Franchising is a popular business model that empowers entrepreneurs to operate under established brands while enjoying proven systems of support. With its significant economic contribution and diverse opportunities across sectors, franchising offers an attractive route for individuals looking to own and grow successful businesses.

The Scale of the Franchise Industry

Franchising is a powerful economic force, contributing $827 billion annually to the global economy and employing over 8.5 million people. A new franchise opens every eight minutes during business hours, reflecting the industry’s rapid growth.

Diverse Sectors in Franchising

While food-related franchises dominate, accounting for 37% of the market, the industry spans 28 other sectors, including healthcare, retail, and urgent care services. The healthcare franchise industry alone is projected to generate $100 billion in revenue by 2024, showcasing the growing opportunities for businesses to expand into new markets.

Who Owns Franchises?

Franchise ownership is diverse, with 53% held by multi-unit owners who operate several locations under the same brand. The average age of a franchise owner is 44, and while 69% of owners are men, women account for a growing 31%. If you’re wondering, ‘How can I franchise my business?’, specialist franchise consultants like Ashtons Franchise can help.

Fast-Food Franchising Dominates

Quick-service restaurants like McDonald’s and Subway are synonymous with franchising, accounting for $276 billion in economic output annually. With over 20,000 Subway locations across the US and 93% of McDonald’s restaurants franchised, this segment demonstrates the scalability of a well-known brand.

The Financial Aspects of Franchising

Understanding financial commitments is crucial before investing in a franchise. Initial fees range from £10,000 to £100,000, depending on the brand and support offered. Ongoing royalty fees, typically 5-6% of gross sales, ensure continuous operational support and marketing. Indeed has a guide explaining what royalties are.

The Future of Franchising

Franchising is poised for continued growth, with emerging sectors like healthcare and urgent care services gaining traction. Innovations in technology and shifts in consumer preferences will shape new opportunities.

Franchising offers a diverse, scalable, and economically impactful business model, making it a compelling choice for aspiring entrepreneurs and businesses.