Almost two-fifths (38%) of owners of businesses set up in the last ten years are optimistic that the UK economy will improve in the next 12 to 24 months.
Some 9 per cent said that they expected to see improvement in the next 12 months. This is according to new research by Geek Retreat, the geek culture retailer, gaming café, community hub, and events venue.
The research reveals the challenging circumstances have impacted business confidence, with 17 per cent of owners questioned as concerned about their business failing in the next five years, and 27 per cent said they are quite concerned. Over half (52%) said that they aren’t concerned about going bust at all. Almost half (49%) of those questioned said that the cost-of-living crisis has adversely affected the performance of their business, with over half (55%) of these saying this has resulted in a decrease in profits of between 11 per cent and 50 per cent.
Peter Dobson, CEO of Geek Retreat said, “after a difficult couple of years where businesses have struggled with profitability and the impact of the cost-of-living crisis, there is a sense that economic recovery is on the horizon. It is in these challenging circumstances that the franchise model comes into its own, with failure rates lower than a sole proprietorship. At Geek Retreat, we have created our Franchise Success Team to support our franchisees when they need it most, whether it's financial management or purchasing merchandise.
“Over the last 12 months, Geek Retreat has outperformed the CBI’s high street performance reports, demonstrating the real resilience of our network of stores but also the importance of reimagining retail to focus on experience and community building. By focusing on creating meaningful integrations, businesses can attract new customers, drive more sales, higher engagement, and long-term loyalty.”
Benefits of joining a franchise:
Reduced risk – one-fifth of new businesses in the UK do not make it past the first year and 60 per cent of new businesses fail within the first 3 years. Only 33 per cent of small businesses reach the 10-year mark. According to the British Franchise Association, the rate of failure for franchisors has stayed between 8-12 per cent for over 22 years.
Reduced costs - the initial investment required for joining a franchise is often a lot less than starting from scratch and franchisees can tap into an established brand and systems and processes, saving time and money.
An established brand and customer base - with a franchise, customers will already know about the brand, although there will still be a need to promote the business in its new territory.
Product innovation and R&D - established franchise brands have the manpower and capital to constantly research and develop new products and services to adapt to changing consumer trends.
Purchasing power – whether it is new merchandise or supplies for the café, franchisees benefit from the enhanced purchasing power of the bigger group.
Support – franchisees have all the benefits of being their boss but are also part of a larger network of like-minded individuals and industry experts who can help solve problems, and share ideas, and best practice.