6 Great Examples of Businesses That Benefitted From Franchising
We all know — or should know by now — that franchising is much more than just fast food. The reality is that only 24% of all franchise concepts fall into the category that the industry refers to as “quick-service restaurants” or QSR. The rest can be found across dozens of industries as the total number of franchise concepts on the market today includes somewhere between 3,000 and 4,000 brands.
What motivated these companies in choosing to franchise their business models?
For most, it comes down to a simple equation. Brands can use franchising to expand much further, much faster, without the risk of additional debt or equity stake. In exchange for the use of the franchisor’s trademark, business model, operations, training, systems and support, are the party responsible for putting up the capital required to own a business of their own.
There are many additional reasons to franchise a business model, as you’ll see. Here are six great examples of businesses that greatly benefit from franchising.
Related: The 9 Advantages of Franchising
Pet Supplies Plus
Pet Supplies Plus was founded in 1987, but it only took it three more years to see the value in franchising its business model.
The brand is an industry leader in the B2C world of retail-based pet supplies. America’s love affair with their pets is well-documented, as most describe their four-legged friends as “members of the family.” It’s an industry that generates more than $100 billion in annual revenue — not surprising when you consider that 70% of U.S. households own at least one pet.
Pet Supplies Plus has expanded its corporate footprint through franchising — it’s currently at over 600 locations in the U.S. In the past three years alone, awarded franchise units have risen an astonishing 35.7%.
Pet Supplies Plus is a brand that’s doing franchising right, and it earned the brand the number 20 spot on Entrepreneur’s 2022 list.
Great Clips, founded in 1982, began franchising its business model one year later. It’s now grown to reach nearly 4,500 locations in the U.S. and Canada. The brand concentrated its effort on making its offering a recession-resistant business because no matter how tough times get, everyone still needs a regular haircut.
But Great Clips resisted the frills. The franchise opportunity is not a spa, nails, tanning or waxing studio, it simply cuts hair and does it well. Sales of new franchises are up 5% in the past three years. Not surprising when you consider the haircare industry generates $70 billion each year.
Great Clips ranked number 22 on Entrepreneur’s 2022 Franchise 500 list.
Related: The Franchisor’s 10 Commandments
HomeVestors of America
You probably recall seeing a fairly common billboard advertisement that reads, “We Buy Ugly Houses.” Yep, that’s HomeVestors of America, a brand that franchised its business model back in 1996 and now has more than 1,100 established locations in the U.S.
The brand’s initial franchise fee is quite reasonable, anywhere from $39,000 to $80,000, and franchise owners in return get a world of possibilities as residential real estate investors. Franchisees that have followed HomeVestors of America’s proven business model are responsible for buying more than 125,000 houses in the U.S., which they can then restore, fix up and sell at a profit.
New franchise sales are up 4.6% in the past three years, helping HomeVestors of America rank number 35 in Entrepreneur’s 2022 Franchise 500 list.
Of course, we’d have to include at least one fast-casual restaurant franchisor on the list, but Firehouse Subs is a brand that’s developed an admirable franchising program. Within a year of the company’s founding in 1994, the brand began franchising and hasn’t looked back since.
Among specialty sub sandwiches, Firehouse has excellent brand recognition, and the outfit gets high marks for both taste and consistency. It recently topped 1,200 locations nationwide with a 4% increase in new franchisees in the past three years.
One aspect of its franchising program worthy of recognition is its commitment to giving back to the communities. Since 2005, the Firehouse Subs Public Safety Foundation has raised more than $24 million to support the lifesaving capabilities of countless local civic organizations.
It’s an admirable franchising program that helped Firehouse earn the 58th overall spot on Entrepreneur’s 2022 Franchise 500 list.
Related: Franchising Provides Owners With a Proven Model and Opportunities to Evolve the System
The Dream Vacations brand has been franchising since 1992, making this year its 30th anniversary in the industry. It’s come a long way since then, having recently reached nearly 1,500 U.S. locations. Not bad for a simple concept — a consumer-facing travel agent consultancy.
We’ve heard a lot lately about the pent-up demand to travel in a post-pandemic world, and that’s evidenced in the 12% increase in new franchises awarded within the past three years. Dream Vacation franchise owners benefit from a second-to-none training and support program that offers franchisees a technology-based, turnkey solution to help consumers plan their own “dream vacations.”
Its business model relies on home-based operations with a considerably low initial franchise fee. It features like this that helped the brand secure the 82nd overall spot on Entrepreneur’s 2022 Franchise 500 list.
PuroClean is another example of a brand that began franchising within the first year of its founding, way back in 1990. Since that time, it’s grown its empire to include more than 320 franchise locations in the U.S., spurred on by an increase of 24.7% in just the past three years.
PuroClean is another perfect example of a recession-resistant business model, as the brand’s primary duty is the mitigation of water damage and mold removal — catastrophes that can strike the residential and commercial market at any time.
The brand has greatly expanded the appeal of its business model for new franchisees by aligning itself with negotiated programs with several major insurance carriers across the country. It’s forward-thinking leadership like this that earned PuroClean the 97th overall spot on Entrepreneur’s 2022 Franchise 500 list.
Related: How to Use the Power of Purpose to Market Your Franchise