The franchise industry is skyrocketing and achieving incredible growth in terms of business. There are more than 700,000 franchises in the USA alone.
Each year, around 300 companies start franchising, which accounts for 3% of the Gross domestic product and employs about eight million Americans as of the current financial year.
Several exciting franchise statistics have proven that the franchise business is the easiest way to make a profit.
This article discusses franchise statistics for 2022 and some hidden facts you have never heard before. So, keep reading to learn more.
Key Franchise Statistics & Forecast 2023
- According to franchise.org, the total number of franchises in the U.S. is predicted to increase by 1.9% or 15,000 units totaling 805,000 units.
- In 2023, the total output of franchised businesses is expected to increase by 4.2% to $860.1 billion as compared to $825.4 billion in the previous year, 2022.
- The franchise sector is expected to add around 254,000 jobs in 2023, driving the total franchise employment to an estimated 8.7 million.
- It is predicted that the franchise industry’s share of the GDP will remain stable at 3%.
- Quick-service restaurants and service-based franchises will witness the highest growth in the franchise sector.
How many franchises are there in the US Currently as of July 2023?
As of July 2023, there are an estimated 828,138 franchise establishments in the United States.
State Wise Franchise Franchise Growth Prediction:
- It is predicted that states in Southeast and Southwest will see the highest franchise growth in 2023.
- The Southeast region in the U.S. has the largest franchise concentration, so it is estimated that it will see a total of 234,079 total establishments by 2023, contributing $250 billion to the U.S. economy and employing 2.5 million workers.
- The top ten states predicted to see the highest franhcise growth are:
- North Carolina
- South Carolina
Sector Wise Franchise Key Forecast 2023
Commercial and Residential Services
- Commercial and residential services in the franchise sector are predicted to grow by 2.1%, reaching 80,000 establishments in 2023.
- The demand for leisure travel is expected to increase in 2023.
- Franchised businesses in the lodging sector are expected to rise by 0.8% to 35,833 sites.
- Also, employment in the franchise lodging sector is expected to reach 716,656 jobs.
- Personal Services will lead franchise expansion in 2023, witnessing the most growth in the number of outputs and establishments.
- In 2023, Personal Services establishments are also expected to increase by 2.5% to 120,302 locations.
- In addition, it will also add 577,450 new jobs.
Retail Food, Products, And Services
- In 2023, the total count of retail franchise establishments to add 10,000 additional jobs and grow by approximately 360 units.
- In 2023, it is estimated that franchise establishments in real estate services will reach 68,300, showing a 0.5% decline in growth.
- Employment in this sector is also predicted to decline by 1,000 jobs.
- However, the franchise output in the real estate sector is expected to reach $62 billion showing an increase of 2.3%.
Franchise Statistics In the USA
- 750,000 franchise establishments – A total of 750,000 are there in the U.S., and the list is growing daily.
- The biggest Pizza franchise in the U.S. – With annual sales of $12.25 billion, Domino is the biggest Pizza franchise in the U.S., followed by Pizza Hut with yearly sales of $5.56 billion.
- The most lucrative franchise in the U.S. – McDonald’s is the most lucrative franchise in the U.S., which generates more than 93 billion in sales each year.
- The economic output of franchise establishments – In 2020, Due to Covid, the economic output of the U.S. franchise industry plummeted a lot. It generated only $670 billion of economic output compared to the output of 787.5 billion in 2019.
- Leading U.S. franchise by sales 2020 – In 2020, USA’s McDonald’s reported $93.32 billion in sales globally, followed by 7-eleven, which accounted for $91.8 billion.
- The decline of Subway stores in the U.S. – Over the last five years, Subway stores in the U.S. has decreased from 27 thousand to 22 thousand.
- Subway Franchise Investment is very expensive – the initial subway franchise investment as of 2022 is $506,900, with lease hole improvements making it the most costly franchise investment.
- The U.S. business services franchise industry – Between 2013-2019, the economic output of the business services franchise industry in the U.S. increased by 30%. It generated $106 billion, but in 2020, due to covid, it fell to $91.3 billion.
- The output of franchise establishments – Quick service restaurants in the U.S. generated 260 billion U.S. dollars in 2021, which is the highest output, followed by retail food services and products, which gave an output of 127 billion U.S. dollars.
