The pandemic impact on franchising

Abstract

Mid-March 2020 made adjustments in all areas of our normal lives. All spheres of the world economy suffer from huge losses. This results in inevitable changes that should be made quickly and appropriate measures requiring their immediate implementation. Absolutely all countries suffer from COVID-19 pandemic consequences and its devastating impact on all areas of the national economy. The franchising field is not the exception. According to statistics, the largest number of franchises of the service sector, which is the most one suffering from the introduction of strict quarantine measures. The lack of permission for full-fledged work, as in the pre-quarantine period, left some networks without any revenue at all. This was the impetus for changing the formats of franchises, if possible, or for their complete closure. After all, not all franchisors could pay royalties at low earnings, and some even had to face their complete absence. Therefore, closing for some formats was the best solution. Those who managed to preserve the format, with possible changes, faced a new reality, where it was necessary to take into account not only the interests of consumers, but also the new quarantine rules. That is why the analysis of franchising during the pandemic is very important. The work of franchising during COVID-19 pandemic, quarantine and post-quarantine measures are analyzed in this paper. Their direct influence on the work organization is analyzed as well. Analysis of the potential entrepreneurs readiness to buy franchise in comparison with the purchase of ready-made business model and starting your own business from scratch is carried out. The main world directions where it is important to open and develop franchise networks to be relevant and in demand are identified. It is considered how domestic networks respond to the quarantine measures, which anti-crisis means are used for their enterprises, which new formats are set up on the basis of the main enterprises. The loyalty of some franchisors and their anti-crisis measures for the franchisee are also investigated. The loyalty of some owners makes it possible to maintain their network in economically difficult times.