The success rate for new franchises can vary depending on several factors such as the industry, the franchise model, the franchisee’s experience and skills, and the location of the franchise.
However, according to the International Franchise Association’s Franchise Business Economic Outlook for 2021, franchise businesses in the United States have a higher success rate compared to independent businesses. In fact, the report states that the 5-year success rate for franchise businesses is around 90%, compared to around 20% for independent businesses.
This is because franchises typically come with an established brand, proven business model, and ongoing support from the franchisor, which can help reduce the risks associated with starting a new business. Additionally, franchisors often provide their franchisees with comprehensive training and support, which can help them navigate challenges and make informed business decisions.
However, it’s important to note that success rates can vary widely depending on the specific franchise, industry, and location. Before investing in a franchise, it’s important for potential franchisees to do their research and carefully evaluate the opportunity, including reviewing the franchisor’s disclosure documents and speaking with current and former franchisees.
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