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Franchising Facts and Stats

Quick Franchise Facts, Franchising Industry Statistics:

There are an estimated 1,500 different franchisors (franchise business companies) operating in the U.S.
There are believed to be more than 750,000 franchise businesses in the U.S.
The franchising industry and businesses employs over 18 million people in the U.S.
In 2004, it is estimated that franchise businesses were responsible for over 1.5 trillion in economic output
The franchise industry accounts for 40% of all retail sales in the US
A new franchise business opens every 8 minutes of every business day
Approximately one out of every 12 businesses in the U.S. is a franchise business
Franchise fact: More than 75 different industries use franchising as a means to distribute goods and services
The average initial franchise investment is $250,000- excluding real estate
The average royalty fees paid by franchisees range from 3% to 6% of monthly gross sales
Most franchise companies have fewer than 100 units
The average length of a franchise contract is 10 years
Top franchise industry- Fast Food
Top franchise company- McDonalds

U.S. Department of Commerce Seven Year study of Franchise vs. Independent Start-Up Success Rate:

According to the U.S. Department of Commerce, franchise businesses are exponentially more likely to succeed than individual new start-ups, particularly if you look at the figures over a five or seven year period. According to Department of Commerce figures, after seven years 91% of new franchises are still in business, as compared to only 20% of individual new start-up businesses.