Franchise Your Business

Breaking Down Franchise Sales: July 2025 Market Pulse

Big Sky Franchise Team | Tom DuFore

This is a recording of a live webinar recorded on July 11, 2025, starting at around 1 PM Eastern Time USA.   

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Links from the episode are here:   

  1. https://www.ismworld.org/supply-management-news-and-reports/reports/ism-report-on-business/ 
  2. https://www.ismworld.org/globalassets/pub/research-and-surveys/rob/pmi/beef202506pmi.pdf
  3. https://www.ismworld.org/globalassets/pub/research-and-surveys/rob/nmi/uglyrob202506svcs.pdf
  4. https://www.ismworld.org/globalassets/pub/research-and-surveys/rob/hospital/2h0trob202507hos.pdf
  5. https://tradingeconomics.com/united-states/inflation-cpi
  6. https://tradingeconomics.com/united-states/unemployment-rate
  7. www.sca.isr.umich.edu
  8. https://www.census.gov/econ/bfs/current/index.html
  9. https://www.census.gov/econ/bfs/current/index.html
  10. https://www.vistage.com/vistage-ceo-confidence-index/
  11. https://www.vistage.com/wsj-small-business-index/
  12. https://www.uschamber.com/sbindex/summary
  13. https://www.franchiseinsights.com/franchise-development/feedback-from-prospects-on-the-franchise-sales-process/
  14. https://www.franchiseinsights.com/small-business-startup-sentiment-index/strong-showings-by-baby-boomers-and-current-business-owners-in-june-sentiment-survey/
  15. https://www.linkedin.com/newsletters/franchise-insights-and-news-6987728206669774849/
  16. https://www.franchiseinsights.com/top-ten-business-opportunity-categories/

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Tom DuFore:

All right, everyone. Thank you so much for joining us here on another edition of our Franchise your Business webinar series. Again, my name is Tom Dufour. I'm the founder and CEO of Big Sky Franchise Team and our session today is much like we've been doing almost monthly now for about four years, which is the current franchise sales and marketing trends and, as folks are loading into our session here, this is a live recording. By the way, we're recording this here on July 11th, so 2025. So happy 7-11 day here. And for those of you that end up listening to this on audio only, I am wearing stars and stripes today a red polo with a navy jacket with white stars on it to commemorate Independence Day. For the 4th of July. So happy belated 4th of July, as we're celebrating that here. Now to get into the topic at hand today for our session.

Tom DuFore:

If you're new to us or this is the first session you've ever been to like this, or maybe this was passed along to you for a link, or maybe you found us on a search, a Google search or something our sessions here, these webinars that we do and podcasts that we record specifically for this version is available for you to subscribe to our YouTube channel, which is just Big Sky Franchise Team. Look us up there. Please subscribe to our YouTube channel to get these regular updates. We have over 600 videos and pieces of content on there that's all readily available. And then please subscribe to our podcasts. The first podcast is the Franchise your Business podcast, where this live session will be posted and published over the next week or so. And then the second podcast is called Multiply your Success. That's Multiply your Success. We have over 260 episodes. We just celebrated our five-year anniversary on that podcast and we just have some super, super guests. It's a high production and high-quality production that we produce over there, with relevant topics for you to learn and hear about for, uh, franchising, uh, for growing a small business. And, as I'd like to remind you, we do offer a free consultation to anyone that does listen into this. So, if you are thinking about franchising your business and you have some questions specific to what you're doing, or you are a franchisor at any stage, whether you're emerging or growing or a mature franchise system, we'd love to spend a little bit of time with you to see if there's something we can help you with or maybe sometimes it's just getting another opinion. There's no cost for that consultation? No obligation. We'd love to chat with you and connect. So, with that being said, I'm going to go ahead and open this up to share my screen as I pull up the images. There we go, and now we're going to go ahead and share, okay.

