The typical franchise, when compared to an un-affiliated business, is more profitable. As a result of extensive surveys conducted by the International Federation Association tells us that:- 93% of the franchisees say that a franchise gives them an advantage
- 88% recommend a franchise over a non-franchised business
- 83% are happy with their franchise
- 65% would purchase the same franchise over again
- The average yearly income for a franchisee is $91,630
- The average net income for a single unit franchise is $76,000
- The average net income for a multi-unit franchise is $142,000
There are many reasons to start a business through franchising rather than an individual start-up.
- Name recognition
- Ability to expand easily
- Greater buying power due to mass purchasing
- Start-up training
- Ongoing support of franchise company
- Low start-up costs
- Higher potential for asset appreciation
Statistics support these notions:
- It is estimated that up to 6000 franchise companies operate in the U.S.
- 75 industries use franchising to distribute goods and services to consumers.
- Nearly 50% of all retail sales come through franchising.
- One in twelve businesses are a franchise.
- Average initial investment level for nearly 8 out of 10 franchises, excluding real estate, is less than $250,000.
- Nearly 86% of all franchises opened in 60 industries during the past 5 years are still under the same ownership.
- Over 300 franchises are sold every week. Or… every 8 minutes of a typical week a new franchised business is started.
- 750,000 franchised businesses in the U.S. generate almost $1 trillion each year.
- In 2000, the median gross annual income, before taxes, of franchisees was in the $75,000 to $124,000 range, with over 30% of franchisees earning over $150,000 per year.
Franchise businesses account for 42% of all retail sales in the United States.
Franchise businesses employ more than 8.5 million Americans.
A 1999 study by the United States Chamber of Commerce found that 86% of franchises opened within the last five years were still under the same ownership and 97% of them were still open for business.
A U.S. department of commerce study conducted from 1971 to 1997 showed that during that time less than 5% of franchise businesses were closed each year.
Compare that to a U.S. Small Business Administration study conducted from 1978 to 1998, which found that 62% of non franchised businesses closed within the first 6 years of their existence due to failure, bankruptcy, etc.
There can be no doubt that in many cases opening a franchised outlet is a safer career move then taking a job with a Fortune 500 company!
