The Outlook for Business Operations for Multi-Unit Franchisees in 2025

The start of the new year is a good time to assess the current state of business operations and look ahead at where things will go over the next 12 months. That is especially true in 2025 with a new incoming presidential administration and the state of the economy being one of the primary concerns of many throughout the country.

More specifically, what is the economic outlook for multi-unit franchisees in 2025? Franchise Update recently spoke with members of the Multi-Unit Franchising Conference Advisory Board to get their thoughts.

Below are some thoughts from three MUFC Advisory Board members on the economy and their businesses, along with their predictions for 2025.

What is your vision for the economy, the franchise marketplace, and your own business in 2025?

“My vision for the economy in 2025 is very neutral. There are too many factors that we can’t control now. The potential tariffs, the conflicts in Middle East, Ukraine, and other parts of the world will have a major impact on our economy. I am hopeful that most of it will be very positive for the United States. We are a country in a great position to benefit from all the economic turmoil in most parts of the world. The new digital transformation that is happening right now with blockchain and AI will benefit the US economy in a very positive way.

My personal business in the hotel industry will for sure be using a lot of AI and robotics in the coming years to benefit profitability and the guest experience.”
-Karim Khoja – Comfort Suites, Four Points by Sheraton

“I am hopeful in 2025 for our business that the interest rates will continue to drop. We would continue to develop both our brands. The franchise industry is stronger than ever and will continue to grow. I have seen so many emerging brands that are seeing growth. It is very encouraging, and my brands have been growing at record numbers. My only concern with 2025 is what the new administration will do with the import taxes.”
-Mitch Cohen – Jersey Mike’s Subs, Sola Salons Studios

“The economic outlook of 2025 will continue to present dynamic challenges and opportunities. We saw some growth in the economy in 2024 mainly driven by consumer consumption. As we look toward next year, inflation will continue to cool and borrowing costs for business growth though high will not impeded business growth. There will be some economic policies by the incoming administration that will affect trade such as tariffs which will raise consumer prices. The potential immigration policies could affect the labor market could cause wages to continue to increase.

Despite these potential variables there will be continued growth in the economy. For my business, my vision is to continue to carefully vet industries and brands that are seeing positive growth, strong operational efficiency, and high consumer demand.”
-Paul Booth, Ace Hardware

In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year?

“Multi-unit franchisees will likely adopt AI-powered tools for inventory management, workforce scheduling, and customer relationship management. This will reduce overhead costs and streamline operations, especially for franchisees managing multiple locations. Rising labor costs will push franchisees to automate routine jobs like self-service kiosks in food and robots in warehouses.”
-Karim Khoja – Comfort Suites, Four Points by Sheraton

“Depending on how the taxes are imposed, it could affect supply chain and building cost. That will slow development down and impact the prices we charge our guests.”
-Mitch Cohen – Jersey Mike’s Subs, Sola Salons Studios

“Multi-unit franchisees will have to pay close attention to legislative changes that can affect their business, impact consumer demand, and affect talent management. Franchisees will have to be even more strategic about growth opportunities going forward.”
-Paul Booth, Ace Hardware

What are some ways multi-unit franchisees can prepare their businesses for 2025?

“I think leveraging technology and all the new tools coming out in the next year will have a very positive impact on multi-unit franchisees. Franchisees need to embrace the digital transformation that is happening right now. They must be focused on all aspects of customer engagement. Regulations will be easier to manage with all the new tools available for cybersecurity, AI, etc. Three key aspects that franchisees can focus on are standardizing processes, using automation to their advantage, and using centralized management tools that are readily available today.”
-Karim Khoja – Comfort Suites, Four Points by Sheraton

“I am sure you all have heard this before, but cash is king. I would be budgeting extra for an increase in cost and labor. I would be looking at beyond 2025 and what we can do as an industry to continue to grow in a cost-effective way and to expand our labor force.”
-Mitch Cohen – Jersey Mike’s Subs, Sola Salons Studios

“Multi-unit franchisees should meet with all their professional service providers such as accountants, financial advisors, etc. to create a plan for the year and discuss their potential goals and opportunities. Franchisees also need to be aware of the direction their brand is going so they can stay ahead of the curve.”
-Paul Booth - Ace Hardware