Tom DuFore:

So our first reports that we like to take a look at that should be appearing on here is from the Institute for Supply Management. They publish monthly reports on the manufacturing PMI, services PMI and hospital PMI. Pmi stands for Purchasing Managers Index. So the first report is prepared by Susan Spence and this is from the. Here we go, I'm trying. It reads the manufacturing PMI registered 49%, 0.5 percentage point higher compared to the 48.5% reported in May. So this is for the month of June, june of 25. Here. Of the five sub-indexes that directly factor into the manufacturing PMI, two were in expansion territory and up from one in May. The slowing of supplier deliveries eased month over month with a 1.9 percentage point improvement, indicating that port congestion and a drawdown of manufacturing inventories has eased, ultimately meaning that overabundance of inventories, port congestion and so on means that these suppliers or these manufacturers and purchasing managers are buying more stuff. So we see this notch up here. So we're going to take a look at it.

Tom DuFore:

But if you're looking on the screen here since the start of 2024, you can see this slow growth trend line, just in general, coming back from actually the end of 2023. We can see right around fourth quarter of 2023 on up to today, for June of 25, that we're taking a look at. We can see that this purchasing managers index has this nice steady increase. Over time. It's been very slow, but it's been relatively steady, so that's a trend line. I think that's worth noting and paying attention to. That. You can just kind of see visually if you're able to see this on your screen. And what I like about manufacturing is it tends to be a leading indicator, meaning we'll tend to see the impact of this 12 to 18 months from now. So what we were seeing, by the way, at the beginning of 2024 is likely just starting to show itself. Between the first of the year to today, we're likely starting to see the impact of that. So I would just say that that, in general, I think is a good indicator as well, as this is something for you to share with your franchisees or prospective buyers when they're saying, well, I'm not sure about the economy. This is one thing that shows a consistent and steady trend line. Now, what does that mean long term? Well, it's hard to say, but in general I think it's a positive sign, all the while also saying that it's at 49%, which is below the manufacturing break-even line, so, and it's right below it. But when I think of that to me, I start thinking well, we're kind of at this mid-range, with a slight positive trend in the right direction.

Tom DuFore:

Okay, let's move on. Because I've been talking about that one for a while here, let's take a look at the second report from the Institute for Supply Management. This is the services PMI. This was prepared by Steve Miller and it reads in June, the services PMI registered 50.8%, a 0.9 percentage point increase compared to the May reading of 49.9%. A reading above 50% indicates the services sector economy is generally expanding. Below 50% indicates it's generally contracting. A services PMI above 48.6% over time generally indicates an expansion of the overall economy. Above 48.6% over time generally indicates an expansion of the overall economy. Therefore, the June services PMI indicates the overall economy is expanding for the 61st straight month, so over five years. It's saying right now that we've been seeing this steady incline here.

Tom DuFore:

And well, I know I mentioned we had our five-year anniversary and just kind of throw a little tongue in, a little fun in for this today. But I think, okay, well, this is going going on 61st straight month. Well, that's right about the time I started my podcast. Multiply your success. I don't know if there's any uh correlation there there, but hey, that's still kind of an interesting point to mark. And I just say that jokingly, jokingly, no seriousness there. Okay, all right.

Tom DuFore:

So when we look at this report, there are quite a bunch of zigs and zags and we see, starting in 23 to about middle of 24, you can see a bit of a trend line going down, and from about mid-24 up until about first quarter of this year there was a pretty good trend up, but with the last three or four months here we can see that the services PMI is trending downward. So now, if we look from the middle of 24 to where we are today, the trend line in general is still looking positive, but a very, very slight upward, almost flat, just up a little bit. Very, very similar, by the way, to what we saw if I'll click back here in the manufacturing PMI, with the difference being that the manufacturing PMI really starts to see a trend over about a year and a half here and it's a little less volatile than when looking at with some of these big spikes and bigger spikes and ups and downs in the services PMI. Overall it's a positive indicator, but this to me is similar to where we've been for maybe the last couple years, two years or so, maybe a little bit more, where it's just been relatively flat. Maybe it's a little down, maybe it's a little up, but generally relatively flat in these reports, from my observation and so to me that just is indicating and telling us that I mean it's kind of steady as she goes, kind of a mindset. It's like, well, I don't know what to really take out of that other than it's kind of steady, for better or for worse, I don't know. I don't know if it's for better or for worse, it just is what it is.

