Franchise Statistics

Statistics are interesting things that can help justify almost whatever position you want to take. However, the statistics below represent some pretty powerful reasons to look seriously at the franchise opportunities. Even when growth is slow the success of franchises remains about the same – which is overall better than non-franchised business.

Franchise Alliance (whom the The Franchise Stop is a member of) is the source for the consolidation of the following statistics. Franchise Alliance supports one of the largets broker networks and has relationships with more franchises than any other broker network.

Industry Statistics

The International Franchise Association has reported that franchising is responsible for 760,000 businesses, 18 million jobs, 14 percent of the private sector employment, and over $500 billion in payroll!

Franchised businesses account for nearly 50% of all retail sales in the United States.

According to latest estimates, there are over 2,000 franchises available in 75 industry categories.

From January, 2000 to December, 2004 the index that tracks the performance of the top 50 franchisors increased 34.5% compared to a drop of 20.1% in the S&P 500 over the same period.

A 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 the were still open for business.

A U.S. Department of Commerce study showed that during that time less than 5% of franchise businesses were closed each year.

A U.S. Small Business Administration study found that 62% of non-franchised businesses closed within the first 6 years of their existence due to failure, bankruptcy, etc.

Total sales by franchised businesses are projected to reach over $2 trillion, this year.

1 out of every 12 businesses is a franchised business.

A new franchised business is opened every 8 minutes of every business day.

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.

According to a recent article by the National Federation of Independent Business (NFIB), 1 of 4 small businesses with employees have their primary location at home, and over 85% of small firms are operated by owner-managers.

Additional information can be found by reading the 2010 Franchise Business Economic Outlook