We used our data to track the growth of new franchises over a ten-year period and present the challenges and opportunities that many franchise brands face. We researched how franchise brands progress from emerging startups to established brands.
The emerging franchises are the largest segment of the franchise industry, with 71% of franchise systems in the US having less than 100 franchised outlets. Although the dominant franchise systems continue to receive the majority of the investments into the industry, many smaller brands possess the potential to grow into large franchise systems.
It is crucial for the franchise industry to overcome the starts and stops of franchise growth to allow them to grow beyond a smaller number of locations.
Our research reveals that after attrition, 20% of franchises that started 6 to 10 years ago and continued franchising had 100 locations or more.
When it comes to growing new franchise locations, the franchisors goal is to add as many new franchisees as their system and market can sustain.