Tom DuFore:

On that regard, okay, next up is for us to take a look at the hospital PMI. I'm going to read from the second paragraph here, starting at the second paragraph in this report that was prepared by Nancy LeMaster, and it reads the hospital PMI registered 49% in June, a three percentage point decrease from the May reading of 52%, indicating contraction after 21 consecutive months of growth. And if you look back here to about the fourth quarter of 23 or the beginning of 24, you can see a pretty steady overarching trend line of it going downward. Now the tail end of 24 were some peak time or, excuse me, tail end of 2023 were some peak periods here in the hospital PMI. But you can see from that time period even if we were to look at the start of this year or halfway through 24, it's trending down and it has been. You can visually see a pretty clear trend line going downward for the last 18 to 24 months and down to this month, or, excuse me, for June, this most recent report, showing below that 50th percentile marker which shows that it's contracting, which shows that it's contracting.

Tom DuFore:

So hospital this is their newest report. It shows some big zigs and zags and it has since it's been published. Again, I just think it's because it's newer. There may be fewer data points that are getting pulled into it, but it's a good indicator given how much healthcare has, how much what the high percentage healthcare has as an overall percentage of our economy. So that is trending down and that trend line is just consistently kind of going in that direction and we're right around middle number again very similar to the other three.

Tom DuFore:

Hospital direction, and we're right around middle number again Very similar to the other three hospital services and manufacturing, all generally showing, in my opinion, relatively flat up, a little down a little. It's been this way for a while. So to me, when I'm thinking of this and interpreting this, maybe for a potential franchise buyer for franchisees in your system, a potential franchise buyer for franchisees in your system, I would look at this and say, well, it's been this way for at least a couple of years. Folks, it's kind of looking at it and saying, well, this is just kind of the. It seems to be consistent with what the norm's been for a while, and so we're just kind of making our way through it.

Tom DuFore:

Okay, next up is the consumer price, or the CPI, or consumer price index, the US inflation rate, and so this is. It actually does not have this is from tradingeconomicscom. It actually does not have the June numbers published here. So we're still looking at May of 24, but May of or, excuse me, may of 25, and May was at 2.4%. So still waiting on what that looks like. But in general, it looks like it's finally really starting to slow down.

Tom DuFore:

Then we have the unemployment rate, and unemployment has been very, very, very consistent, ranging between 4% and 4.2%, and last month, for the month of May, was at 4.1%. It's ranged between 4% and 4.2% every month for a year now, and this is from tradingeconomicscom. They pull their data from the US Census Bureau, but it's just worth noting that this has been steady. Uh, let me click back to the three year. Uh, so if we look back at three year, you know, in June of 2022 is 3.6% employment. It's at 4.1 right now. Uh, so you can see that. Let's look at a five-year, so dating back to about January of 2022, now we're looking at about three and a half years. It's been right in between about that three and a half to 4.2%. It's been very, very, very consistent. So we're talking at this point three and a half years of consistent unemployment at a very similar level.

Tom DuFore:

So what does that mean for your franchise system and sales? In my opinion, what that means is new franchisees coming in are going to be facing the same competition other franchisees have faced for finding quality talent for the last three and a half years. So whatever has been going on or that you've been working on or have found to be working. In my opinion, you're going to want to continue to do that. It also means that at this 4% 4.1%, I mean that's pretty low unemployment rate, and so people are generally the employees are going to have their opportunity to find the right kind of employer that they're looking for. So you've got to figure out what is it and how is it that you are attracting your potential franchisees into the system or, excuse me, potential new hires? What kind of content and information can you help to support or train your franchisees on how to recruit for their local location?

