Franchises: portfolio diversification opportunity for construction and facilities entrepreneurs

Franchises: portfolio diversification opportunity for construction and facilities entrepreneurs

When analyzing any investment, it is essential to have information summarized in what is often called a business plan. This is a document that summarizes the characteristics of a project, the necessary investment and the expected return on that investment. There are several ways to write a business plan, but always, in one way or another, five fundamental points must be shown, which are the definition of the business, the size of the market, the established network of competitors, the management that will manage the business, and finally, the finances, that is, the “economics” of the project.

After the pandemic, the franchise market in the United States grew dramatically. The total number of franchise establishments will reach 805,000 units in 2023 and will reach 8.7 million employees

“Real Estate” today is the true currency of the world, and all savings opportunities are seriously damaged by the growing inflation that occurs in all countries of the world, especially increased by the so-called “stimuli” that the governments of the world decided to give after the 2020 pandemic. The uncontrolled issuance of money is wreaking havoc on global economies and investors are taking refuge in Real Estate to preserve the value of money. Everything suggests that we have decades ahead of us with this phenomenon, and that the demand for the construction of buildings, offices, commercial premises, industrial plants, private neighborhoods, and private homes will continue to increase every year.

In Argentina there are business opportunities too, even in this delicate context. There are currently an estimated 45,000 franchise businesses that represent approximately 25% of the country’s retail sales. The number of jobs generated by franchises is estimated at around 250,000 people.

There are franchises for practically everything, within construction there are also companies that sell products to supply the facilities of a building project, basically toilets, taps, crockery, pipes, ventilation, heating, drains, tools, and various other products. industry. A successful example of this is ABELSON.

As for the market, the environment is very favorable. The ISAC indicator (synthetic indicator of construction activity) prepared by the INDEC, in April 2022 the index fell to its historical minimum floor with a value of 40 points, and from there, the construction sector grew steadily reaching 198 points in June 2023. According to specialists, the areas of GBA that have the most growth prospects for the construction of warehouses and industrial plants are the Pan-American corridor between the RN9 and RN8, the southern zone and the western zone in General Rodríguez, Moreno and Merlo. Route 6 is presented as the main highway to link all the corridors, and it presents great features.

For their part, private neighborhoods do not stop growing. In GBA alone, in the south, north and west, there are more than 12,000 houses under construction. But the phenomenon is not only in Buenos Aires, but is repeated in almost all parts of the country. The phenomenon of private neighborhoods began at the end of the last century and increased sharply after the pandemic.

Added to this is the incessant construction of office and residential towers in all the country’s capitals.

The franchise business is a replica of this professional structure, and is what is transmitted to the franchisee through detailed operating manuals that cover all aspects of the business, such as sales, marketing, administration, resource management human resources, maintenance, audits, brand procedures, and other more mundane issues such as the daily operation of the business and the computer system to record daily operations. All of this is supported by an initial and permanent training program for the franchisee and his staff, which is provided throughout the entire duration of the franchise contract, which is 5 years.

Franchising is undoubtedly a different business opportunity. There are franchises of ice cream parlors, confectioneries, clothing brands and there are also those of suppliers of construction materials, an area that is always sensitive to the situation but whose curve, measured over time, is always positive and even though the country is in a moment complicated, we envision a 2024 with a lot of growth in the sector.

Opportunities do not come alone, they are sought, and perhaps the best time to invest in a franchise linked to construction is now.


Source: Ambito

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