Retailing has long prospered as one of the world's leading industries on the strength of a simple business model: Retailers sell products for more than it costs them to buy, inventory, market and merchandise the same products.

Sometimes the margin of profit they record on those sales is miniscule. But if they sell in large enough volume, those razor-thin margins add up to a substantial bottom line.

The retail sector is often described as a mature industry. Indeed, the exchange of goods and services for currency or something else of value has been the bedrock of the world's economy throughout most of recorded history. In the case of retailing, however, maturity does not mean it is an industry lacking in new opportunities-especially where franchising is concerned.

Total retail sales in the U.S. reached more than $3.9 trillion dollars in 2006, according to estimates from the U.S. Census Bureau. That represents growth of 5.7% for the year, down a bit from previous years but still solid. Given the historically moderate inflation rate of the past several years, the difficulties of the sub-prime mortgage market collapse and weakness in the residential real estate market, growth in retail sales has been quite impressive.

A number of factors are behind that encouraging performance, including:

At the same time, the parameters defining the retail industry itself have been expanded with the emergence of new channels of distribution. Direct selling through Web sites, catalogs and TV shopping networks is creating new opportunities for cross-channel and multi-channel retailing. Internet sales topped $100 billion in 2006, up from just $30 billion in 2001. Market researcher JupiterResearch projects $144 billion in online sales by 2010.

Several trends are in place that should contribute to continued growth in the retail sector over the short term. Interest rates remain at comparatively low levels, and consumers continue to have access to a substantial amount of credit. The rate of new job creation has been rising, and unemployment levels have remained relatively low. There have been few signs of any dramatic increase in inflation, and the personal savings rate is subdued, which means people are spending money.

There are also some areas of concern to retailers and those considering buying a retail franchise. Consumer confidence has been on a downward track, and the correction in the residential real estate market continues.

A number of questions dog the labor market, including the looming retirement of Baby Boomers in large numbers and unresolved questions about immigration. Continuing conflicts in Iraq and Afghanistan are also contributing to a sense of unease among many consumers.

Retailing has always been an intensely competitive industry, and that is not going to change any time soon. In fact, competition in the retail world today is probably tougher than it has ever been.

Superstores and category killers have made things difficult for mom-and-pop stores and smaller chains. Big operators leverage economies of scale to offer shoppers a deeper selection of merchandise at lower prices than their smaller competitors can provide. That is a strategic advantage that is very difficult for other retailers to overcome.

Retailing may have a long and distinguished history, but it is not immune to change. According to Plunkett Research Ltd., there are 10 trends anyone interested in retailing must know to survive.

1. "Lifestyles of Health and Sustainability (LOHAS) are creating opportunities for new products and services. Significant marketing and positioning opportunity is occurring due to shifts in consumer tastes and demands.

"There are also shifts in budget priorities taking place," said Jack Plunkett, the research company's chief executive officer. "Consumers will pay for more for environmentally friendly products and services, for example."

Along with opportunities for new products and services, other factors influencing the LOHAS trend include evolving design, construction and regulation priorities and concerns about the conservation of energy, water, air quality and public lands. This is accompanied by growing interest in organic products.

2. Population shifts, especially those affecting Baby Boomer and Generation Y, are creating major marketing opportunities in the retail sector. The more than 78 million Americans born between 1946 and 1964 are entering a period of their lives when they will need specialized products, services and infrastructure.

In some cases, that means an affluent target market that is ready to travel, buy vacation homes and otherwise wield the discretionary spending power that comes from high incomes and high household net worth. Generation Y, sometimes called the Echo Boomers, represents a market consisting of well-educated consumers who have growing incomes and are eager to spend. The oldest of the 75 million Americans born between 1977 and 1997 are just hitting 30, and many are ready to buy and furnish their first homes.

These consumers live a fast-paced, mobile, digital lifestyle. They embrace new technologies and leading-edge products and lean towards LOHAS, according to Plunkett's research.

3. Ethnic markets are growing in population, income and importance in the U.S., representing an immense retail opportunity. The Hispanic population is the fastest-growing segment overall, and immigration continues at a rapid pace. The 45 million Hispanic-Americans living in the U.S. in 2007 represented 15% of the population; those figures are projected to climb to 25% and 100 million by 2043.

Changing population patterns will be evident worldwide over the coming years, with aging and shrinking populations in some areas creating unique global challenges and shortages of workers.

While the U.S. population is projected to grow 37% to 420 million by 2050, the European Union population is predicted to remain virtually unchanged at 450 million, while Japan's population is forecast to shrink by 12% to 110 million.

Today's global population of 6.5 billion will mushroom to more than 9 billion in 2050, with just nine nations accounting for 50% of that growth.

4. Health care costs will soar, presenting challenges not only to retailers, but to employers in all industries. Current health care costs of $2.3 trillion a year ($7,500 for every man, woman and child) in the U.S. account for 16% of the country's gross domestic product (GDP). The cost continues to grow, projected to hit $4 trillion and 19% of GDP by 2015.

