Within the rankings of the Franchise
500® are companies, both new and old, spanning a variety
of industries, from fast food to home improvement, clothing
resellers to automotive repair shops. In 2003, some segments will
rise above the rest, adding both franchisees and customers.
Working on the Franchise 500®, we at Entrepreneur
get a first look at some of these emerging franchise trends,
segments benefiting from the addition of new concepts, new
customers and increased revenue. What have we noticed this year?
Though on the surface, fresh-Mex fast-casual restaurants, senior
care, child care, specialized fitness, tech consulting and home
improvement may seem to have little in common, each of these
segments is making plenty of noise in the world of franchising.
| What's Hot in 2003 |
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Mexican food in general has been growing in popularity
nationwide, thanks in part to the country's growing
Hispanic/Latino population, which has expanded 57.9 percent over
the past 10 years and now accounts for 9 percent of the U.S.
population.
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Their influence is spreading to mainstream America, which now
sees Mexican food as a welcome alternative to standard meat and
potatoes--or, rather, hamburgers and french fries. Another timely
boost to the market: Fresh-Mex chains like Desert Moon and La Salsa
are luring customers with healthy fast food, offering menus
featuring grilled steak and chicken and fresh vegetables.
Not wanting to be left behind, McDonald's added Mexican
items like tortas to its menu a few years ago and now has a
majority interest in Chipotle, a burrito bar concept, while
Wendy's acquired Baja Fresh, a fast-casual grill franchise.
"Mexican food is one of the fastest-growing segments in our
industry," says Russ Smyth, president of McDonald's
Partner Brands. "It was a great place to start when
McDonald's began looking for ways to serve customers more
variety in tastes and experiences."
The heat of the segment and the strength of McDonald's are
definitely in Chipotle's favor. "Chipotle has grown
significantly since we invested in them, and that growth will
continue to accelerate," Smyth says. "Based on what we
see in the market and the reactions of customers, there's
tremendous future growth potential for Chipotle, particularly with
the full resources of the McDonald's system behind
it."
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