City Centre Mirror
By Sanam Islam
Franchising has been growing rapidly across Canada, and Toronto is no exception. Children’s education, pets and space renovation for seniors are just some of the franchise sectors that are on an upward trend in the city.
At a national level, food brands make up almost 40 percent of the franchise industry, while consumer products and services account for most of the remaining percentage.
According to the Canadian Franchise Association (CFA), the following areas saw the most growth between 2011 and 2012 in terms of entry of new brands:
• business-to-business consulting (39 per cent)
• hair and nail salons/spas (38 per cent)
• commercial/residential services (25 per cent)
• seniors/home care and services (22 per cent)
• children’s products and services (19 per cent).
“Franchised businesses are meeting the needs of the community. Where there’s a need, that’s where you’ll see growth,” said Lorraine McLachlan, president and CEO of the CFA.
While the trends identified by the CFA apply to all of Canada, there are certain sectors that are doing particularly well in Toronto because of its specific demographic.
One such sector is children’s education, which includes tutoring services and supplementary education centres. It is becoming successful partially because Toronto attracts educated immigrants from countries like China and India who are concerned about their children’s academic success, said Claus Etzler, owner of Etzler Franchise Consulting in Toronto.
He added that parents increasingly want to prepare their children for a globalized economy.
“A lot of parents say they like public school education, but if they see their child is not doing as well as they should be, they send them to summer school or put them into crash courses before their exams so they can get good grades to get into a good university,” Etzler said.
The pet services sector, which includes everything from dog walking to pet grooming, is also emerging as a trend in Toronto, particularly in the east end, the Beaches area and among condominium-dwellers along Yonge Street.
“More people want to have pets for companionship, but they don’t have the time for it,” Etzler said.
Barrier-free living and space renovation for seniors is also doing well.
“A lot of seniors in Toronto who want to stay in their homes – because they can with condos – have showers they have to step over, so they want to make them barrier-free,” said Brent Barr, a professor who teaches a franchising course at Ryerson University’s Ted Rogers School of Management.
In addition, many seniors who downsize to a condominium to save money for retirement convert their space to get the functionality of a larger home.
Health foods and ethnic fare, such as Asian and Mexican cuisine, are also an emerging trend. “We’re getting a lot of fresh food options in the world of franchising. They are giving us ways to eat better, which is more in line with who and what we’ve become as we change our life socially,” Barr said.
Toronto’s preference for unique dining options (rather than big brand names) allows homegrown, upscale healthy eateries at a slightly higher price point to succeed. However, outside of the city, such franchises tend not to be as popular, Etzler said.
Like other cities across Canada, senior and home care services, as well as beauty care, are booming in Toronto. These sectors and, in fact, most sectors, are expected to continue growing.
Etzler predicts there will be explosive growth in the environmental sector. While other sectors have been around for at least a decade, this sector has only emerged in the last few years. It includes products and services such as solar panels, green energy, environmentally friendly building cleaning and air-filtration products.
“The environmental movement is creating whole new industries that didn’t exist 10 years ago or even five years ago,” Etzler said.
Convenience-related franchises are also expected to be a major trend. As more people near the end of their careers, they have more funds, but less time, said Barr. This means they will be more likely to pay for tasks such as the picking up and dropping off of dry cleaning or meal deliveries.