Do you want to own a business but don’t technically want to start from scratch?
Then, you’ll want to look into franchising.
When it comes to business, that’s about as close as you can get to a plug-and-play situation.
With a franchise, you can use a company’s trademark, trade name, business model, intellectual property, and exclusive expertise.
But, of course, you’ll have to pay an initial fee and recurring licensing fees to be granted these rights.
In this post, we will explore the best franchises and why you might want to buy one.
Let’s get started.
What’s a Franchise?
Ok, real quick.
The term “franchise” refers to a business model where an entrepreneur is granted the legal right to use an established corporation’s trademarked name, logo, and products.
You’re buying their successful system and name brand.
In exchange, you pay them a royalty on the business you do.
According to the US Census, franchises account for 11.4% of all businesses in the country.
The Best Franchises To Own Right Now
Things are looking up this year now that the red-flagged industries (airlines, hotels, food service, entertainment, etc.) are back in business.
The ideal franchise to own is subjective, so we’ll use the following criteria to examine your best options:
Your franchise options will be limited by the amount of money you can invest.
If you’re on a tighter budget or trying to avoid too much debt, finding a good franchise at a reasonable price is a top priority.
The last thing you want to do is open a franchise in an obsolete market.
If you want to set yourself up for success, find a franchise in a rapidly expanding market.
Now that you know how I came up with this list, let’s figure out the most profitable franchise you can get.
Bookmark this insightful guide on Franchisee vs. Franchisor Roles for a deeper dive.
The UPS Store
The UPS Store provides various services and is involved in several markets.
But it sees the most growth potential in the courier and delivery sector.
Did you know that eCommerce is predicted to rise by 15% this year?
Well, someone has to handle the logistics.
The role of courier services like UPS in this process will be HUGE.
They’re the ones who will carry out shipping and handling returns.
The UPS Store is the most valuable logistics brand, with an estimated worth of over $22 billion!
In addition to having access to top-notch training and a carefully curated selection of products and services, franchisees can expand their business to additional locations.
52% of franchise owners have more than one store. That’s a good sign.
This one’s a bit on the nose.
I don’t know about you, but I see those famous golden arches when I think of a franchise.
McDonald’s has been a franchise industry leader since its inception in the 1950s.
This franchising opportunity is ideal for those seeking to capitalize on one of the economy’s fastest-growing sectors.
Yes, Mickey D’s still has it.
The company’s annual revenue and the number of locations available to franchisees are vital signs that this is the most lucrative franchise opportunity.
Everyone knows what McDonald’s is.
It has the kind of credibility that could open doors to new sources of capital and commercial opportunities.
Your return on investment will be superior to that of some random startup.
Dunkin’, formerly known as Dunkin’ Donuts, is a more affordable option than McDonald’s and has a solid reputation to back it up.
Dunkin’ establishments’ mainstays are coffee, donuts, bagels, and breakfast sandwiches.
To some, Dunkin’ is synonymous with breakfast.
Surprisingly, they see a steady stream of customers at all hours of the day.
According to their terms and conditions, most branches are open around the clock.
Their tagline, “America Runs on Dunkin,” is well-deserved.
Successful Dunkin’ franchises are typically community-minded and have experience in the food service industry.
They don’t mind catering to customers in the wee hours of the morning.
If you can relate, you can own a Dunkin’ franchise without breaking the bank.
Now that the pandemic restrictions have lifted, people are flooding the gyms again.
When it opened its doors in 2002, Anytime Gyms quickly became the fastest-growing gym franchise in the country.
It caters to various gym-goers by offering options, including group training, CrossFit, weightlifting, etc.
In addition to gaining thousands of new customers annually, the company is expected to see a doubling of its current customer base over the next few years.
It’s one of the world’s most successful health and fitness franchise models, with over 4,000 branches and a growing number of franchisees every year.
One of Anytime’s greatest strengths is that it is always open.
Fitness enthusiasts can focus on their physiques without sacrificing time with their other commitments.
Education is always going to be necessary.
As more and more parents recognize the importance of starting a child’s education off the right foot, the early childhood education industry has emerged as a promising franchise opportunity.
They’re also officially accredited as a top-notch educational childcare center.
Plus, they provide employment opportunities and continuing education access to their educators.
Kumon Learning Center
Let’s keep the ball rolling now that we’re talking about education.
Franchising ownership of a Kumon Learning Center can be a rewarding business venture for community-minded people focusing on families.
The Kumon aims to equip children with the foundational arithmetic and reading abilities necessary to master the advanced material covered in today’s courses.
In addition to providing after-school care and assistance with homework, Kumon also offers academic enrichment programs.
Due to their high demand and low barrier to entry, franchises like this make for a significant financial investment.
This one is a safe bet.
