Cary, NC – In a cyclical market, new businesses come in while others either fade away or change to adapt. Cary is no different, with a growth in service-oriented business franchises while online retail impacts smaller businesses.
Michael Hall, principal consultant with FranNet Carolina, said the emergent trend through 2018 and into the near future is service-oriented businesses. These include services such as home senior care, commercial cleaning and a recent boom in fitness machine repair, which Hall said is a “huge market.”
“They’re generally less expensive because there is far less overhead,” Hall said. “They’re also very scaleable and can get very big, but they aren’t noticed like a retail franchise.”
Hall said this trend can be seen not only in Cary but across the Triangle. Not only are these kinds of businesses growing because of the lower cost but Hall said it is a reflection of the tight real estate market across the entire state and particularly in Wake County.
“If they are looking for a business that requires leased space, they are moving away from that,” Hall said. “I am seeing our clients purchase a retail business and wait six to nine months to open their first location because they’re waiting for the right retail space.”
The franchise market most people think of is food, Hall said, and while that remains large and will remain large in the coming years, Hall said changes will come based on societal tastes.
“Especially the tastes of millennials, who tend to be more interested in healthy eating,” Hall said.
What Is Amazon’s Effect
As service-oriented franchise businesses in Cary grow, Hall said boutique retail shopping is slowing down across the region, which could be due to both market saturation or online retailers such as Amazon.
“There is no doubt it has an impact on retail, especially small retail establishments,” he said.
What the full impact of Amazon is, Hall said he does not know yet, but he said it is likely small boutique retail will shrink.
Another market Hall said is on the possible brink of shrinking is fitness. Hall said there is a growing trend of fitness studios that focus on one particular exercise (yoga, pilates, rowing, cardio, etc.) where in the past, a gym such as the YMCA would have all of these functions.
“It’s so segmented, it’s not clear if it can be sustainable,” he said. Hall also said he sees his clients starting to move away from this kind of fitness business.
But as businesses go through contractions, Hall said this does not mean they are necessarily vanishing.
“They may go through changes. They do not always go away,” he said.
Story by Michael Papich. Photos by Hal Goodtree.