Franchising as an industry first came into its own during the 1930’s and 1940’s when several hotels and gas stations decided to begin offering new dealers a comprehensive system of operational and marketing strategies. Since that time, the franchising industry has become a national power in America’s economy and a blessing for risk-averse entrepreneurs. Why is franchising growing so rapidly? Because franchising works. Franchising allows aspiring business owners to pursue their dreams in an industry that they love while eliminating much of the risk and guesswork that usually accompanies a new business start-up. A franchise provides a proven system; a business model that has worked and is working, usually for tens and even hundreds of franchise owners. Today, franchising is a major force in almost every industry imaginable, accounting for a disproportionate share of retail sales throughout the U.S. Here are some more interesting statistics gathered from the website of the International Franchise Association.
- The franchising industry employs over 18 million people in the U.S.
- There are believed to be more than 750,000 franchise businesses in the U.S.
- It is estimated that franchise businesses were responsible for over 1.5 trillion dollars in economic output.
- A new franchise business opens every 8 minutes of every business day.
- According to statistics from the U.S. Department of Commerce, less than 5% of franchise outlets fail annually.
- The franchise industry accounts for 40 percent of all retail sales in the United States and one out of every 12 businesses is a franchise.
- While franchises only account for 8% of all service business, they claim over 40% of all service-related revenue.
- If current trends are any indicator, the growth of the franchise industry shows no signs of letting up: more than 300 different types of industries and businesses are franchising and a new franchise opens every eight minutes, accounting for 35 percent of all retail goods and services sold.
Franchisors also provide their franchisees with benefits someone would not be able to get starting a business on their own. The most obvious is a proven business model with an established product or service with built-in name recognition. Branding is important to a successful business and starting out with a name that people know and trust is a huge advantage. You will also receive the necessary start-up assistance and training to avoid mistakes that other new businesses would encounter, along with proven tools for success. You will also receive technical, operational and managerial assistance unavailable to independent businesses. A few of the biggest advantages to owning a franchise are the collective buying power offered, the marketing experience at your fingertips and the advertising clout available through a successful franchise system. Franchising has become the clear choice for entrepreneurs who acknowledge their need for guidance and who value a long-term plan for business success!
Rapid Recovery News