Franchise Statistics

If you are a person who is on the run to become an entrepreneur, then probably you would have also considered owning a franchise. As an industry, franchising has been around for a long period of time. Although it was deemed as a failure during its initial stages, it later trod on and has created an own path for itself. The desire to expand has fuelled every franchised operation.

Globally, the franchise industry is skyrocketing and is achieving incredible milestones in terms of business. Join us in a journey through this article as we explore some of the most recent and important franchise statistics.

On this page, you’ll find:

• General Franchise Statistics
• Economic Impact of Franchises
• Franchises in the U.S.
• Franchise Investment
• Franchise Employment

Key Franchise Statistics

Here is a list of the top 10 statistics from this article:

• Every year, an average of about 300 companies start franchising. (Frankart Global)
• Limited-service restaurants, gas stations, full-service restaurants, hotels/hospitality, and new car dealers are the types of franchises with the most business units. (U.S. Census Bureau)
• About 3% of the national GDP is accounted for by franchise accounts. (IFA)
• Providing a cumulative economic output of $757.2 billion, the total number of franchise establishments is 7,59,240. (Frankart Global)
• More than 300 different industries comprise the U.S. franchise sector. (U.S. Census Bureau)
• The USA has 750,000+ active franchised outlets. (Goldstein Law Firm)
• An initial investment of about $250,000 is required for more than 50% of all franchises to open. (Frankart Global)
• In 2017, 152 public-to-private deals were signed. (Financial Times)
• In the U.S., franchises employ more than 8 million people.
• Although most franchise owners are men, between 2011 and 2017 female franchise ownership jumped by 83% and is still growing. (Entrepreneur)

General Franchise Statistics

          Another route by which one can become an entrepreneur is by purchasing a franchise. For those of you wondering what a franchise is, a franchise is nothing but a legal agreement that gives an individual the right to market a company’s products or services in a particular area. From motels to pet stores to video outlets, franchising opportunities are available in virtually every field. Let us first look into some of the general franchise statistics in this section.

• Every year, an average of about 300 companies start franchising. (Frankart Global)
• Limited-service restaurants, gas stations, full-service restaurants, hotels/hospitality, and new car dealers are the types of franchises with the most business units. (U.S. Census Bureau)
• With 68,236 stores across the globe, 7-Eleven was the largest franchisor in the world as of March 2019. (Statista)
• The most franchised food and beverage brand is Subway with 44,758 outlets followed by McDonald’s with36,525 outlets. (CNBC)
• Every 1 in 7  business is a franchise. (Frankart Global)
• McDonald’s has its franchises in 117 countries while Subway has its franchises in 112 countries. (Knoema)
• Multi-unit franchisees own 53% of all franchises. (Frankart Global)
• The 1^st franchise represented on 7 continents is Anytime Fitness. (Franchise Direct)
• A new franchise opens every 8 minutes, during the course of a single business day. (Reference for Business)
• Café Coffee Day is the only Indian brand in the Global Top 101 Franchise List with close to 1800 outlets and stands at 46^th rank. (Frankart Global)

Economic Impact of Franchises

          Compared to the durable goods manufacturing sector or the financial activities sector of the economy, franchising provides more jobs. Franchising has become a major source of jobs, helping in reducing the unemployment rate and is also a critical engine of economic growth. The national GDP is supported by franchises. We shall now look into some statistics that emphasize the economic impact of franchises.

• About 3% of the national GDP is accounted for by franchise accounts. (IFA)
• Providing a cumulative economic output of $757.2 billion, the total number of franchise establishments is 7,59,240. (Frankart Global)
• Compared to the independent business success rate, the 2 years franchise success rate is about 8% higher. (Francine Lafontaine)
• India is the 2^nd largest global franchise market in the world with around 1.5 lakh franchisees and 4600 franchises. (The Economic Times)
• The Indian franchise industry is expected to grow by about $140-$150 billion in the next 5 years. (Frankart Global)
• Marriott International retained its place at the top of the hotel industry by opening 516 properties throughout 2019. (Franchise Direct)
• More than 80% of all franchises are local or regional brands, while 16% of them are national or global franchises. (Frankart Global)
• In 2007, franchise businesses accounted for 10.5% of all businesses. (Fast Casual)
• During the past 3 years, among the top 200 restaurant franchises, an additional 39% of them have gone global. (FRAN data)
• 51.5% of food franchises earn less than $50,000 per year in net profits. (Franchise Business Review)

Franchises in the U.S.

          In the United States and in the local communities that they operate in, the creation of franchised businesses has had a lasting positive impact. The multifaceted franchise industry provides many benefits to the U.S. Billions of dollars in products and services are generated by franchising businesses apart from the payroll and the creation of American jobs. Now, let us look into some statistics on the leading franchises in the U.S.

• More than 300 different industries comprise the U.S. franchise sector. (U.S. Census Bureau)
• In the United States alone, there are more than 750,000 active franchised outlets. (Goldstein Law Firm)
• In the U.S., the Philadelphia Phillies are the oldest one-city, one-name sports franchises. (Wikipedia)
• The USA serves as the headquarters for 18 of the top 20 franchises worldwide. (Wikipedia)
• A total of about 3000 different franchises are currently operating in the U.S. (Frankart Global)
• The franchise industry accounts for about 50% of all the retail sales in the U.S. (Frankart Global)

Franchise Investment

          A franchise is a good choice for a person who wants to own a business and has all the resources needed for it but doesn’t know how to build it from scratch. By investing lesser money than required for starting a business, buying a franchise gives the opportunity of becoming an entrepreneur. Compared to independent businesses, franchise businesses are much easier to finance. Let us now look into a few statistics on franchise investment.

• An initial investment of about $250,000 is required for more than 50% of all franchises to open. (Frankart Global)
• In 2017, 152 public-to-private deals were signed. (Financial Times)
• The average length of a franchise contract is 10 years. (Frankart Global)
• An average of 3%-6% of gross monthly sales is the royalty fee paid by franchisees. (Frankart Global)

Franchise Employment

          An important source of employment and economic output is franchising. Franchise concepts, especially the service sectors are benefitted from low unemployment and increasing wages that drive up consumer spending. Franchisees have to compete for an increasingly limited labor pool because of the tight labor market. We shall now look into some statistics that throw light on franchise employment.

• In the U.S., franchises employ more than 8 million people.
• Although most franchise owners are men, between 2011 and 2017 female franchise ownership jumped by 83% and is still growing. (Entrepreneur)
• 9.6% of larger employers are franchises and 5.3% of small businesses are franchises. (SBE Council)
• Around 44% of franchise owners hold a bachelor’s degree. (WSJ)
• Veterans account for 14% of all franchisees. Veterans owned 66,000 franchises in 2017. (Entrepreneur)
• In the U.S., 50% of franchise workers are employed by quick-service restaurants.
• Across America, a total of about 1,644,100 people are employed in franchise businesses. (Statista)

Conclusion

          Well, we have now come to an end of this article and these were some of the interesting franchise statistics that you can crunch upon. Limited financial capital and the need to overcome great distances have resulted in franchised businesses. Like any other business, franchisees also need to adapt to overcome hurdles along the way, more often than not influencing their competitors to do the same. Indeed, franchising has now become one of the perfect recipes for growth.