Tom DuFore:

Next up is the surveys of consumers from the University of Michigan, and this is for June of 2025. It says final results for June of 25. The index of consumer sentiment, which is the one I like to look at, shows that there was a big bounce up from May of 2025. So in May, if we look at a year ago, in June of 24, it was 68.2%. So year over year it's down 11%. Month over month it's up 16.3%. And there's a chart off to the right about the sentiment I'm going to zoom in here. Chart off to the right about the sentiment I'm going to zoom in here. That shows since 1990, it shows this chart and we're on an uptick from a pretty heavy decline or drop in the sentiment that occurred that really matched or was right around the lowest number on this chart since 1990. That occurred back in about 2022 or time period midway through 2022 or first part of 2023.

Tom DuFore:

So, anyway, just to give you a little overview on that, to me, what does that mean? Well, it probably means it's a little bit harder to get to a yes right now. Consumer's sentiment means that it might be a little bit harder to get to a yes right now. Consumer's sentiment means that it might be a little bit harder for your franchisees to get sales. It might be a little bit harder for you to sell that franchise prospect. So be prepared to commit some extra time to those potential candidates and understand that they might be considering alternatives or just you might be their number one choice, but they're just a little nervous. They're just taking their time. They're going to hold on to their cash a little bit longer. They're going to delay that. So you might need to be producing extra resources or support to help them make that decision.

Tom DuFore:

Next up is the business formation statistics, and this was released yesterday, july 10th, so I'm glad I didn't do this session any sooner to get this updated and accurate information and what we like to look at. This is from the US Census Bureau and this looks at the total number of new business applications filed nationally. So it takes all the state data and aggregates it. So in June of 2025, there were 457,407 new business applications that were filed. It's just incredible to think that's a 2.2% increase over the month of May. And for those that end up looking at this, if you look starting back in about midway through 2021 or so, there's just a slow trendline growth of new business applications. Almost every month has been more than 400,000 new business applications.

Tom DuFore:

To me, what that should be telling you again consistently is new business startup is on the hearts and minds of Americans and of people looking that are thinking about buying your franchise. So if they're inquiring, you really need to take them seriously that they are starting a business. It might not be your franchise, it might be an independent, it might be another franchise, it might be something, but these folks are thinking about it and they are serious because these applications are getting filed. So there are these steps that are being taken and I just think it's really important. It's easy in the franchise sales process and I know because I've been involved and I've done franchise sales and I know how this process works, sometimes with a prospect that continues to drag their feet or take their time or ask a lot of questions. Sometimes it can be disheartening. But I encourage you to stay the course, keep positive, focus in and embrace this idea of starting a new business and remind this buyer about how your franchise may very well be the right solution to their entrepreneurial, the entrepreneurial itch that they have about starting this business.

Tom DuFore:

Okay, next up, next report is from Vistage. Vistage puts out what they call the Vistage CEO Confidence Index and it reads this is from vistagecom slash Vistage CEO Confidence Index and it reads the Vistage CEO Confidence Index is calculated from responses to a set of six questions about the current and future state of the US economy, revenue and profitability projections, and hiring and investment plans. Measured over time, the index reflects trends in the US economy and leads both GDP and changes to employment. So they do this quarterly. So this is the most recent data that just got published. This is over the last five years.

Tom DuFore:

If you're looking on the screen published, this is over the last five years if you're looking on the screen and it is at 77.2 is the rating, and the highest rating over the last five years was in Q2 of 2021. So we're looking at four years ago it was 108.8. And the lowest reading on this chart was back in Q2 of 2020. It was 65.5. So it has generally been trending up If we look over the last four quarters. If we look at Q2 of 2024, it was at 83.3. So it's down about five points from there. So over the last year we see it generally contracting downward, although we see in Q4 of 2024 was the highest rating. It had been since.

Tom DuFore:

What they're seeing is maybe some of the enthusiasm is waning and settling in a little bit to say, oh well, we thought things were maybe going to get improved significantly and, generally speaking, changes to the economy positive or negative, positive or negative don't happen overnight. There tends to be a trend associated with that. So it looks like this confidence CEO confidence index has settled down. It was below where it was last quarter, which was 78.5. Now it's 77.2. So it's down 1.3 points but generally speaking, still relatively flat. But over the course of the last year, like I was saying, it is a downward trend. So Vistage CEOs are typically owners and founders and leaders of high growth and fast growing small to midsize enterprises. So anyway, it's just worth noting what their sentiment is.