The WTTC predicts that by the end of 2023, the tourism industry will have recovered to pre-pandemic levels.
In other words, this is fantastic news for vacation arrangement services like Cruise Planners.
This well-known travel service has been around since 1994, and it initially specialized in helping people arrange cruises.
A Cruise Planners franchise owner in the travel industry is equivalent to an American Express Travel Representative who owns a full-service travel business.
In addition to being one of the more affordable franchises, Cruise Planners is widely praised for its excellent training programs, cutting-edge business tools, and regular executive off-sites.
The pandemic taught us how important it is to try to perfect our homes.
We’re the most productive when we’re in an ideal space.
That’s why DIY and construction saw a big boom in the past few years, and it’s not waning.
Compared to the usual experience at a big-box home improvement store, Ace Hardware offers a promising franchise opportunity.
I’m sure you’ve shown up at one of the stores I’m talking about and got inundated with unhelpful staff and too many product selections.
In contrast, Ace stores take pleasure in employing folks who make customer service a top priority.
They also curate the products that they sell.
Most importantly, their franchises let small hardware stores compete with national chains by offering a cooperative business model.
This strategy includes their store-brand merchandise and overall stellar reputation.
Speaking of Ace’s competition, let’s spotlight Snap-On Tools.
Snap-On is one of the few tool manufacturers with an unrivaled reputation for excellence.
It even has a cult following among gearheads, DIY enthusiasts, mechanics, and professional contractors.
Snap-On has a lot of loyal customers, so if you can find a good market for their products where you live, opening a franchise could be a good idea.
Snap-On intrigues potential franchisees since it does not require a significant initial investment or high net worth to join the franchise system.
National Property Inspections
As a result of the pandemic, mortgage rates dropped, and inventories dried up, creating a market for buyers like never before.
Although analysts anticipate a return to normalcy in the real estate market, many anticipate continued strength for sellers over the next several years.
Companies like National Property Inspections that aid in home-buying and selling are thrilled by this development.
It’s a time of recovery, and you should ride the wave!
NPI has thoroughly inspected residential and commercial properties since its founding in 1987.
Franchisees can tap into a well-established brand with a 35-year track record of success.
They can gain access to cutting-edge training resources and a personal marketing coach.
It’s also one of the cheaper franchise opportunities, with a total investment of $45,000 or less.
Veterans, active-duty personnel, and first responders can all receive a 20% discount!
Pillars to Post
Let’s continue this train of thought now that we’re on the subject of property inspection services.
The experts at Pillars to Post Home Inspectors do comprehensive assessments of homes, including electrical outlets, plumbing fixtures, and other potential hazards.
They also do water testing, checking for leaks and pests, and estimating costs.
Their operations span nearly three decades, making them one of the oldest companies in the industry.
Its initial franchise fees are steep, and some question whether this is fair.
Well, if you’re going to buy the right to use the name and brand of a company with a stellar reputation, it’s worth it.
Card My Yard
Card My Yard is the ideal franchise opportunity for those with a tighter budget who want to do something a little off the beaten path.
In 1994, two families came up with the concept of incorporating greeting cards and yard signs for special occasions.
Some 30 years later, they’ve established themselves at the industry standard, with over 450 franchisees across the US.
Owning a CMY franchise may be the perfect fit if you love spreading joy to others.
The best part is that you can buy one for under $10,000.
Franchisees also get access to a fully functional e-commerce platform, regular training sessions, and promotional materials.
If you’ve never heard of Taco Bell, you’ve lived under a rock.
There are over 7,000 TB branches in 30 counties, making it one of the world’s most ubiquitous providers of Mexican-style fast food.
For this reason, establishing a Taco Bell in a busy neighborhood would be a smart business move.
If your franchise application is accepted, you’ll spend several weeks in the company’s training program.
You’ll be taught the ins and outs of running your new business.
If you’re looking for a smooth entry into franchising, Taco Bell is an excellent option because they try to make it as smooth as possible.
Established in 1991, Jan-Pro has become a market leader in commercial cleaning services.
Many industry experts believe that due to COVID-19, the commercial cleaning market will continue to expand steadily through 2023 and beyond.
You just can’t be too careful these days.
That’s why businesses like movie theaters and arenas increasingly use commercial cleaners to regain patron trust.
The same goes for office spaces.
Employers want to make sure that their workers are in a safe environment.
Because commercial cleaning is becoming the standard, investing in a Jan-Pro franchise will fetch you neat profits.
Pause and bookmark this transformative read: ‘Top Assets for Generating Income.‘ It’s worth it!
Points To Consider Before Buying a Franchise
Buying a franchise will take some preparation.
It’s not only about buying on and expecting a business to run like a well-oiled machine immediately.
It’s still quite the undertaking.
