Upbeat IFA Report On Franchising

The franchise industry is showing more signs of recovery from the recession. An index compiled by the International Franchise Association rose 0.5 percent in September, its second straight monthly gain. The index is also up 2.2 percent from September 2011.

The improving economy, including a drop in the unemployment rate to 7.8 percent last month, helped lift the index, according to the IFA, a trade group representing the franchise industry. It also said loans are slowly becoming easier for small businesses to obtain. Most franchises — for example, an individual Subway or Jiffy Lube — are small businesses.

The IFA also issued its outlook for the franchise industry. It expects the number of individual franchises to grow by 1.5 percent this year. That’s down from a forecast of 1.9 percent made earlier this year, before the economic recovery slowed. But the expected addition of nearly 11,000 franchises will be the first since increase 2008. Last year, the number of franchises in the U.S. fell by nearly 4,000. Since 2008, there has been a loss of more than 23,000 franchises.