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Jörg Veil can't believe it.
"To be honest, I am very surprised that there aren't many more companies with a business model like the one we have," says the managing partner of Home Instead in Germany.
The Cologne-based company offers people in need of help and care home care - everything beyond medical care.
Thousands of other private nursing and care services are registered in this country, i.e. companies outside of charities such as Caritas or Diakonie.
Home Instead is almost the only company that has organized care as a franchise system.
“There are definitely 15 to 20 such companies in America,” says Veil.
And in Great Britain there are easily ten.
“But of course I don't want to complain that it's so different here.” Because Home Instead has grown by leaps and bounds since it was founded twelve years ago, mostly in the middle double-digit percentage range.
“We have long been by far the largest provider outside of welfare,” says Veil.
Home Instead now has 140 branches with a total of 10,000 employees across the country and serves over 40,000 customers per month.
And Corona has not slowed the medium-sized company's growth path.
Veil reports 30 percent more customers and 30 percent more sales for 2020. And the development should be similar in the current year.
Especially since 20 more partner companies are planned.
"Franchise and the systematic concept behind it makes us so strong and allows rapid growth," says Veil, who has a master's license from the American parent company for Home Instead and whose development work has already received several awards in this country.
Source: WORLD infographic
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Home Instead is one of the growth drivers in the medium-sized franchise economy as a whole.
And it has had another strong year in Germany despite Corona.
This is shown by current figures from the German Franchise Association (DFV), which are exclusively available to WELT.
According to this, the turnover of the approximately 930 system operators increased by almost five percent to 135 billion euros.
Since 2015, revenues have even increased by more than 36 percent.
The income is distributed among almost 177,000 businesses from almost 139,000 franchise partners.
This means that there were around 5,000 new start-ups in 2020, according to the DFV.
The number of employees grew by 4.5 percent to around 750,000.
And the trend is likely to continue.
"During the crisis, we are seeing a very high demand for advice and start-up support," says DFV managing director Torben Leif Brodersen.
And it's not just about the classic franchise sectors such as gastronomy, retail or services.
"There are also quite a few newcomers," says Brodersen.
For example, social enterprises, self storage providers, and even funeral homes.
"This is proof that franchises are popular in branches of the economy that were previously rather fragmented."
Student aid and pet food are increasing
Brodersen suspects the franchise systems' resilience to crises as an incentive.
“The resilience is very pronounced.
This is where the network concept pays off again in the crisis and thus in the search for problem solutions. ”Added to this is the often high brand awareness of franchise companies, which is particularly attractive to customers in times of crisis.
This is also confirmed by science.
"The concept of franchising has proven itself in crisis mode and has clearly demonstrated its strengths, namely cooperation and partnership," says Achim Hecker, Director of the Digital Business University of Applied Sciences (DBU).
Source: WORLD infographic
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Of course, the pandemic has also left its mark on the franchise industry.
The gastronomy in particular, but also the sports and leisure sector, suffer massively from the consequences of lockdowns and, last but not least, from the uncertainty of customers.
However, this area only represents around a third of all franchise systems.
The services segment is significantly larger.
And according to the DFV, there were hardly any negative corona effects there.
The situation is similar with construction and handicrafts, which includes at least one in ten franchise businesses in Germany.
However, specialist retailers with a special focus were also strong, above all hardware stores and tire dealers as well as kitchen studios and baby markets and, last but not least, pet shops.
The company group Das Futterhaus, for example, reports a sales increase of almost 13 percent to 452 million euros for 2020 - one of the highest increases in recent years.
And that mainly on existing space.
Because a large part of the actually planned new openings were postponed to 2021.
"This shows the important role pets play in difficult times, but also the importance of stationary specialist retailers for pet owners," says Sales Manager Andreas Schulz.
The mood in the entire industry is therefore hardly any worse than it was before the crisis.
At least that's what the so-called Franchise Climate Index (FKI), which the association collects twice a year, shows.
While this FKI was still at a value of 145 percent at the end of 2019, it plummeted significantly in the first half of the year and is now back at 138 percent.
At the same time, the perception of negative corona consequences has also decreased significantly.
If 56 percent of the respondents spoke of negative effects in the survey for the first half of 2020, the figure is now 37 percent.
At the same time, 35 percent of companies say that Corona even has a positive effect on their business.
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Marion Lauterbach is also in a good mood.
She doesn't want to call her company a “corona winner”.
The business model has proven to be crisis-proof, says the franchise division manager at Schülerhilfe.
“The need is there.” The tutoring organization from Gelsenkirchen operates around 1,100 locations nationwide, half of them in the franchise system.
10,000 teachers tutor over 100,000 students, especially in German, mathematics and English.
“These were very stable values recently,” says Lauterbach.
This help is currently provided by distance training on the computer.
Bankruptcies could especially affect individual restaurateurs
As soon as possible, face-to-face learning should be offered again.
"The parents are satisfied, but the students prefer personal contact," reports Lauterbach, who is expecting a significant increase in demand from the summer.
"Because there are currently large gaps in many pupils," says the expert, referring to a study according to which children and adolescents spent around two hours a day at home with school topics in the first lockdown in spring.
“In everyday school life it is usually five to six hours.
That leaves traces. "
The student aid is therefore already preparing for a hot autumn, which is considered the main time for exams.
"We are already approaching potential teachers," says Lauterbach.
But even in the summer holidays there could be demand that is otherwise not necessarily there.
"Corona has uncovered the weak points in the school system and again shown the value of education."
Mirko Silz is also hoping for summer and autumn - but from a much worse starting position.
The entrepreneur has been running the L'Osteria restaurant chain since autumn 2016, which includes 132 inns, around two thirds of which are operated by franchise agreement.
"The situation is dramatic," says Silz frankly.
His company loses 150,000 euros every day in lockdown.
"So we are rightly complaining in the restaurant business."
Especially since the industry got into this situation through no fault of its own.
Silz is now expecting thousands of bankruptcies in his industry - but primarily among individual restaurateurs.
“Systems are stronger in a crisis”, the entrepreneur is convinced and refers to a know-how and knowledge transfer in the franchise groups.
"Many measures and ideas that we have now implemented for all restaurants came from the affiliated partners."
This includes, for example, an app, our own web shop and our own delivery structures to make you independent of the usual delivery services and their high fees.
But also an FFP2 mask campaign for customers.
Silz therefore remains confident despite fears about the future.
“The consumer opts more and more for the systems.
We therefore expect a boost as soon as the guests are allowed to go to the catering trade again. "