New Research Indicates Franchise Business Owners Are Satisfied and Confident About Growth
Portsmouth, NH – Franchise Business Review announced today that satisfaction among franchise business owners is at an all-time high. The Portsmouth, NH-based research firm has been tracking satisfaction among franchise owners (franchisees) since 2005.
The data released by Franchise Business Review shows that 88 percent (88%) of franchise owners surveyed indicate that they “Enjoy Operating their Business,” and 87 percent (87%) said they “Enjoy Being Part of their Franchise Organization.”
I Enjoy Operating My Business: 88% (Strongly Agree to Agree)
I Enjoy Being Part of My Franchise Organization: 87% (Strongly Agree to Agree)
I Respect My Franchisor: 85% (Strongly Agree to Agree)
My Overall Satisfaction with My Franchise: 83% (Excellent to Good)
When it comes to the future outlook for their business, two-thirds (67%) rated their long-term growth opportunity as “very strong” or “strong,” while another 25 percent (25%) rated their long-term growth outlook as “moderate.” Just eight percent (8%) rated their long-term growth opportunity as “weak” or “very weak.”
Franchise Business Review has surveyed franchisees from over 1,100 franchise companies in the past fifteen years, and not surprisingly, satisfaction among franchise owners was at is lowest point during the recession in 2009 – 2010. This current data is based on surveys of over 28,000 franchisees representing 310 franchise companies surveyed in the past 18 months (October 2017 – March 2019).
“The last few years have been very good for many franchise business owners,” said Eric Stites, CEO and Managing Director of Franchise Business Review. “Franchising – like most small business – follows the ebbs and flows of the overall economy. It’s great to see satisfaction among franchise owners so high, and their long-term business outlook so strong.”
Franchise Business Review’s research looked at 33 different key areas of franchise operations in order to measure overall satisfaction and engagement among franchisees. “Certainly, no franchise company is perfect,” said Stites. “The key drivers of satisfaction include training, marketing, technology, innovation, and franchisor – franchisee relations. Financial performance obviously plays a big role and when people are making money, it takes the pressure off other areas. Our data helps franchise companies better understand their strengths and challenges and improve overall franchise performance.”
According to Franchise Business Review, there are approximately 3,000 franchise companies operating in the U.S. today, but over two-thirds (69%) of those companies are smaller franchise companies with fewer than 100 locations. “The really big franchise companies with over 1,000 locations that people often think of when they think about franchising – like McDonald’s or Subway for example – represent less than ten percent of the franchise universe,” continued Stites.
Franchise business opportunities range in investment cost from as low as a few thousand dollars into the millions of dollars. Franchise Business Review data puts the median franchise investment at just north of $150,000. Franchisees are typically required to have at least 30 percent (30%) in cash with the remainder being financed with a small business loan or other sources of capital.
Average annual incomes for franchisees varies widely depending on concept, industry, and market area. Based on Franchise Business Review’s survey data, the average annual pre-tax income for all franchisees surveyed is $95,290, which is up over 15 percent (15%) since 2016. Multi-unit franchisees – those who own more than one franchise location – report average annual incomes of $135,806, approximately 43% higher on average. Of those surveyed, 62 percent (62%) owned a single location or territory, while 38 percent (38%) were multi-unit franchise owners. 45 percent (45%) had been in business for at least five years, while 24 percent (24%) had only been in business for less than two years.
About This Research
Franchise Business Review conducted independent surveys of 29,341 franchise owners (franchisees) between October 2017 – March 2019. These franchise owners represented one of 310 different franchise companies. Participants were asked 33 benchmark questions related to satisfaction and engagement, as well as a number of market area and demographic questions to determine a Franchise Satisfaction Index (FSI) score. FBR has tracked franchisee satisfaction since 2005, and current overall satisfaction among franchise owners is at an all-time high, up over 10% since a low in 2009. More information about our research is available at: https://tour.franchisebusinessreview.com/franchisee-satisfaction/
About Franchise Business Review
Franchise Business Review (FBR) is a leading market research firm serving the franchise sector. FBR measures satisfaction and engagement of franchisees and publishes various guides and reports for entrepreneurs considering an investment in a franchise business. Since 2005, FBR has surveyed hundreds of thousands of franchise owners and over 1,100 leading franchise companies. To read our publications, visit https://franchisebusinessreview.com/page/publications/. To learn more about FBR’s research, please visit www.FranchiseBusinessReview.com
Franchise Business Review