We just covered helping you identify “The Best Franchise Brand for…YOU” so why do we have another chapter on the topic? While the resources we outlined will help align a franchise to your needs, you’ll also want to know what others think of that franchise. If your ideal franchise is #999 on a list of the 1,000 most successful franchises, you might want to consider expanding your search. This chapter is for just that – we want you to know some of the best brands for overall success, lowest costs, veterans and more.
Determining the Best Franchise Brands For…
As we covered last chapter, there are a lot of resources you can use to help narrow down which franchise brands are worth looking into for your particular goals, requirements and situation. Here is yet another resource: lists. Websites like Entrepreneur.com specialize in educating entrepreneurs on business topics, including a variety of franchise brands.
For this chapter, we’re going to rely on Entrepreneur’s 2017 Franchise 500 Ranking. Entrepreneur uses several factors to determine the annual list of top franchises: costs and fees (including total investment and royalties); size and growth (growth rate, closure rate, number of operating units); support (training, marketing and operational); brand strength (system size, social media presence, number of years in business); and the financial strength and stability of each brand, as measured by the franchisor’s audited financial statements.
All that said, Entrepreneur makes a very valid point: this list should not exclusively determine which franchise you choose to move forward with. As always, be sure to do your own research, as each individual situation is different.
The Best Franchise Brands:
|#1||7-Eleven||$38k – $1.1M|
|#2||McDonald’s||$1M – $2.2M|
|#3||Dunkin’ Donuts||$229K – $1.7M|
|#4||The UPS Store||$178K – $403K|
|#5||Jimmy John’s Gourmet Sandwiches||$330K – $558K|
|#6||Dairy Queen||$1.1M – $1.9M|
|#7||Ace Hardware||$273K – $1.6M|
|#8||Wingstop Restaurants||$347K – $733K|
|#9||Sport Clips||$189 – $355K|
|#10||RE/MAX LLC||$38K – $225K|
While these are the top franchise brands in the world, we do want to take a moment to let you know that most of the clients we work with that are new to the franchise world typically land on a franchise in the $300K-$600K range. That’s not to say you can’t jump right into owning a McDonald’s or Dairy Queen, it’s just those franchises are usually owned by someone who has been working in those industries for quite some time.
The Best Low-Cost Franchises
We’ll once again rely on Entrepreneur’s Franchise 500 list, but this time we’ll only look at brands with an initial investment range that begins lower than $100k. In the world of franchising, that’s pretty low.
|#1||RE/MAC LLC||$38K – $224K|
|#2||Kumon Math & Reading Centers||$70K – $141K|
|#3||Mosquito Joe||$67K – $123K|
|#4||Merry Maids||$87K – $124K|
|#5||The Maids||$76K – $164K|
|#6||Jan-Pro Franchising International||$4K – $51K|
|#7||Matco Tools||$91K – $270K|
|#8||Right at Home||$78K – 138K|
|#9||HomeVestors of America||$44K – $347K|
|#10||Baskin-Robbins||$94K – $402K|
Now, it’s important to know what all is included in the “initial investment” – and what isn’t. The franchisor is required to lay out each of these items in your Franchise Disclosure Document (a key document that we’ll dive into in Chapter 6), so you’ll know exactly what you’re in for. Here are the common initial investment costs laid out in a typical FDD:
- Franchise fee – your one-time fee to the franchise in return for using their brand, business model, etc.
- Training – any cost you will incur while you learn all about your new franchise, including travel expenses and the cost of the training itself
- Leasehold Improvements – costs associated with any necessary improvements to the physical location of your franchise
- Real estate – the cost of procuring your physical location. Not all FDDs include this, as real estate prices are constantly fluctuating and not all franchises require a physical location
- Equipment – If your franchise is one that requires equipment (a gym, for example), this section will lay out the costs
- Professional fees – the costs of professional services, which may include a CPA, lawyer and actually creating your business entity.
- Marketing – any costs that cover the marketing of your new location
- Additional funds – the working capital you will need for the time period between opening your doors and making a profit. Typically, the FDD specifies a 3-month timeframe.
The Best Franchises for Veterans
It’s common knowledge within the franchise industry that veterans tend to make excellent franchisees: they have excellent leadership and teamwork training and the ability to follow a pre-determined set of rules. In an effort to aid our country’s retired military members, and lure these excellent business owners to their brands, many franchisors offer veteran discounts.
Once again, we turn to that behemoth of business knowledge, Entrepreneur, for our list. They’ve created a list of 100 of the best franchises for veterans based on the discounts and services offered to the veterans in question, and ranked by the Franchise 500 list. 100 is a lot, so we’ll cover the top 10 and you can check out the other 90 here.
|Rank||Franchise||Initial Investment||Veteran Benefit|
|#1||Anytime Fitness||$89K – $678K||20% off the franchise fee|
|#2||Subway||$147K – $321K||Waives franchise fee if the franchise is located on a military or government property; 50% off if not on civilian property, and if the veteran is receiving government financing|
|#3||Super Cuts||$144K – $297K||$2,500 rebate on the franchise fee of the first location|
|#4||7-Eleven||$38K – $1.1M||10 – 20% off the franchise fee and special financing options|
|#5||Dunkin’ Donuts||$229K – $1.7M||20% off franchise fee for the first five locations|
|#6||Jan-Pro Franchising International||$4K – $51K||Up to 20% off franchise fee|
|#7||Hardee’s||$1.4M – $1.9M||10% off franchise fee|
|#8||The UPS Store||$178K – $403K||$10K off the franchise fee and 50% off the application fee|
|#9||Cruise Planners||$2.K – $23K||$1K off of franchise fee and $500 marketing credit, free training for a second individual and three months of webhosting|
|#10||GNC Franchising||$191K – $321K||50% off franchise fee for the first location|
The Best Franchises for Women
We had planned a section with a list of Top Franchises for Women, based on the same characteristics as the franchises for veterans – namely, franchise brands that are looking to specifically incentivize female entrepreneurs to buy into their brand.
Unfortunately, what we’ve found instead are lists of franchises that are “interesting for women” – namely home care and fashion boutiques. Don’t get me wrong – your humble author is, in fact, female, and does, in fact, think those are two solid franchising options. But I also happen to think that basing a list of “Top 8 Franchises for Women” on industries that the author thinks are only interesting to women is misleading and a waste of time.
The best we could find was a campaign 7-Eleven ran to encourage more woman franchise owners were only one lucky winner would get their franchise fee.
So, apologies to our female readers — we’re coming up empty on this one. If you happen to find a franchise that is incentivizing female entrepreneurs to invest in their brands, let us know! We’d love to hear about it.