Tom DuFore:

Now the Wall Street Journal also does a small business index with Vistage and it's called the Wall Street Journal and Vistage Small Business CEO Confidence Index and it says the WSJ Vistage Small Business CEO Confidence Index is calculated from responses to a set of six questions about the current and future state of the US economy, revenue and profitability projections and hiring investment plans. Measured over time, the index reflects trends in the US economy. So this is showing over the last five years. Measured over time, the index reflects trends in the US economy. So this is showing over the last five years. And what's interesting and I think is worth noting is if we look at this is done monthly as compared to the previous one, which is done quarterly. And what I find interesting is if we look at over the course of the last quarter. So, on the Vistage report, for that quarterly, it shows that it's trending downward. Okay, that's interesting.

Tom DuFore:

But if we come back now and look at where is it trending right now? Well, we look at June is at 82.9 on this index. May was at 75. April was at 69.7. April was at 69.7. So it shows, and April was at 85.4. So what we see is two months of this index dropping pretty significantly and then popping back up in the month of June. So what I'm thinking here is happening as we start to look at January. This may have an impact from some of the tariff talk and tariffs that have been imposed and all of the changes and uncertainty around tariffs. Really, that's what I see is uncertainty around tariffs. What is going on?

Tom DuFore:

Generally speaking, business markets like things to be relatively stable. I don't know about you, but I generally do. It makes it a lot easier to anticipate and predict or not predict, to schedule or project out long-term investment planning. So it looks like here things are trending back up in the month of June as compared to the previous two months. So I think that as a whole is positive. And then if we look back let me look back to June of 24, it was 91.0. So we start to see some of these trends over time here and just worth help noting to me.

Tom DuFore:

Again, I see all of this as just the economy is just kind of not great, it's just kind of flat. Most of these indicators seem to be down a little, up a little. I don't know quite how to describe it. It's actually hard to describe. It's just relatively flat's the best way for me to describe it, and it has been for at least a couple of years, in my opinion. An observation we have the Small Business Index score. This is put together by the US Chamber of Commerce in partnership with MetLife and this is a report that shows that. I looked at this, we looked at this because they did publish this a little bit before the end of Q2. But this is for Q2 of 25. It shows it's at 65.2. A year ago, 69.5. Q1 of 24 was 62.2. So you can see it's relatively flat. Also, this report, it was trending downward for last year. It may be kind of trending upward here for the second quarter a bit, but again relatively flat over a couple of years. So you know, I think for folks that are considering about buying a franchise, to me what this says is well, if you're looking to do it, it just if you're looking for a better time to do it it's hard to anticipate when that might be and a worse time to do it. You know, it looks like. You know, just kind of a flat time, you know. So it's just, you know, by doing it, the past indicators seem to indicate, or these indicators seem to indicate, that it's going to be relatively flat, maybe down a little, maybe up a little, but generally speaking relatively flat little, maybe up a little, but generally speaking relatively flat.

Tom DuFore:

Okay, next up is from franchiseinsightscom, and this is they've run a couple of reports. This was published July 2nd by Michael Alston for Franchise Insights. It says feedback from prospects on the franchise sales process, and the question they asked was how would you rate your overall experience with the franchises you inquired about? So 11.1% said they were very satisfied, 33.3% said that they were satisfied, 33.3% said neither satisfied nor unsatisfied, 8.1% said unsatisfied and 14.1% said that they were very unsatisfied. So if you look at this and you add up the numbers, it shows that about ballpark, here about 22% of respondents said that they were unsatisfied or very unsatisfied and approximately 78% said that they were satisfied or neutral. They were neutral in there. So I think that's very interesting. More people were satisfied or very satisfied than not, and so that is interesting and to me that's an indicator that says well, franchise sales teams, marketers seems like this is a pretty good report card. There's always room for improvement, but the prospects are saying that the sales process in general is pretty good. It's flown along, it's it's flown along. So, again, always room for improvement. You can always do better, but, um, I think this is just a good indication for franchising as a whole.

