There are a lot of ways to measure the value of a franchise opportunity. The most obvious is profitability, but there are many other factors to consider as well. Depending on your situation, you might be more interested in accessibility (e.g. how can you start a business duplicating a proven franchise model with a minimum buy-in and qualifications?) or solopreneurship. But today, we’re going to focus on the factor that probably should matter the most aspiring entrepreneurs, because it’s the factor that will keep you going through the inevitable ups and downs of business ownership: franchisee satisfaction. Because if you’re not satisfied running your business, why do it at all, right?
Categories, Not Specifics
Before we get started, a quick note: we’re discussing categories (industries) of franchise opportunity, not specific franchises. Why? Because focusing on a specific franchiser as though they are the only factor in franchisee satisfaction is doing them a disservice. Satisfaction is often more about the facts of the marketplace than the facts of the franchiser. Besides, it is relatively easy to avoid a specific “poor” franchiser — just Google them before you buy in, and if you see a 4-to-1 ratio of poor reviews, move on to another franchiser.
Categories/industries, however, are much more important, because if you choose the wrong industry in relation to your passion, skills and budget, you are far less likely to succeed, no matter which particular brand you choose to work with.
And The Winners Are…
We started with the Franchisee Satisfaction Awards, which show off the top 200 franchises with the most satisfied franchisees (as determined by a survey of more than 25,000 franchise owners). We then cross-referenced it against the Bond Directory of Franchisors to get an approximation of what percentage of franchise owners in each industry reported themselves as “satisfied.” Here are the industries that produced the most satisfied franchisees in 2014-15 — and thus, the ones you can expect will be the most likely to be successful in 2016.
- Home Services: Far and away the most satisfied group of franchisees are those working in the Home Services industry. This industry is largely solopreneurs and family or other very small, tight-knit groups. They spend their days going to people’s homes and providing services that are most often related to handyman work, painting, flooring, and installing appliances (e.g. point-of-use water heaters, and ductless heating systems). Buy-ins tend to be low, ranging from $30k to $110k and averaging around $70k.
- Senior Care: The second highest rated industry (in terms of satisfaction) is elder care; e.g. franchisees that care for the elderly, mostly in their own homes managing Home Health Care workers of various types. There are also many options for sales both retail and otherwise, selling products that empower and enable the elderly to care for themselves. Generally speaking, the franchisees in this industry tend to not perform much care personally; they are the brains that hire, train, organize, and enable hired workers to do the care. Buy-ins range from $65k to around $130k, with the average appearing around $87k.
- Food & Beverage: This category is a little broad, so we’ll narrow it down a little and say “Food & Beverage franchises that involve opening a storefront and running it,” because that’s where almost every satisfied franchisee in the broader group lies. This group tends to set themselves up as supervisors, hiring managers who in turn hire line workers; they spend their days examining their branch(es) from a bird’s-eye perspective and working out ways to succeed within the typically slim margins of the food service industry. Buy-ins range from $45k to just over $1 million — but the average is around $250k.
There you have them — the top 3 industries for franchise opportunities in 2016. Get into one of these industries because you are passionate about the industry; stay there because if you love the work when you get in, chances are you will be quite satisfied with your business for the long-term.
If you need additional guidance regarding these and other top franchise categories for 2016 and beyond, we encourage you to take advantage of our free, unlimited franchise consulting. Through a proven multi-step process, we help place aspiring entrepreneurs into the franchise business that best suits their passion, skills and budget. There is never a charge for our services, and your franchise fee is exactly the same whether you work with us or go directly to each individual brand. For further information, fill out the contact form at the bottom of this page.