The franchise industry is showing more signs of recovery from the recession. An index compiled by the International Franchise Association rose 0.5 percent in September, its second straight monthly gain. The index is also up 2.2 percent from September 2011.
The improving economy, including a drop in the unemployment rate to 7.8 percent last month, helped lift the index, according to the IFA, a trade group representing the franchise industry. It also said loans are slowly becoming easier for small businesses to obtain. Most franchises — for example, an individual Subway or Jiffy Lube — are small businesses.
The IFA also issued its outlook for the franchise industry. It expects the number of individual franchises to grow by 1.5 percent this year. That's down from a forecast of 1.9 percent made earlier this year, before the economic recovery slowed. But the expected addition of nearly 11,000 franchises will be the first since increase 2008. Last year, the number of franchises in the U.S. fell by nearly 4,000. Since 2008, there has been a loss of more than 23,000 franchises.
I'M OK, THE ECONOMY ISN'T
Small business owners are more upbeat about their companies than they are about the economy. That's the finding of a survey by The Hartford, the financial services company.
The survey of more than 1,000 small business owners found that 68 percent believe their companies have been moderately to extremely successful this year. But only a third of the survey participants believe the economy will be stronger this year, down from the 61 percent who were optimistic about the economy in a survey during the spring.
But even with a positive view of their companies' success, many of the owners said they've had to change their business because of the weaker economy. Half said they had hired fewer employees. Two-thirds said they don't plan to hire during the next year. Fifty-two percent said they had reduced the amount of money that they and their partners earned. Nearly 60 percent said they've invested less to expand their companies.
They've also made their companies leaner — 80 percent said they've taken advantage of the slower economy to cut their costs. And they've looked for opportunities. Nearly 80 percent said they've been able to strengthen their relationships with their clients and customers. The economy also gave them more reasons to refine their business strategies.
NFIB KICKS OFF BUS TOUR
The National Federation of Independent Business has kicked off what it's calling the "I Built My Business" bus tour.
Starting Monday, Oct. 22 in Wisconsin, the NFIB says the tour will visit seven states to "amplify the critical role of the small-business community" in the U.S. economy.
Through Sunday, Nov. 4, the tour will also stop at businesses in Florida, Illinois, Indiana, Ohio, Pennsylvania and Virginia. The NFIB says it will hold events, including roundtable discussions with local business owners and elected officials and to discuss the challenges of owning a business.