The Latest Franchise Industry Statistics Explained
The franchise industry is projected to contribute nearly $500 billion to the U.S. Gross Domestic Product in 2021.
The statistic highlights the significant economic impact of the franchise industry on the United States, with a projected contribution of almost $500 billion to the Gross Domestic Product (GDP) in 2021. This indicates the substantial role that franchise businesses play in driving economic growth and creating employment opportunities across various sectors. The industry comprises a wide range of businesses operating under a common brand and business model, spreading across industries such as food and beverage, retail, and services. The projected contribution underscores the industry’s resilience and ability to adapt to changing market conditions, contributing to the overall strength of the U.S. economy.
There are over 770,000 independent franchise businesses operating in the U.S.
The statistic that there are over 770,000 independent franchise businesses operating in the U.S. highlights the significant contribution of the franchise industry to the country’s economy. These businesses, which operate under established brand names but are independently owned and operated, play a crucial role in driving job creation, entrepreneurship, and innovation across various sectors. The large number of franchise businesses indicates the popularity of the franchise model among aspiring entrepreneurs and investors looking to leverage the benefits of operating a proven business concept with ongoing support from the franchisor. This statistic underscores the diversification and resilience of the U.S. business landscape, with franchises representing a sizable portion of the overall business ecosystem.
Franchise businesses provide over 8 million jobs in the United States.
The statistic “Franchise businesses provide over 8 million jobs in the United States” signifies the significant contribution of franchise establishments to the country’s labor market. Franchising is a business model where a franchisor licenses the rights to its business model, brand, and operations to a franchisee. The statistic highlights the large number of employment opportunities created by franchise businesses across various industries, showcasing their essential role in job creation and economic growth. This data underlines the importance of franchising in generating employment opportunities, supporting local economies, and fostering entrepreneurship in the United States.
Around 60% of franchise businesses operate in the service sector.
The statistic “Around 60% of franchise businesses operate in the service sector” indicates that the majority of franchise businesses, approximately 60%, are primarily focused on providing services rather than selling products. This information suggests a strong presence of service-oriented franchise opportunities within the market. Franchise businesses in the service sector could include industries such as food and beverage, healthcare, education, consulting, and more. Understanding this distribution can be valuable for individuals looking to invest in a franchise or for policymakers assessing the impact of franchises on the economy, highlighting the significant role that service-oriented franchises play in the overall landscape of franchise businesses.
As of 2020, men are 71.9% more likely to own multiple units than women in the U.S.
The statistic indicates that in 2020, men in the United States were 71.9% more likely to own multiple units compared to women. This means that for every woman who owns multiple units, there are about 1.7 men who own multiple units. The disparity in ownership of multiple units between men and women suggests a significant gender gap in property ownership. Possible factors contributing to this discrepancy may include differences in income, access to financing, cultural norms, and historical patterns of property ownership. It highlights an important gender disparity in the real estate sector and may warrant further investigation and efforts to address gender inequalities in property ownership opportunities.
41% of all food service businesses in the United States are franchised.
This statistic indicates that 41% of all food service businesses in the United States operate as franchises, meaning they are independently owned businesses that pay fees to a parent company in exchange for the right to use its branding, products, and business model. Franchising allows individuals to own and operate their own businesses under a known brand name with established procedures and support from the franchisor. This statistic suggests that franchising is a popular business model within the food service industry, providing opportunities for both franchisors to expand their brand and for franchisees to benefit from established business practices and brand recognition.
An estimated 26% of all franchises globally are located in the United States.
The statistic “An estimated 26% of all franchises globally are located in the United States” suggests that the United States plays a significant role in the global franchise industry. This figure indicates that nearly one-fourth of all franchises worldwide are based in the U.S., highlighting the country’s strong presence and influence in the franchising sector. The high concentration of franchises in the United States may be attributed to factors such as a well-established business environment, a culture that encourages entrepreneurship, and a diverse market that supports a wide range of franchise opportunities. This statistic underscores the importance of the United States as a key player in the global franchise landscape.
As per the International Franchise Association, every $1 spent in the franchise industry results in $2.19 worth of economic output.
The statistic provided by the International Franchise Association suggests that for every $1 spent in the franchise industry, there is a return of $2.19 in terms of economic output. This indicates a multiplier effect, where the initial investment in franchises leads to greater economic activity and generates value beyond the original expenditure. The figure highlights the significant impact of the franchise industry on driving economic growth and creating opportunities for employment and business development. It underscores the importance of franchising as a driver of economic activity and as a key contributor to overall economic prosperity.
The QSR (Quick Service Restaurants) industry represents the largest category within franchising, with a market size of $256 billion.
The statistic that the Quick Service Restaurants (QSR) industry represents the largest category within franchising, with a market size of $256 billion, indicates the significant economic impact and scale of this sector within the franchise industry. This data highlights the substantial financial transactions and business operations that are associated with QSR franchises. The $256 billion market size suggests the high demand for quick and convenient dining options, as well as the successful business models and brand recognition of QSR franchises. It also underscores the potential for growth and profitability within the QSR industry, making it an attractive sector for investors and entrepreneurs looking to enter the franchising market.
Multi-unit franchise operators own 53% of all franchised businesses in the United States.
This statistic indicates that a majority of franchised businesses in the United States are owned by multi-unit franchise operators, who control 53% of all franchised establishments. Multi-unit operators are individuals or entities that own and operate multiple franchised locations of a particular brand or concept. This suggests that these operators have a significant presence and influence within the franchising industry, showcasing their ability to successfully manage and scale their business operations across multiple units. Their prevalence underscores the trend in the industry where operators are increasingly expanding their portfolios and diversifying their investments to leverage economies of scale and optimize operational efficiencies.