- Personal services franchise output – Between 2013 and 2019, the personal services franchise output was steady, reaching 39.3 billion U.S. dollars. However, in 2021, due to Covid, this sector’s output plummeted greatly and came down to 26 billion U.S. dollars.
- Output generated by residential and commercial service franchises – Between 2007 and 2020, the overall output of residential and commercial services increased by ten percent and reached 49.3 billion U.S. dollars.
- The employment rate in the business service franchise industry – Between 2013-2019, there was a steady growth in the number of people employed in the business service franchise industry, reaching 650,000 approx. However, in 2020, it fell to 588,000 owing to Covid.
- Leading Quick service chain restaurant in the U.S. by sales – With sales of 5.01 million U.S. dollars per unit, Chick-fil-A was the Leading Quick service chain restaurant in the U.S. in 2020.
- Consumer spending in the QSR sector – In 2021, consumer spending in the quick service restaurant sector U.S. exceeded three hundred billion U.S. dollars.
- Oldest Franchise – The oldest one-city, one-name sports Franchise in the U.S. is Philadelphia Phillies.
- Sports Franchise – The market size of sports franchises in the U.S. in revenue is $43.4bn as of 2022.
- Franchise Success Rate – Based on 2019’s research data, the 2-year success rate of a franchise is 8% more than the success rate of an independent business.
- Total Franchises – There are more than 300 different franchise industries in the U.S. franchise sector.
- LGBTQ Franchise Owners – In the U.S., approximately 10% of the people who own a franchise are LGBTQ.
- Franchise Owners Earnings – In the U.S., the top 10% of franchise owners earn more than $90,000.
- Sports Franchise Growth – Between 2017 and 2022, the sports franchise market size has grown by 2.1% on average.
- International Franchises – Out of the top 200 US food franchises, 39% are international.
- Working Franchise Owners: 80% of the franchise owners in the U.S. work in the private sector, followed by 19% in the public sector and 1% in education.
- Franchise Sales – In the U.S., the total sales by franchise businesses are predicted to cross $2 trillion.
- Failure Rate of Smoothie King – Smoothie king’s franchise failure rate is 28%.
11 Franchise Statistics That Will Blow Your Mind
When we look at the statistics for the last two years, it didn’t have any positive response.
Deep down, we all knew that the pandemic hit the world retail industry and still didn’t recover from it.
But if we analyze the statistics before the pandemic arrived, it was amazing and gave a positive response which means the franchise has many possibilities to earn profit.
Let’s look at franchise statistics that provide greater insight into the industry’s current state.
1. 300 Companies Started Franchising Every Year
One of the most notable facts is that more than 300 companies begin franchising every year, which is surprising growth and a trend that is likely to continue for several years.
But not all companies will get successful in the long run and operate a franchise.
A small percentage of 300 can get success in owning and operating a franchise.
2. Franchises Employ More Than 8 Million Americans
A franchise gives employment to over 8 million Americans; out of that, 50% of employees work at fast-food or food services restaurants.
3. 3% Of GDP Comes From the Franchise
Franchises are also contributing to the economy of America, which is shown by the fact that around 3 % of the nation’s GDP comes from franchises.
Moreover, the numbers will likely grow as more businesses try to start a franchise in the upcoming years.
4. Franchise Owners Have A Bachelor’s Degree Or Higher
62% of franchise owners only have higher education and are knowledgeable in the business.
So, the franchise doesn’t require any high qualifications. You can easily manage your business with knowledge.
5. America Serves As The Headquarters Of Franchise
Several sources say that the USA serves as the headquarters for 18 of the top 20 franchises worldwide, and 10.5% of all businesses are Franchised in America.
6. 828,138 franchise owners in America
There are nearly 828,138 franchise owners in America, according to Zippia.
7. Male VS Female Franchise Ownership
Regarding franchises, there’s no difference between male and female ownership.
In fact, over the past decade, 38% more women have become franchise owners than men did at one point in time! And out of all new businesses opened within two years – 32 percent are run by ladies, too, so this genre has something special about them.
8. Franchise Business Vs. Other Business Percentage
According to the U.S. Census Bureau. 10.5% of all businesses are franchises.
9. 62% of franchise owners have a bachelor’s degree
This is not surprising given how much time and effort goes into opening new locations, but it shows just what type of minds are needed for this industry!
10. $41 Billion In GDP By Veterans till 2021
Every year, thousands of veterans decide to turn their lives over again by becoming franchisees.