Plunkett predicted that individuals and employees will bear a greater portion of health care expenses in the future, while developments such as personalized medicine and molecular diagnostics will dramatically alter the landscape. There will be an emphasis on early diagnosis and intervention, and care will finally go digital. 5. Energy costs are creating a sea change in the retail environment. While retailers have to deal with rising energy costs, the shift is opening up huge opportunities for energy-efficient products, and energy technologies are moving to the forefront.

Those venturing into the retail field should expect an emphasis on efficiency, green buildings and smart systems. Consumer preferences and tastes in cars are likely to change, and interest in solar, wind and safer nuclear technologies will increase.

Some alternative energy sources, such as synthetics, ethanol and liquid natural gas, will be adopted quickly. Long-term solutions for additional energy resources will include deep sea wells, tar beds, oil shale and cleaner-burning coal. Businesses and consumers alike must budget for higher costs ahead. 6. Off-shoring and globalization are creating both challenges and opportunities for retailers. This trend is enabled by advances in telecommunications and transportation, and it is creating new opportunities, especially among the growing middle and upper classes in India and China.

The emphasis in this area is on collaboration, research and development and captive off-shoring. Both India and China benefit from massive technology school graduate bases, and the governments of the two countries tend to target specific sectors, notably biotechnology and information technology.

America's role in this trend is evolving, but a clear offshoot for retailers is that U.S. consumers and businesses benefit from lower prices.

7. The "Third Screen" is surging, and wireless transactions grow rapidly. Wireless technologies and mobile computing are expanding their capabilities, bolstering the importance of "Third Screen" devices such as cell phones and personal digital assistants (PDAs). Television and computer monitors represent the first two screens in this paradigm, but the combination of better technology, more content and greater mobility is fueling Third Screen growth. Standard 802.11G Wi-Fi already is widely available, and next-generation WiMax, which will expand the range of mobile devices up to 30 miles, is expected to boom.

Each year, more cell phones are sold than any other type of consumer electronics device - 800 million in 2007 alone. The number of cell phone users in the U.S. already surpasses 210 million, a number equal to two-thirds of the nation's population. The majority of new cell phones hitting the market today come with Internet capabilities built into them.

Wireless presents many marketing opportunities for retail business owners in the 21st century. They can advertise on cell phone screens, sponsor mobile video feeds, participate in active text-messaging campaigns and pursue location-based advertising programs.

8. The Convergence Age is already upon us, as broadband prices continue to fall, opening up high-speed online access to rapidly increasing numbers of consumers. The combination of falling broadband prices and the growing use of wireless devices means that critical mass has been achieved in this area, and service offerings are proliferating, according to Plunkett Research.

More than 60 million U.S. homes and businesses subscribed to high-speed Internet connections in 2007, and the mass market tipping point has been reached. Over the next five to eight years, 80 million to 100 million homes will enjoy high-speed Internet access, and "always on" will emerge as the accepted standard.

Convergence is creating tremendous changes in the area of financial services. The cell phone is becoming a virtual credit card and debit card - a "virtual wallet" that consumers can use to pay for all kinds of purchases. Before long, cell phone-based access to all types of account information will become the industry standard.

For retailers, this trend presents key opportunities for those that can create seamless synergies among multiple channels of distribution: bricks, clicks and catalogs. 9. Advertising is moving online, another offshoot of the convergence effect. As this trend unfolds, marketing demands more effort on the part of retailers, but the payoff is greater opportunities. "The possibilities for niche ad targeting are exceptional," Plunkett said, and such targeted advertising is particularly valuable to smaller retailers who lack the resources to compete head-to-head against the national advertising campaigns of giant retail chains.

As online advertising revenues surpass a projected $17 billion in 2007, search engines and Web sites are evolving into powerful advertising channels. Retailers have more opportunities to reach more consumers in a more accurately targeted manner than ever before.

10. Longer-term, look for miniaturization and nanotechnology to play bigger roles. Miniaturization will make possible more-powerful processing chips, which in turn will enable enhanced electronic devices at bargain prices.

The cost of data storage has plummeted, with a 250 gigabyte hard drive costing less than $90 in 2007. Apple's popular iPod music and video player routinely sports 80 gigabytes of storage, and faster devices with even more storage are on the horizon.

Farther out, the convergence of nanotechnology with information technology will create extremely powerful semiconductors sporting up to 500 million transistors each. Better wireless networks will increase the value of enhanced mobile and personal devices, and embedded computing will detect the presence of personal portable devices. Eventually, the devices will learn their users' habits.

For would-be franchise owners searching for retail opportunities in the here-and-now, there are several things experts say they should keep in mind when weighing individual franchise offerings.

"One of the first things you have to look at is whether the franchise company has a design concept," suggested Russell Freese, a principal in R&D Consulting who has spearheaded redesign projects for franchise retail chains during his almost 30 years in visual merchandising, store design and product development. "Another thing to pay attention to is the merchandise it sells. Some prospective franchisees pay so much attention to store design and the franchisor' requirements for ownership that they forget this is all about selling something," Freese said. "Merchandise is king in retailing, and that will never change."

Freese offered some other suggestions useful in conducting a search for a retail franchise: