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05 March 2025

Franchise Model Thrives Amid Economic Challenges And Youth Interest

Banque Populaire's survey highlights entrepreneurs' growing preference for franchising as digital innovation reshapes the sector.

With the spirit of entrepreneurship alive and vibrant among the youth, recent findings reveal how franchise models are becoming increasingly attractive for aspiring business owners. Banque Populaire, partnered with the Fédération Française de la Franchise (FFF) and Kantar, recently unveiled the results of its 21st Annual Franchise Survey, which highlights not only the resilience and adaptability of franchises but also their pivotal role as stepping stones for younger generations.

According to the survey results, which were announced on March 4, 2025, 33% of French citizens express the desire to start their own businesses, with 52% of those aspiring entrepreneurs considering the franchise route—a notable rise of 9 points from the previous year. Remarkably, among those aged 18-24, this interest spikes to 66%, up by 6 points within the same timeframe. This trend suggests not just budding ambition, but also the growing appeal of structured support provided by franchises.

The report indicates significant shifts within the franchise sector. For example, 76% of current franchisees were previously employees, with 42% switching industries to explore entrepreneurship. Such statistics shed light on how franchises serve as transition platforms for those seeking to break free from traditional employment.

A staggering 87% of franchisees affirm their enthusiasm for their choices, with even higher ratings—91%—among young franchisees under 35. This level of satisfaction speaks volumes about the franchise model’s effectiveness, especially when contrasted with independent business efforts.

Franchisee resilience is also notable, as 79% feel they possess superior capabilities to weather economic downturns compared to solo entrepreneurs. This sentiment is echoed at the franchisor level, with more than 92% having opened at least one new franchised location within the past year, leading to an average of nine new establishments launched. This dynamic growth, occurring even amid challenging economic landscapes, showcases the enduring strength of franchises.

Digital innovation is another cornerstone of this year’s findings. With 71% of the French population frequently shopping online—including 30% via social media—franchisors are acknowledging the importance of digital tools. Impressively, 94% provide guidance to franchisees on optimizing these digital channels to communicate with customers effectively. Meanwhile, the integration of artificial intelligence (AI) is perceived differently across the sector. A significant 80% of franchisors view AI as a beneficial opportunity, with 60% already utilizing it to refine their business operations—a significant increase of 24 points since last year. Interestingly, only 48% of franchisees share this positive outlook, with 14% identifying it as a potential threat, illustrating the necessity for franchise systems to educate and support their partners as they navigate technological advances.

“The results of this 21st edition of the Franchise Annual Survey reflect the vitality of the franchise model,” stated Véronique Discours-Buhot, General Delegate of the Fédération Française de la Franchise. “This renewed confidence, alongside the high recommendation rate of 87%, reinforces the strength and relevance of franchises.” Her observations come at a time when many are seeking economic stability through community and collaboration.

The survey findings also reveal an increased focus on sustainability, with 93% of consumers preferring brands supporting local production efforts. Over the last year, 67% of franchisees undertook actions aimed at diminishing their environmental footprint. This is corroborated by the fact 74% of new franchisees are selecting networks based on ethical values.

Among franchisors, 94% are developing eco-friendly offerings, and 93% are reformulating their processes to limit their ecological impacts, marking important steps toward responsible practices. Supporting local suppliers is now prioritized by 79% of franchisors, reflecting both consumer demand and the broader societal shift toward sustainability.

“Facing today’s economic challenges, the franchise model proves its relevance once more,” noted Anthony Clément, Director of Professional and Enterprise Developments at Banque Populaire. “Franchisees and franchisors are agily adjusting to societal and eco-responsibility challenges.” His emphasis on collaboration resonates strongly within the franchise community, as they rely on shared expertise and support to navigate the fluctuities of modern markets.

These findings are not just reflective but are part of broader narratives leading up to Franchise Expo Paris, where Banque Populaire will showcase its support for the franchise community from March 15-17, 2025, at stand G14-H13.

On the other hand, the Carrefour group finds itself embroiled in legal challenges as the Carrefour franchise association (AFC) accuses it of imposing harsh terms upon its franchisees. Following the prosecution's statement on February 27 to support the demands put forth by the Minister of the Economy, the AFC highlights claims of unbalance within their partnership. The prosecutor's office plans to seek penalties, including potential damages and the cancellation of contentious clauses within franchise contracts.

With the proposed civil fine set at €200 million, Carrefour's confidence remains unwavering. The company expressed faith in the integrity of its contracts, stating, "We have total confidence... and will continue to defend this model." This assertion contrasts sharply with the AFC's claims about the detrimental shift prompted by CEO Alexandre Bompard’s reforms since 2017, which the CFDT union also claims are aimed at minimizing workforce costs and disrupting established agreements.

The outcome of these tensions may have lasting repercussions on the franchising sector, especially as the examination of these legal matters is expected to yield results by June 5, 2025. This blend of challenges and opportunities demonstrates the complex nature of franchising and the balancing act required to thrive.

Moving forward, key insights from the Banque Populaire/FFF survey will be published monthly through five chapters from March to June 2025, providing continual updates on the shifts within the franchise industry. These releases will serve as valuable resources for both aspiring and established franchisees as they chart their paths forward.