The coming year will be a boom time for franchises as people being made redundant look to work for themselves, according to Franchise Development Services (FDS).
The consultancy reports that over 2,000 people have registered an interest in owning and operating a franchise since November 2008, with the additional security that comes from operating under a larger brand one of the main reasons.
"With thousands of people throughout the UK being made redundant and more facing the prospect of losing their livelihoods, many of those fortunate enough to receive redundancy payments or have capital available for investment are expected to give very serious consideration to entering self-employment by purchasing a franchise," says FDS founder and chairman Professor Roy Seaman.
"They are examining the facts and discovering that it is easier to start a low overhead business than find a job with a salary comparable to the one that they have lost."
FDS said it saw a 100% increase in the number of people interested in taking out a franchise from December, after a largely sluggish year in 2008 which it attributes to concerns over fall the value of assets such as houses and share prices.
But it believes franchises could also benefit from a recession in other ways due to a weakening of the competition, customers seeking security in recognised brands and the falling cost of taking out a franchise.
"There is a lower opportunity cost to investing in a franchise: there are few jobs that can be considered secure and there is very little benefit in hanging on and hoping for the best," added Seaman.
"Major companies are slashing their marketing which creates opportunities for smaller businesses and franchise owners to take the lead through the greater purchasing power, established customer base and market know-how of their parent franchisors.
"With over 1,250 franchise brands representing over 200 business categories in the UK, there is a great deal to choose from and you can buy into a genuine business format franchise from as little as £10,000."