February 5, 2025

IFA Releases 2025 Franchising Economic Outlook

Today, IFA released its annual Franchising Economic Outlook showing that franchise growth exceeded projections for the past year and will once again outpace the growth of the broader economy in 2025. On top of the 2.2% growth experienced in 2024, which exceeded the 1.9% projection, the report forecasts that franchises will grow an additional 2.4% in 2025, a faster rate than the 1.9% projected for the broader economy by the Congressional Budget Office (CBO).

Dig deeper: The full report is available here, and key findings include:

• The number of franchise establishments will increase by more than 20,000 units, or 2.5%, to 851,000 total units.
• In 2025, franchising is expected to add approximately 210,000 jobs, growing at a rate of 2.4%, bringing franchising employment to more than 9 million jobs.
• Total franchise output is projected to exceed $936.4 billion in 2025, increasing by 4.4%, from $896.9 billion in 2024. Franchise GDP now constitutes 3% and will increase at a pace of 5% to $578 billion.
• Personal services and retail food, products, and services are expected to be the fastest-growing industries in 2025.
• The top 10 fastest-growing states for franchise growth are: Georgia, North Carolina, Virginia, Arizona, South Carolina, Pennsylvania, Tennessee, Florida, Colorado, and Maryland.

Our thought bubble: For IFA members growing their brands, 2025 is poised to be a banner year, and franchising remains a major driver of growth and upward economic mobility. Read more here and share the report. 

Haller: Let’s Export Georgia’s Success

IFA President and CEO Matt Haller penned an op-ed in the Atlanta Journal Constitution this week outlining one key policy change that would export Georgia’s franchising success nationwide.

Go deeper: Touting former Georgia U.S. Senator Kelly Loeffler (R-GA) to be the next Administrator of the Small Business Administration (SBA), Haller wrote that Georgia is consistently a top state for franchise growth. As the home of more franchise brands than any other city in the country, Atlanta has earned the distinction as the franchising capital of the United States.

Our thought bubble: In his column, Haller urges the SBA, where an estimated 20% of all loans go to franchises, to re-institute the franchise directory a centralized and verified location for lenders to quickly and accurately check a franchise’s eligibility for SBA financing.

Trump Administration Levying Tariffs

Key countries are responding to the Trump Administration’s new year tariffs, as Mexico and Canada on Feb. 3 reached separate agreements with President Trump to pause tariffs on their exports to the U.S. for 30 days after Canada agreed to put 10,000 front-line personnel on its border with the U.S., while Mexico agreed to supply 10,000 Mexican soldiers on the Mexican border.



Zoom out: Tariffs of 10% went into effect on Chinese goods effective Tuesday February 4, while Beijing announced retaliatory 10%-15% levies on select American goods, including coal and liquefied natural gas, crude oil, agricultural machinery and pickup trucks, effective February 10.

What’s next: The trade landscape is fluid, and IFA will host a webinar this month on how tariffs may affect U.S. franchised businesses. Registration link to follow.  

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CTA Reporting Deadline Extended

Although SCOTUS struck down the injunction against the Corporate Transparency Act (CTA) taking effect last month, FinCEN announced that filing requirements remain on hold so long as a second injunction issued by another Texas federal court remains in effect.

Dig deeper: In a letter to U.S. Treasury Secretary Scott Bessent, IFA urged further extension of the CTA filing deadline until at least January 1, 2026, citing the confusion from the various court rulings regarding when business owners must comply with Beneficial Ownership Information (BOI) reporting requirements and whether they must comply at all. 

Our thought bubble: IFA will continue supporting a repeal of the unconstitutional CTA, which would require nearly all franchised businesses to file an annual BOI report with FinCEN, and whose reporting burdens and excessive penalties will be shouldered by law-abiding Main Street businesses. 

NASAA Updates Non-Compete Guidance

On January 27, the North American Securities Administrators Association (NASAA) issued new guidance on post-term non-compete clauses in the context of the franchise business model, which have been a subject of interest in recent years from the Federal Trade Commission (FTC). 

Get smarter: Noncompetes in franchise agreements typically address competition both during the term of the franchise agreement and following expiration or termination of the relationship.



The big picture: NASAA’s guidance, available here in its entirety, concludes that post-term non-competes should be narrowly drawn and reasonable in scope, duration and territory.

Virginia Franchise Legislation in House Labor & Commerce Committee

SB 798, legislation spearheaded by Virginia State Sen. Chris Head, has been referred to the House Labor & Commerce Subcommittee #2. The legislation, which imposes the most severe restrictions on non-compete clauses in franchise agreements than any other state, will likely receive a hearing in the next few weeks. The bill would also force all contracts or agreements after July 1 to be governed by Virginia law. 

What's next: IFA has been meeting with members of the House subcommittee and key members of the House, including Speaker Don Scott, to educate members on the harmful impacts of the bill. 

Zoom out: Democrats have majority control in committee, and Sen. Head's bill was tabled in a House Labor & Commerce subcommittee last year on a party-line vote. 

Franchising in the Halls of Congress

IFA member and CEO of Markarie, Shawn Goldsmith, was recently named a strategic adviser to U.S. Rep. Rich McCormick (R-GA). In his new role, he’s been highlighting the positive impact of franchising in Georgia.

Dig Deeper: Goldsmith recently met with Rep. McCormick and U.S. Rep. Beth Van Duyne (R-TX), a co-chair of the Congressional Franchise Caucus, in Washington, DC.



If you would like to be more involved in IFA Advocacy and meet or host a lawmaker in your area, please reach out to IFA’s SVP of Advocacy Erica Farage.

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