"Franchise Business Expected to Grow Due to Increased Unemployment from COVID-19 Impact"

NH Investment & Securities Report, GS Retail & F&F Recommended
Textile and Apparel Industry Online Shift...Growing Interest in Major Brands

[Asia Economy Reporter Minji Lee] Opinions have emerged that structural growth in franchise business is expected due to the rise in unemployment caused by the shock of the novel coronavirus infection (COVID-19).

According to NH Investment & Securities on the 14th, the distribution industry is expected to see an expansion of self-employment among youth and housewives due to the structural rise in unemployment caused by COVID-19. Additionally, franchise business is anticipated to gain attention due to the expansion of consumer needs driven by the standardization of products and services.

Ji-young Lee, a researcher at NH Investment & Securities, said, "In the second half of this year, household income is expected to stagnate due to the continuation of COVID-19 and the global economic slowdown, worsening consumer sentiment," adding, "Interest in GS Retail, the largest franchise operator, is expected to increase with the expansion of franchise business."

The textile and apparel industry continues to move online. With the expansion of online services and the spread of contactless consumption, the online penetration rate is expected to rise to 30%. Accordingly, the global fashion market in the online environment is predicted to experience intensified polarization, where companies with high brand awareness gain greater value.

Researcher Lee said, "Large brands with their own customer attraction power are reducing sales commissions, which account for 30-50% of sales, through sales on their own online malls, and are reinvesting these profits back into their brands," forecasting, "We recommend F&F, whose brand awareness is rising in both domestic and international markets."

This content was produced with the assistance of AI translation services.