5-Year Growth Rate Of Successful Franchise Systems Tops 8% Per Year

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FranchiseGrade.com, the #1 market research company in the franchise industry, reports that the top 25% of U.S. franchise systems averaged 8% growth over the last 5 years with 69,080 net franchise outlet growth.

It’s important for both franchisors and prospective franchisees, to recognize and understand how to differentiate among franchise systems.

FranchiseGrade.com published its latest Facts and Figures report based upon an analysis of the top 25% and bottom 25% of performing franchise systems. Drawing on its extensive database of franchisor FDD’s the FranchiseGrade.com report revealed significant differences between the top 25%, defined as positive growth franchise systems, and the bottom 25% defined as negative growth systems. For example, almost 80% of the positive growth franchise systems provide an Item 19 disclosure compared to less than 60% of negative growth franchise systems. In terms of overall franchisee turnover, the top 25% had 41.8% of all turnover attributed to transfers but only 20.4% of all turnover within the bottom quartile is attributed to transfers. These numbers indicates the bottom 25% had less franchise outlet success.

Commenting on the report, Jeff Lefler, CEO of FranchiseGrade.com stated: “It’s important for both franchisors and prospective franchisees, to recognize and understand how to differentiate among franchise systems and especially those at the top and bottom. The analytics that we provide in our Facts and Figures reports are intended to provide meaningful information for the franchise industry.”

A copy of the report is available here.

About FranchiseGrade.com
FranchiseGrade.com is the #1 market research within the franchise industry. Our motivation is simple: we want to raise the bar in franchise industry market research and build a stronger franchise community in the process. By surveying as many as 18,000 franchisees and reviewing more than 2,500 Franchise Disclosure Documents every year we are able to maintain an extensive database of current franchising information for our industry leading research and analysis.

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