The average initial franchise fee is $20,000 – $30,000.
The statistic that the average initial franchise fee ranges from $20,000 to $30,000 indicates that, on average, individuals looking to purchase a franchise can expect the initial franchise fee to fall within this price range. This information suggests that potential franchisees should be prepared to make an investment of this size as an upfront cost when entering into a franchise agreement. It is important to note that this average range provides a general idea of what to expect, as specific franchise fees can vary significantly depending on the industry, brand, and specific terms of the agreement.
Franchise establishments are expected to grow at an annual rate of 1.5% in 2021.
The statistic “Franchise establishments are expected to grow at an annual rate of 1.5% in 2021” indicates that the number of franchise businesses is projected to increase by 1.5% over the course of the year. This growth rate suggests a moderate but steady expansion in the franchise sector, reflecting confidence in the business model among entrepreneurs and investors. Factors contributing to this expected growth may include market demand for franchise services or products, a favorable economic environment, and the appeal of established brands and systems offered by franchises. The statistic serves as an indicator of the potential growth and viability of the franchise industry in the upcoming year.
Approximately 4% of all businesses in the U.S. are franchisee-run establishments.
The statistic indicating that approximately 4% of all businesses in the U.S. are franchisee-run establishments suggests that a small but significant portion of the American business landscape is comprised of franchises. Franchising is a popular business model where individuals (franchisees) purchase the rights to operate under a larger company’s brand and business system, while also benefiting from established support systems. This statistic highlights the substantial presence of franchise businesses in the U.S. economy, reflecting the appeal of this model for both franchisors and franchisees seeking a structured and potentially profitable business opportunity. Additionally, this statistic underscores the diverse range of business ownership structures present in the U.S., contributing to the overall economic vibrancy and entrepreneurship within the country.
More than half of all U.S. retail sales come through franchised businesses.
This statistic indicates that a significant portion of retail sales in the United States are generated through franchised businesses, where independent operators (franchisees) operate under the branding and business model of a larger company (franchisor). The involvement of franchised businesses in the retail sector demonstrates the popularity and success of this business model, as it allows individuals to benefit from established brand recognition, support systems, and proven operating procedures. The statistic underscores the significant contribution of franchised businesses to the overall retail landscape in the U.S., highlighting their role in driving sales, creating employment opportunities, and fostering economic growth in the retail industry.
France holds the second highest number of franchises globally, after the U.S.
The statistic “France holds the second highest number of franchises globally, after the U.S.” indicates that France has a significant presence in the franchise industry, ranking second in terms of the total number of franchise establishments compared to other countries worldwide, with the United States leading in this aspect. This suggests that the franchise business model is popular and thriving in France, contributing to the country’s economy and providing opportunities for entrepreneurship and business growth. The statistic reflects the widespread adoption and success of franchising in France, showcasing the country’s attractiveness for both franchisors and franchisees seeking to expand their businesses internationally.
Total of 795,932 franchise establishments were in the U.S. in 2020.
This statistic indicates that there were a total of 795,932 franchise establishments operating in the United States in 2020. Franchises are a popular business model where individuals or groups can purchase the rights to operate a business using an established brand and business model. The large number of franchise establishments highlights the significant presence of this business format in the U.S. economy, providing opportunities for entrepreneurs and contributing to overall economic activity. This statistic also indicates the diverse range of industries and sectors that utilize the franchise model, ranging from fast-food restaurants to retail stores to service-based businesses.
The Hospitality Industry accounts for 18% of all U.S. franchising, second only to the restaurant industry.
The statistic indicates that within the realm of franchising in the United States, the Hospitality Industry holds a significant market share of 18%, making it the second-largest sector after the restaurant industry. This suggests that a considerable portion of the franchise businesses in the U.S. operate within the hospitality sector encompassing hotels, resorts, and other accommodation services. The data highlights the industry’s substantial presence in the franchising landscape, underscoring its appeal to entrepreneurs seeking to invest in established brands and business models within the hospitality sector. The statistic emphasizes the industry’s economic importance and its role in providing opportunities for franchising businesses and investors in the U.S.
65% of franchises are owned by men, while 35% are owned by women.
The statistic “65% of franchises are owned by men, while 35% are owned by women” indicates the distribution of franchise ownership between men and women. This data suggests that there is a gender disparity in franchise ownership, with a majority of franchises being owned by men. The imbalance could be influenced by various factors such as historical gender roles, access to financial resources, and societal norms. Understanding these dynamics can be crucial in addressing gender disparities in entrepreneurship and promoting more equitable opportunities for women in the franchise industry.
The fastest-growing franchise in 2021 is Dunkin Donuts, showing a growth rate of 271%.
The statistic indicates that Dunkin Donuts experienced substantial expansion throughout 2021, with a remarkable growth rate of 271%. This suggests that the number of Dunkin Donuts locations increased significantly over the year, making it the fastest-growing franchise within the specified time frame. Such rapid growth can be attributed to various factors, including effective marketing strategies, consumer demand for their products, and successful business operations. This statistic highlights Dunkin Donuts’ strong position in the market and demonstrates their ability to capitalize on opportunities for growth within the franchise industry.
References
0. – https://www.www.franchisehelp.com
1. – https://www.www.retailresearch.org
2. – https://www.www.statista.com
3. – https://www.www.usatoday.com
4. – https://www.www.ibisworld.com
5. – https://www.www.franchisedirect.com
6. – https://www.www.entrepreneur.com
7. – https://www.www.franchise.org
