Worcester Business Journal

wbjournal.com | July 24, 2023 | Worcester Business Journal 21 Franchises offer vital economic opportunities V I E W P O I N T E D I T O R I A L A s small businesses continue to navigate the post-COVID economic landscape, there is an of- ten-overlooked sector of the economy potentially key to the revitalization of Main Street America: fran- chises. In 2023, the International Franchise Association predicted there will be 805,000 U.S. franchised businesses, with 11,000 of those in Mass., employ- ing nearly 120,000 people. Oen perceived as big business, franchises are in fact small busi- nesses, individually owned and operated by individuals and fami- lies. ey span industries from pet care to home services, to lodging and early childhood education, to the well-known quick-service restaurant brands people are most familiar with, encompassing more than 300 lines of business. Massachusetts is home to several iconic franchise brands, including Dunkin' and MaidPro. Coming out of the pandemic, franchised businesses led the economic recovery, and growth is predicted to continue even as economic un- certainty persists. When aspiring entrepreneurs seek to open a franchised business, they sign a licensing agree- ment with a brand to use its name and processes to sell its products in exchange for a royalty or fees. Franchisees receive valuable training and support from their brand. e franchise owners then run their own businesses, em- ployees, and customer relationships. e business model has proven resilient in tough economic times, such as benefiting from economies of scale to help control prices, and systemwide brand recognition to help recruit and retain employees non-franchise small businesses lack. A Retailers Association of Massachusetts member survey showed 70% of small business members were looking to sell or retire within the next decade. Franchis- ing could play a vital role in filling some of those voids. Because of low startup costs and a proven business mod- el, franchises are appealing to people who may tradition- ally be disinclined to risk it all on a business venture. is is especially true for first-time business owners, women, veterans, and people of color. Almost 31% of franchises are owned by people of color, compared with 19% of other independent businesses. At every level, these businesses offer opportunities for economic and career advancement. Franchisees offer high wages and quality benefits, including health insur- ance and vacation. For many employees, a job at a local franchise becomes a satisfying career as they climb the ranks faster than in other small businesses. As we think about ways to keep the Massachusetts economy thriving, we should welcome new franchised businesses and all the opportunities they bring. Jeff Hanscom is vice president of state and local government affairs for the International Franchise Association. Bill Rennie is vice president of the Retailers Association of Massachusetts. BY JEFF HANSCOM AND BILL RENNIE Special to WBJ A T H O U SA N D WO R D S B Y R A M Ó N L . S A N D O V A L Higher ed is a strategically important industry in Central Mass. Jeff Hanscom E ven though the entire industry totals just 15 colleges and universities through Central Massachusetts, higher education remains a strategically important industry and plays a critical role in the region's economy. While higher ed might have a lower regional economic output than real estate, manufacturing and the healthcare sector, its role extends far beyond its dollar-amount impact, even though that figure is still significant. According to a March report from the Association of Independent Colleges & Universities in Massachu- setts, which includes the eight private colleges and universities in the region, the industry produces $3.8 billion in economic impact and supports 18,800 jobs. Add in the region's seven public institutions, including Framingham, Fitchburg, and Worcester State univer- sities, and the impact on the region's economy may come closer to double the figure in the AICU Mass report. While the dollars and cents generated by these institutions are impressive, schools like UMass Chan Medical School and Worcester Polytechnic Institute are actively incubating research and spurning entre- preneurs to found companies with specialties in life sciences and green technology, among many fields. e growth of these industries has been possible here in large part due to our institutes of higher educa- tion, where students and professors from across the globe fuel our local economy. Central Massachusetts business leaders need to support efforts to attract and retain these graduates by partnering with schools to help develop curriculum to produce graduates ready to work in these cutting-edge industries, while mento- ring and investing in entrepreneurs who are creating and growing these exciting new companies. As vital as its contributions may be, the higher edu- cation industry is suffering through a turbulent time, on multiple fronts. A slowdown in overall population growth nearly two decades ago has produced fewer students graduating from high school, and thus a con- strained pipeline of college attendees. Becker College in Worcester was forced to close in 2021, and schools, especially those with thin endowments, are looking to expand by attracting older, non-traditional students – many of them employees who want additional training and education. Additional challenges include dealing with the end of affirmative action as an admis- sions policy. In order to keep their student bodies full of people with all sorts of backgrounds, colleges will need to understand the issues impacting these popula- tions and reinvent some of their systems for recruiting and retaining a diverse group of students. Higher education has oen been referred to as the ivory tower, inferring an aloof and out-of-touch air, but these days that's simply not the reality. We need our higher ed institutions to maintain our competitive advantage, and they need deeper partnerships with the business community. Working together, we can continue to grow a robust and competitive economy. The above Editorial is the opinion of the WBJ Editorial Board. The Viewpoint column, the A Thousand Words cartoon, and the Word from the Web commentary represent the opinions of their authors and do not necessarily reflect the views of WBJ or its staff. WBJ welcomes letters to the editor and commentary submissions. Send them to bkane@wbjournal.com. W W Bill Rennie

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