “We’ve proven that we’re not only recession-resistant, but we’re also pandemic-resistant. This is a very stable business with steady cash flow and straightforward business model. Now is a great time to invest in Sport Clips, because as we head into 2022, we’re excited about the great real estate opportunities that exist right now, as well as the disruption of client behavior. As people change their buying behavior and their habits, the brands that go out and capture those clients are going to win an outsize market share. That’s going to be us because that’s how we’re thinking.”
Unmatched Franchise Support
It all starts with the amount of training and support Sport Clips provides to its Team Leaders. This is why Sport Clips has invested so heavily in one of the most robust ongoing support platforms in the industry. As a Team Leader, we’ll help you master how to hire and retain staff, manage operations, use our state-of-the-art technology, market effectively, meet your financial goals, and much, much more. From day one, the Sport Clips team helps you find a location for your business, as well as all the tricky ins and outs of the real estate process. We also provide a comprehensive training plan for your stylists, ongoing support, and professional advancement. For anything and everything, Sport Clips is there.
“Culture is key,” says Julie Vargas, Vice President of Career Development & Team Member Engagement. “If you take care of your people, they will take care of you. It sounds so simple, but it’s so important. If you have happy stylists, they will go above and beyond for your customers. But just as importantly, if you take care of your people, they will stay with you, they will be loyal to you, and they will drive your success.”
Invest in Sport Clips Today
Don’t wait any longer to begin realizing your dreams of business ownership with a storied brand built to withstand all the economy’s ups and downs. To learn more, visit our research pages here or make a request for more information.