For almost a year now, economic pundits in the U.S. have been playing the “will it or won’t it” game with whether we’ll see a recession in the next six to 12 months. Experts on both sides haven’t been able to build a consensus on the certainty of an economic downturn and the mixed signals our economy has been showing haven’t helped tip the scale one way or the other. In uncertain economic times, it may seem like a challenge to plan out your next career or business move with confidence. But franchising does give you many advantages in meeting this challenge.

2021 was an economic bounce back year for franchises despite the negative impacts of the COVID-19 pandemic on businesses in 2020, setting the stage for some very positive franchise industry outlooks in 2022 (link to previous blog). In this post, we’re going to review what factors made 2021 a turnaround year for franchises and look at some of the data highlighted in The International Franchise Association (IFA)’s recently released 2022 Franchising Economic Outlook.

Across every sector, franchises were a significant engine powering the 2021 economic recovery. This year, we forecast that the local businesses behind recognized brands will continue to expand—unless a more consequential threat than COVID-19 materializes in the form of policies that undercut the franchise business model. Wherever they spring up, these proposals should be rejected and reversed so franchises can continue providing opportunity to Americans on every rung of the economic ladder.

This week, the California State Assembly is attempting to revive the so-called “FAST Recovery Act” or AB 257 after it failed in the legislature last year. This legislation would effectively end the existing franchise model in California, an industry that supports nearly 25,000 quick service restaurants in the state, employing over 373,000 Californians. This bill would hurt the entrepreneurs who have built these local businesses, the hundreds of thousands of jobs they support, and the communities in which they operate.

On December 8th, IFA’s Michael Layman and Haider Murtaza organized U.S. Senate meetings for IFA members to discuss topline issues affecting the fitness industry. IFA Members included Chuck Runyon, CEO and Co-Founder of Self Esteem Brands, and Katie Muehlenkamp, franchise owner of the Bar Method in Brooklyn, NY. IFA members were also joined by industry partners, Liz Clark, President and CEO of The Global Health & Fitness Association (IHRSA), Brett Ewer, Head of Government Relations of Crossfit, and Patrick Connolly of Velocity Public Affairs.

While COVID brought many industries to a standstill, it is clear that those in the hospitality industry were dramatically impacted. However, franchise restaurants fared significantly better than independent operators. In the aftermath of the immediate crisis, let’s look at the wins for the franchise community that prove just how well the franchise restaurant model works when the industry is turned upside down by a pandemic.