Tom DuFore:

Next uh report uh, this was released July 9th, so just a couple of days ago. Um, and this was the the. This was from franchiseinsightscom and it says strong showings by baby boomers and current business owners in June startup sentiment survey. So it shows that the share of aspiring franchisees planning to start up within 12 months is steady. So 88.1% said that they plan to open up their new business within the next year. And it shows that 88.1% of the respondents said that they expect conditions to be the same or better over the next three months. So that's a really good and interesting sentiment from the people thinking about opening a business.

Tom DuFore:

I always like this report. It just shows the percentage share of potential business startups by age. So it shows Gen X is accounting for 48.3%, boomers at 33.3% and Millennials at 13.3%. So Gen X continues to be right about half of all franchise of budding entrepreneurs and likely probably going to be the case with most of your franchise prospects, or probably about half of them, are going to be Gen X. So just worth noting there.

Tom DuFore:

One other interesting point here from this report that gets published it shows that 40 of the people that are considering buying a business or buying a franchise, 44.8% are leaving full-time jobs and 23.9% are existing business owners, 19.4% are freelancer consulting and 11.9% are part-timers. So what's interesting to me is you almost have these two differing messages. One is targeted to that employee to say which is the message that's resonated with franchising for decades be the captain of your own ship, be your own boss, kind of an idea for buying a franchise. But then you have roughly 43% or so of buyers that are some kind of existing owner, whether as a freelancer or a business owner, and your messaging might need to be a little bit different, where you're talking a little bit about how buying a franchise can either diversify their business investments or, number two, how their business, how buying your franchise, can become an alternative to the current business that they're running. Maybe their current business they're running or doing just isn't going the way that they would like for it to. So just some food for thought in that regard.

Tom DuFore:

So the last section I always like to show is the top 10 business opportunity categories from FranchiseInsightscom, and this says the following business opportunity categories showed the greatest inquiries in the last 90 days. And so the number one category and it's been this way for a while here is home services, accounting for 27.4% of all inquiries from people looking to buy a business opportunity. And now business opportunity includes franchises and other types of business opportunities. Number two on the list is business services, at 19%. Business services at 19%. Number three is senior and healthcare at 8.8%. Number four is pet services Pet has really been increasing a lot at 7.8%. Number five is cleaning and maintenance at 7.4%. Number six is food and restaurants at 7%. Number seven is automotive at 3.6%. Number eight is child-related at 3.3%. Number nine is retail at 2.9%. Who said retail's dead? 2.9% of franchise buyers are considering retail. And number 10 is health and fitness at 1.9%. So the key takeaways here is that if you are in the top 10 categories here, chances are it's going to be easier for you to generate leads or find leads, and if you're in the top five categories it's going to be quite a bit easier. And if you're in that number one category or number two category, because home services and business services are head and shoulders farther along than the other eight categories. If you're in home services or business services, it should be relatively easy, comparing to the other categories, to generate leads, which means you're. It also means that you might be generating a lot more tire kickers as coming through as well, but it should be easier as a whole, and so that is the session today.

Tom DuFore:

I'd love to open this up for any questions for anyone that's listening to us live, and while we're waiting, I just want to give a quick reminder, please, to us live. And while we're waiting, I just want to give a quick reminder, please, please, feel free to request from us for a free consultation If you're thinking about franchising your business or need help growing your franchise system, or just need a second set of eyes to come in and analyze what's going on or not going on in your franchise system. We'd be happy to do that. You can visit us at bigskyfranchiscom and, uh, I'm not seeing any questions come in here, so just want to thank you all for being here. Uh, as we are full throttle in the summer months and hopefully, uh, you've got a vacation planned or uh, maybe you're on one already, but, um, hopefully you get some time to just uh, uh, just rest and reset to come back fully charged. Thanks everyone for being here. Have a great rest of your week and weekend. Talk to you soon. See you next month.

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