These brave individuals have served our country and found success as entrepreneurs with 66000+ franchises generating $41 Billion in GDP under one roof till 2021.
9 Franchise Fun Facts
- 750,000 Franchises are in business in the USA alone
- Franchises employ more than 8 million citizens of America.
- 3000 types of different franchise industries comprise the USA franchise Sector.
- 80% of franchise brands are local and regional, while 16% are national or global.
- Franchises business accounted for 10.5% of all business in 2007.
- Food franchises make less than $50,000 per year in net profit.
- The success rate of franchise businesses is about 8% higher.
- Every 8 minutes, a new franchise opens during an individual business.
- Most of the owners of the franchise are men. Women’s ownership jumped after 2011. Between 2011 to 2017, we notice an 83% growth in women’s ownership, and still growing.
The Biggest Franchise & Its Statistics
- McDonald’s is the biggest franchise in the world. It has more than 38,000 Outlets in 117 countries. Followed by. Subway has 44,758 outlets in 122 countries. Subway has more outlets than McDonald’s, but still, McDonald’s is the biggest franchise compared to investment and profit.
- The franchises with the most business units are gas stations, hotels/hospitality, full-service restaurants, and new car dealers.
- Marriot International is always placed at the top of the hotel industry.
- McDonald’s and Subway might be the most popular franchise, but the top place for the number of outlets is the retail chain 7-Eleven. A 7-Eleven convenience store has more than 71,100 stores in 17 countries.
- Anytime Fitness is the first franchise that has outlets in all seven continents.
How Many Franchise Organizations are in the USA?
As per the most recent stats released by Statista, The franchise industry now has estimated over 753,770 franchise organizations in the United States as of 2022.
According to the U.S. Census Bureau report on franchising, the franchising industry accounts for 10.5% of all companies with paid employees in 295 industries.
The segment accounted for a whopping 1.3 trillion dollars of 7.7 trillion dollars in total sales of these industries.
The highest number of franchise organizations is:
- Fast food restaurants or limited service restaurants -124,898
- Gas stations with convenience stores -33,991
- Full-service restaurants -30,130
By the output generated, the highest-grossing franchise organizations are:
- New car dealers -$687.7 billion
- Gas stations with convenience stores $131.1 billion
- Limited-service restaurants $112.6 billion
Franchise Employment Distribution by Sector
- In 2023, Business services are predicted to add 5.2% and personal services 4.7% to the labor force.
- Because of the continuous demand for food delivery, the QSR will continue to expand in 2023.
- The overall QSR employment is expected to increase by 3.5%.
- QSR sector is even predicted to account for 45.3% of all franchise employment in the franchise sector in 2023.
- Almost 12.8% of franchise employment is in full-service restaurants, followed by business services, commercial and residential services, personal services, and real estate.
Franchise Owner Statistics By Gender
Franchise Owners By Gender
Franchise Owner Gender By Year
Franchise Owner Statistics by Race
67.2% franchise owners are white in the U.S. followed by Hipsanic, Asian etc.
Franchise Owner Race
|Franchise Owner Race||Percentages|
|Hispanic or Latino||15.4%|
|Black or African American||6.2%|
|American Indian and Alaska Native||0.5%|
Average Franchise Owner Age By Race
Have a look at the age of franchise owners based on their race.
|Race||Male Age||Female Age|
|Black or African American||42||45|
|Hispanic or Latino||42||40|
|American Indian and Alaska Native||43||44|
Franchise Owner Age
Note that a majority of the franchise owners are 40+ in age.
|Franchise Owner Years||Percentages|
Franchise Owners & Their Education Level Satistics
Franchise Owners By Education
|Franchise Owner Degree||Percentages|
|High School Diploma||7%|
Franchise Employment Growth
- In 2022, the unemployment rate decreased to 3.5%, one of the lowest in history, and the demand for labor was more than the supply. This led to wage growth of 9% in 2022, but by the fourth quarter of 2023, it reduced to 6.4%.
- Now in 2023, the wage growth in the franchise sector will, although low, is predicted to grow by 3%.
