Why Franchises?
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 franchises 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 franchises.
- 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.
But nothing speaks louder than the U.S. Department of Commerce
Seven Year study of Franchise vs. Independent Start-Up Success Rate:

According to the U.S. Department of Commerce, franchise businesses are exponentially more likely to succeed than individual new start-ups, particularly if you look at the figures over a five or seven year period. According to Department of Commerce figures, after seven years 91% of new franchises are still in business, as compared to only 20% of individual new start-up businesses.
The Future of Franchising:
Within the next 10 years, franchises will comprise over 50% of the retail economy and employ millions of people. This growth should be anticipated based on the simple logic of the underlying concept. Franchises offer success to aspiring, new business owners with the least amount of risk. These systems will enable hundreds of thousands of new business owners to realize the dream of successful business ownership and financial independence. Like the US and world economies, franchises are evolving. There will be even greater opportunities for wealth creation among both franchisees and franchisors as this evolution progresses. New franchises will be developed while the existing systems become more fortified and continue to grow.