Franchise Interest Resumes Migration To The South and East for Franchise Development
By: Michael Alston for Franchise Insights
June 26, 2024 – In a year-over-year analysis, interest in franchises shifted to the south and east according to new data from FranchiseInsights.com. By comparing quarterly shares by state for the first quarter of 2023 to the first quarter of 2024, there was a continuation of the shift in the mix of where aspiring franchisees were expecting to locate franchises – from north to south, and west to east. In the color-scaled map above, highest increases in state share in that period are shown in green, and decreasing share shown scaled to red. ranging in values from under two percent in either direction (1.94% loss from Florida to 0.59% growth in Mississippi).
This is almost a mirror image of the pandemic shifts in franchise interest from 2020 to 2022 that we showed earlier, and somewhat of a reversal of the northward and eastward trends spotted in an April 2023 article. In the latter article, Florida had grown and Mississippi decreased in interest.
Note that the state locations shown are where the prospect was searching to buy franchises, which in most cases is the prospect’s current state of residency.
Mississippi, gaining 0.59%, and Florida, losing 1.94%, had the two largest absolute changes in percentage share of franchise prospects among all 50 states over the recent 12-4 month span. Among the states with the largest increases in share, joining MS were southeastern states Louisiana, Alabama and Arkansas. Mid-Atlantic and adjoining states (NC, SC, KY, IN) and Arizona and Iowa rounded out the top ten gainers.
The chart below shows the percentage change for the states with the largest Q1 2024 overall franchise interest, where none of the top three showed growth over the prior year. Texas and showed only a modest decrease compared to Florida and California. Georgia and New York had the next highest shares, and both showed gains.
The overall trends in location of interest support the theory that having experienced remote work and more flexible working conditions brought about by the pandemic, workers moved to warmer and less-populous states. Then there was migration of interest out of states like MS and LA as companies called employees back to work. But in the most recent twelve months ending March 2023, those trends reversed again, with a general trend out of some of the most populous states (CA, FL, TX).
In this analysis we did not look at in-state migration – from larger to smaller cities with more affordable homes and less traffic, for example.
This proprietary data is drawn from the FranchiseVentures lead generation platform of franchise investment inquiries in the United States.
Franchise Ventures is the leading franchise lead-generation platform for potential franchisees to thousands of growing franchise systems in the United States and Canada. Its franchise lead generation brands include Franchise.com, Franchise Solutions, Franchise Gator, Franchise Opportunities, Franchise For Sale, SmallBusinessStartup.com and BusinessBroker.net, and together they provide the largest aggregation of prospective franchise buyers in the U.S.
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Published on Wednesday, June 26th, 2024.