So, for your unique circumstances, it’s best to address the following questions:
Why do you want to start a franchise?
Being interested in a brand isn’t enough. You have to think of the logistics.
Can you work at the site full-time?
Do you intend to open more than one branch?
Will you run your business remotely?
You must consider whether owning a franchise is realistic and evaluate your motivations.
How much risk are you willing to take on?
Each franchisor has its initial franchise fee.
For example, opening a Taco Bell will cost you over $500,000, while Card My Yard will cost you less than $10,000.
And more often than not, your net worth will be considered during the application phase.
Identifying a franchise that meets your financial risk tolerance is key.
What does the market look like?
The ideal franchise to buy is the one that has the highest likelihood of succeeding in the market where you plan to set up shop.
For example, a Kumon Center franchise could fit a city with underdeveloped schooling options.
An Ace Hardware franchise would make sense for a place with plenty of new construction.
Critical considerations for franchise investments:
- Your market’s demographics
- The nature of the competition
- The state of the industry as a whole
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Criteria to Figure Out If a Franchise Is Right for You
No franchise is foolproof.
Assessing a franchise means weighing your finances and the franchisor’s resources.
Explore the factors I’ve outlined below for your consideration.
Whether or not an investment opportunity is worthwhile is essential when making this huge business decision.
Even though it’s not an exact science, you can get a good idea of a franchise’s profitability by looking at its unit growth.
It would be best to look at their new franchisee success rate.
Do you have an existing business to learn from or look up to?
And most importantly, always study the franchisor’s financial statements.
When choosing a franchise, it’s essential to consider the measures the parent company has taken to ensure the new branch will be productive.
Some companies, like 7-Eleven, fly their franchisees to their training facility.
They also host events and seminars at their resource center.
Be aware that not all franchises, especially smaller ones, will have the same level of support as 7-Eleven.
However, they should still provide at least some form of training.
You have to commit to a franchise for at least a few decades, preferably much longer.
You can’t just start a business and close it down after a year!
You’ll have to be hands-on in the beginning.
Eventually, you can take on other time-intensive goals like launching a new career or entering another venture.
If you think you might want to quit within the first ten years, picking a franchise brand with more liquid units is essential.
Almost every franchisor has some regional expansion plan.
Companies have to plan this with care because mistakes can be costly.
If a new store were to be opened just miles away from an existing one or in an area with minimal demand, the business would likely lose money.
Find out whether the franchise you’re interested in has any plans to expand into your area.
In that case, you must decide if you’re up for that challenge.
How famous is the brand you plan to franchise?
Has the brand expanded significantly in the past year, especially if it’s a smaller one?
Will it keep expanding in years to come?
Whether or not it makes financial sense to run a franchise for a particular brand depends on these three factors.
Going with a large, well-known brand isn’t always the best option because of the substantial initial investment required.
It might be less of a leap to start with a smaller franchiser, provided it has been seeing steady revenue growth.
You might also want to consult a market analyst to check the company’s trajectory.
The Benefits of Owning a Franchise
Young entrepreneurs are generally drawn to franchise opportunities across industries thanks to the longevity of the franchising business model.
It’s also much easier to manage these days with the rise of remote work solutions.
Let’s consider the benefits of putting your money into one of 2023’s most promising franchises.
Focus on Entrepreneurship
There are more people than ever considering starting their own business.
Millennials often view franchising as an avenue to make a lasting impact, leveraging established brand recognition and customer base for their ventures.
These firms offer innovative solutions to assist franchisors in adapting to evolving customer needs and preferences.
Franchising Is Here to Stay
There has been franchising in some form since at least the 1850s.
The model has weathered several economic downturns, changed with the times, and continues to thrive.
Industry experts say franchises will rise due to low unemployment and lending rates.
Mostly, people managed to keep working and communicating using various online platforms, even with the pandemic.
Many franchises today operate their businesses digitally.
Even long-running franchises are trying to stay current by incorporating new technologies.
So, in theory, managing a franchise well is much more attainable these days.
Help From a Parent Company
Starting from scratch might not be a good idea in today’s dynamic market anymore.
Rather than building everything from the ground up, a franchisee can use an already successful model.
You also already inherit a loyal customer base.
Franchisors usually make it a point to assist in various ways.
This should save their franchisees time and money as they keep up with shifting customer demands.
For example, your franchisor can help you develop new products, market, and train staff.
Before wrapping up, here are more articles to dive into!
If you want to establish a business, buying a franchise is one way.
Please remember that these franchise forecasts are just estimates based on corporate data.
Each option has its own set of potential outcomes and associated costs.
But, purchasing a franchise can be a stepping stone to becoming a successful entrepreneur.
Take a chance on one of these profitable franchises and get to work!