Prospective Franchisees and Franchisors Should see These Statistics
by Ed Teixeira
Whether you’re considering purchasing a new franchise or starting up a
franchise company these key industry statistics from the U.S. Census Bureau
provide insight into the role of franchising.
This year the U.S. Census Bureau in conjunction with the International
Franchise Association reported franchise industry statistics for the first time.
This data reveals by industry code the number of businesses in total and those
operated as franchise outlets in total and then by the franchisee and
Analyzing this data revealed some interesting results about the level of
franchising in particular industries. For someone considering purchasing a
franchise the level of franchise participation in a particular industry segment
can indicate a possible strength or weakness about franchising in that industry.
The following statistics include appropriate commentary:
Industries with a High percentage of Franchise Outlets
Quick Serve Restaurants 211,313
Franchise Operated 125,000
The percent of franchise operated QSR is far greater than with
full service restaurants, which is indicative of the required investment and
operational factors needed for a full service sit-down restaurant.
Mail and Copy Centers 5,220
Franchise Operated 3,546
The majority of mail, copy and shipping centers are franchise
operated. This is not surprising given the type of services provided and the
ability for commodity pricing.
Children Exam Preparation and Tutoring 7,192
Franchise Operated 2,361
Large franchisors dominate this industry segment. Huntington,
Kumon and Sylvan are the big players.
Tax Preparation Services 25,000
Franchise Operated 5,416
This franchise segment has remained vibrant and continues to
welcome new franchisors despite the dominance of HR Block and Liberty.
Real Estate Brokers 109,400
Franchise Operated 22,000
Spawned by Century 21 the franchised real estate industry has
continued to grow. Branding and economies of scale make this sector a natural
One segment with 100% franchise composition is the 24,888 New Car Dealers
Industries with a Low Percentage of Franchise Operations
Beauty Salons 81,632
Franchise Operated 6,500
For certain reasons this sector has never taken to franchising
as much as one would expect.
Senior Home Care 20,433
Franchise Operated 1,677
Although the percent of franchise outlets is not high this
sector has been experiencing significant growth. Look for this franchise segment
to continue to increase in size and market dominance.
Home Healthcare 23,000
Franchise Operated 565
Despite the growth in homecare services the regulatory
requirements for skilled services and hands-on care make the home healthcare
sector difficult to franchise. Control and oversight are strict requirements for
Pet Care 11,353
Franchise Operated 252
Although a number of new pet care franchise concepts have
arisen in recent years this sector has not made significant inroads in terms of
the entire industry.
What does this data tell us? Industries that have a high percentage or large
numbers of franchise outlets indicate that the products and services these
industries provide lend themselves to the franchise model. Industries with a low
number of outlets and a low percentage of total outlets are usually an
indication that the industry does not readily lend itself to franchising.
© 2010 FranchiseKnowHow, LLC
Ed Teixeira is the President of FranchiseKnowHow, LLC. He
can be reached at firstname.lastname@example.org