Texas, Illinois and New Jersey Gain the Most In Franchise Interest as California Decreases
By: Michael Alston for Franchise Insights
November 20, 2024 – In a year-over-year analysis, interest in franchises migrated eastward and selectively southward according to new data from FranchiseInsights.com. By comparing quarterly shares by state of inquiries about franchises for the third quarter of 2023 to the third 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 shares in that period are shown in green, and decreasing shares are shown scaled to red, ranging in values of about a half of one percent in either direction (-0.51% loss from California to 0.55% growth in Texas).
These changes somewhat reverse the declines seen in Texas and Florida in the first quarter of 2024 compared to the prior year.
Note that the state locations shown are where prospects were searching to buy franchises, which in most cases is the prospect’s current state of residency. This proprietary data is drawn from the Franchise Ventures lead generation platform of franchise investment inquiries in the United States.
Texas, gaining 0.55%, and California, losing 0.51%, had the two largest absolute changes in percentage share of franchise prospects among all 50 states over the two quarters spanning twelve months. Among the states with the largest increases in share, joining Texas were populous Illinois, New Jersey, and Massachusetts, mid-Atlantic Virginia and adjoining Tennessee, and deep South states Mississippi, Alabama and Arkansas. New York and Arizona rounded out the top ten with modest gains.
Hurricane Helene may have been a factor in decreases in Georgia and North Carolina.
The chart below shows the percentage change for the states with the largest Q3 2024 overall franchise interest, where only Texas and Florida of the top three states showed growth over the prior year and California showing a decrease. This was the first time that Georgia and North Carolina showed declines, and Florida barely notched a gain, probably due in some part to the devastation and aftermath of Hurricane Helene. The storm made landfall in Florida on September 26, 2024, and cut a path of devastation and fatalities through Georgia and North Carolina. Fires burned over 720,000 acres in California in Q3, but it is difficult to isolate that impact versus the decreases in relative interest seen in that state since the pandemic began
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.
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Published on Wednesday, November 20th, 2024.