There’s no doubt – a coffee franchise is a popular business option among startups. But how does it fare vis-a-vis an auto detailing franchise, which is also viable ?
In this article, we’ll compareย the two franchises in terms of future growth, costs, target market, location, expansion and growth prognosis, and ways to add value to the business.
Coffee Franchise
Future Growth
Yes, coffee is one of the worldโs most in demand beverages. There is definitely no stopping the coffee franchise fromย dominating the industry even after several decades. According to theย Houston Chronicle, coffee sales are lucrative with operating incomes of 2.5 percent of net sales and a gross margin of about 85%.
In fact, growth is not concentrated in US alone. The Center for the Promotion of Imports states:
Between 2014 and 2018, Europeโs coffee market only slightly increased by 1.3% in volume. At the global level, however, the coffee market is expected to grow at an average annual rate of 6.1% between 2018 and 2024.
However, according to an article inย ย Phys.org Newsย ,ย climate change is starting to affect coffee production. This is something that would-be coffee franchisees should be aware of.
Costs
Costs when opening a this type ofย business can vary depending onย the brand, types of services rendered, etc. ย Entrepreneur.com estimates the costsย as low as $100,000 up to $1.6M.
Target Market
Anย advantage of a coffee franchise is itsย wide market range. Its target marketย is not limited to a particular demographic. Itย appeals to theย young and old, students and professionals, regardless of socio-economic status. Recently, even senior citizens and families can be seen enjoying coffee shops all around the world. According to Small Business Development Center,ย 77%ย of U.S. adults drink coffee daily. In the West Coast particularly, the ideal ratio of coffee shops to residents in a particular area is 1:10,000.
Location
In the past, coffee shop sales wereย affected by the weather in certain localites or regions. Recently however, ย coffee shop locations are more geared towards business establishments to cater to business professionals and business executives. Coffee shops have evolved from just beverage stores to lifestyle centers where students can study. It has become a hub where business people meet and conduct business transactions. It has transformed to aย place where families meet to unwind and where a lot of people can spend some idle time in.
Expansion and Growth Prognosis
Coffee as a commodity has continuously evolved into various flavors, packaging and options. The versatility of coffee gives it the competitive edge. Get Entrepreneurial.com explains that alongย with the trend of organic and healthy lifestyles, shopย owners have started to offer a wide range of organic coffee choices that matchย the emerging lifestyles of the market. More and moreย people are also moving toย patronizeย environment friendly coffee shops. The rise of gourmet coffee shops also contributesย to the coffee business’ย advantage over other beverage shops.
Ways to Add Value to the Business
A coffee cup has now transformedย its image and function from just a warm or cold beverage for consumption to a cup of connectivity and lifestyle necessity. Thus, to enhanceย customer satisfactionย that can lead to repeat business and customer loyalty, most coffee shops addย value by providing free Wifi, gadget-friendly facilities and wireless technology options.
Auto Detailing Franchise
Auto detailing franchise
img src : unsplash
Future Growth
Another popular business opportunityย is the auto detailing franchise. Research showsย that the car wash and auto detailing industry yieldsย a $10Bย revenue. ย Industry operators will continue to benefit from rising per capita disposable income, aiding the auto detailing industry revenue. Yes, ย theย auto detailing franchiseย continues to be a business opportunityย worth investing in.
Costs
If you planย to start an auto detailing franchise business, you need to take a closer look into various factors in order to calculate the costs. These factors include location, the brand of the auto detailing franchise and more. Houston Chronicleย mentioned that an average franchise will cost about $275,000 for startup while mobile auto detailing and car wash businesses can have a range of $30,000 to $100,000.
Target Market
The auto detailing industry will continue to existย as long as there are vehicles in a location.ย Your target market can be anybody owning or renting a car. It can also be any business that uses automobiles for services either directly like car rental services or indirectly like flower shops and restaurants needing auto detailing and car wash services for their delivery vans. Like the coffee shopย business, auto detailing franchiseย options have a wide range of target market.
Location
However, unlike the coffee shopย business ย where traffic is the only consideration, choosing the location of an auto detailing franchise alsoย depends on theย following factors: location of competitors, costs of rent and facilities, availability of car wash waste disposal, etc. Of course, like the coffee franchise business, location where customer traffic abound is still the topmost consideration.
Expansion and Growth Prognosis
Armed with statistics to back it up, the auto detailing industry is definitely on the rise.ย Most researchers now consider that the trend of auto detailing is towards convenience of service. We can clearly see the rise of mobile auto detailing service, car wash spa, and specialized auto detailing services. The trend to explore new markets is also on the rise. For the auto detailing business, we have millennials, retired professionals, etc.
Ways to Add Value to the Business
Much like the coffee franchise business, the auto detailing business is also a flexible service business that has evolved through the years. Moreover, gone were the days were only fathers are the target market for auto detailing shops. In tune with the evolution of car enthusiasts and the way car owners have taken care of their cars, the auto detailing service has also evolved. More than the service itself, customers are now ย looking at value added service of the company, ย social responsibility of the brand, how the auto detailing franchise company takes care of its customers, ย and companyโs reputation.
Conclusion
Both theย coffee franchiseย andย the auto detailing franchise are viableย business options in the market today. It is wise to be aware of the various business factors involved in the two industries if you are considering to venture into these businesses.
If you need more information about the DetailXperts business franchise opportunity, check this out and your questions will be answered.
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