- As per IFA/FRANdata 2023 labor survey, 81% of franchised brands faced hurdled growth due to the labor challenges continuing since 2022.
|2020||2021||2022 (Est.)||2023 (Est.)|
|Commercial and Residential Services||253,682||288,542||303,650||310,026|
|Quick Service Restaurants||3,544,759||3,728,402||3,802,722||3,937,161|
|Retail Food, Products, and Services||1,014,127||1,069,837||1,093,196||1,133,065|
|Percentage Change -6.5% 3.3% 2.7% 1.1%||-17.4%||14.9%||3.5%||1.1%|
Franchise Business Economic Outlook
|Output ($ Million)||$794,184||$677,236||$787,746||$825,367||$860,144|
|GDP ($ Billions)||$473.41||$446.32||$474.16||$500.22||$521.30|
Industry-Specific Franchise Forecasts
The QSRs and service-based franchises will see a massive growth in 2023. Rest of the franchise sector are still recovering from the pandemic years. As such QSRs and personal services is expected to grow by 2.5% in 2023.
Full service resturants, real estate and lodging would see a slower growth of 1.1%, -0.5%, and 0.8%, respectively.
|2020||2021||2022 (Est.)||2023 (Est.)|
|Commercial and Residential Services||73,116||75,678||77,850||79,485|
|Quick Service Restaurants||183,543||188,402||192,057||196,858|
|Retail Food, Products, and Services||157,538||162,579||165,636||169,114|
|Percentage Change -6.5% 3.3% 2.7% 1.1%||-6.5%||3.3%||2.7%||1.1%|
Regional Franchise Trends U.S.
The franchise growth in different state would vary depending on infrastructure, demand, population, etc. However, the Southeast and Southwest constitutes the largest franchise market providing $250.0 billion in total output.
Franchise Growth Rate of Top Ten States
Franchise Output by Business Line 2023
- It is estimated that the total output that franchised businesses will generate will reach $860.1 billion, which shows a bit slow growth rate as compared to the growth rate of 4.8% in 2022.
- In 2022, personal services, QSR, commercial and residential services, and real estate were the main driving factors for growth. But in 2023, because of increased demand, personal services will increase by 6.7%.
- Additionally, the output of QSR and business services is expected to increase by 5.1% and 3.8%, respectively.
|2020||2021||2022 (Est.)||2023 (Proj.)|
|Commercial and Residential Services||$49.3||$52.7||$56.0||$57.4|
|Quick Service Restaurants||$241.0||$261.2||$275.7||$289.6|
|Retail Food, Products, and Services||$121.1||$127.0||$130.0||$134.1|
|Percentage Change -6.5% 3.3% 2.7% 1.1%||-27.9%||31.9%||5.2%||2.2%|
Why Is Franchise Statistics Important To Analyze?
Statistics are not just facts or a few numbers. It allows you to evaluate claims-based quantitative evidence.
It is a collection of knowledge and procedure that helps you analyze the best data and differentiate between reasonable and questionable conclusions.
Investing in a franchise is an important decision in life. It can make and destroy your portfolio. Obviously, when we are investing money, so it’s important to do a cross-check.
So, before starting any franchise, you just must look at statistics first, giving you a clear vision of whether investing in the franchise is worth it.
Globally, one in seven businesses is a franchise, equating to around two million franchised companies and employing more than a 19million people.
As a US record, franchising contributes to the global economy every year.
We have now come to the end of this article, and these are some franchise facts that you can discuss.
Frequently Asked Question
What is the most successful franchise to own?
As per reports, the food and beverage industry are most successful franchise to own.
You don’t need a higher investment to run a beverage franchise. Working capital is lower than in other industries, while revenue is undoubtedly the best.
What is the success ratio of the franchise?
The franchise survival rate is 90%. As per data, franchising is the safest and lowest-risk way to start a new business.
How many franchises are there currently?
There are more than 753,770 franchises established in the United States in 2022.
Which is the low-cost franchise to buy?
One can buy low-cost franchises, including Cruise Planners, Help-U-Sell Real Estate, Jazzercise, United Country Real Estate, Stratus Building Solutions, Anago Cleaning Systems, and JAN-PRO. Some of them are home-based franchises you can easily manage from home.
Amit Gupta is an experienced expert in digital marketing and co-founder of DrFranchises. With more than 11 years of knowledge in franchise digital marketing, SEO, email marketing, and social media marketing, Amit has helped many brands achieve incredible success online. As a passionate entrepreneur and owner of 7 franchises, he continues to study franchise models, looking at costs, revenue, and profitability to guide brands toward profitable growth. When he’s not working on digital marketing, Amit enjoys spending time playing with his beloved dog.