Overview of Franchising Industry:

Statistics:

• Franchised businesses account for nearly 45% of all retail sales in the United States.

• The International Franchising Association (IFA) lists over 75 industries that use franchising to distribute goods and services to consumers.

• The IFA 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.

• Total sales by franchised businesses are projected to reach over $2 trillion in 2006.

• 1 out of every 12 businesses is a franchised business.

What About You?

Everywhere you look today, you see FRANCHISES! In fact, financial experts have indicated that franchising is the “wave of the future”. In the next 10 years, franchising could 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. Franchising offers success, with the least amount of risk, to aspiring business owners. Franchises will enable hundreds of thousands of new business owners realize the dream of successful business ownership and financial independence.

What is stopping you? Are you like many other people and simply don’t know where to start? Are you asking yourself the following questions?

• I want to start a business, but I don’t know what kind?

• There are over 1500 franchises available, which is the right one for me?

• I don’t have any experience in running my own business; can I get the training?

• Can I get support after I get my business started?

• How much investment will I need?

• Can I finance any of my investment?

• Do I need to operate the business or can I hire someone to run it for me?

Reality Check:

Franchising opportunities provide brand recognition, management and administrative systems and a proven business model to small business owners. In theory, this should result in franchises having higher success rates than non-franchise business opportunities. But in practice, franchises can and do fail.

In a recent interview aired on CNN, Franchise.com President Nancy Ghanem gave her recommendations on franchise success and gauging realistic financial projections.

Ghanem believes franchises fail primarily because franchise owners do not adequately research franchise opportunities prior to purchase and they do not match personal attributes and interests to activities associated with the presented business opportunity.

(Franchise.com, retrieved 3/5/07,http://www.franchise.com/en/us/template/buyer,ResearchCenter.vm/display/838 )

Seasoned Business Professionals:

Today's older population is healthy and active-Worldhealth.net reported that 7.5 million Americans 55 and older belonged to gyms in 2002, compared with 1.5 million in 1987. These older Americans have both the desire and the ability to stay in the work force well past the age of 50. In a recent poll from The Wall Street Journal and NBC News, retirees were more interested in an active life, which involved working, than their parents' generation.

For aging individuals seeking new work options, franchising is an appealing choice. "Folks in their 50s are energetic," says David Handler, senior vice president of the International Center for Entrepreneurial Development, a Cypress, Texas-based holding company for nine franchise brands. "They've perhaps lived the corporate life, and they're ready to try it on their own."

(Entrepreneur.com, retrieved 3/6/06, http://www.entrepreneur.com/magazine/entrepreneur/2004/august/71812.html )

General Information / Articles:

Franchising 101

       Pitfalls of Franchising

Go here for a variety of articles on Business Plans, Funding, and other topics of interest to entrepreneurs.

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Last modified: 05/01/16