The restaurant franchise industry has been booming since the early 2020s. And why not?
According to the latest report by Zippia, the annual turnover for any franchise restaurant is around $1500000. The same data also reveals that franchise owners have much higher sales than independent restaurants. A few examples are McDonald’s ($2.94 million) and Chipotle ($2.2 million).
Franchises are a smart and secure way to succeed in the restaurant industry, letting the franchisees work in the marketplace with the top brands in the industry. By owning a franchise, restaurateurs not only gain easy access in a crowded and highly competitive market but also procure the top resources and experience to stay in business.
However, when it comes to investing in a franchise business its good to do a through evaluation. Do consider these factors for a smooth entreneurship journey.
Key Factors for Franchise Business Success
Selecting the most profitable franchise to own is a crucial decision that requires a lot of consideration. Here are some key factors that you need to look into before starting your franchise journey.
- Cost of acquiring a Franchise
To make the best investment for your business, you need to be looking into franchises that are within your investment range. This includes franchise fees and royalties. Make sure they fit into your budget before you own a franchise to yield maximum profits.
- Training and support
Your franchisor’s obligations shouldn't end, once your store is up and running. Carefully look into the training programs provided by the franchisor. Not only training, but check if your franchisor provides assistance like help in site selection, technology integration, marketing, and operations.
- Brand reputation
The primary benefit of owning a franchise is being associated with an already-established brand. Look for online reviews and customer feedback regarding the brand to know how the customer perceives the brand. This helps you understand that the franchisor and you are on the same track which leads to customer satisfaction.
- Competition
If there’s low competition in what you want to sell, it will benefit you. It’s true for every business. For example, if there’s a fast food franchise selling sandwiches located around every corner in your area, it would be difficult to attract customers if you open yet another sandwich outlet.
- Contract period
Before signing the contract with your franchisor, carefully read the terms and conditions of the agreement which includes the contract length, clause for termination, and renewal options.
- Exit strategy
It might not always go according to the plan. Have an open conversation with the franchisor regarding the exit strategy like whether in the long term can you sell or transfer the franchisee if needed.
Now let’s look into some of the most profitable franchises to own in 2024.
Best Franchises to Own in 2024
Chick-fil-A
Has it ever happened when you walked into a Chick-fil-A and it was never busy? Founded in 1967, this fast-food restaurant has wowed customers with its delicious chicken dishes.
Number of locations: 2000+
Investment: Franchise fee of $10,000 with investments between $580000 to $2.20 million
Type of food: Fried chicken
Royalty fee: 15%
Annual sales: 5.8 billion US dollars in 2022
Dunkin Donuts
These days you cannot go wrong with coffee and donuts and that’s not everything that Dunkin offers. You can also buy frozen drinks, sandwiches, bagels, and muffins. What once began as a single outlet in the US in the 1950s has now turned into one of the most profitable franchises to own.
Number of locations: 8500+
Investment: Franchise fee of $40,000 - $90,000 with investments between $4,30,000 to 1.7 million US dollars
Type of food: Coffee and donuts
Royalty fee: 6%
Annual sales: 1.4 Billion
McDonalds
“I’m lovin it”. People have been saying this since the 1950s whenever they have visited a McDonald’s and why not? They have been a staple for burgers, fries, and coke for Americans for decades now.
Number of locations: 40000+
Investment: Franchise fee of $45,000 with investments between 1.5 to 2.5 million US dollars
Type of food: Burgers, fries, and coke
Royalty fee: 4%
Annual sales: 23.18 billion US dollars in 2022
Taco Bell
This dynamic Mexican fast-food chain topped the list of the 2023 Franchise 500 ranking. They have a unique and creative menu item and provide a fun and innovative twist on the age-old Mexican cuisine.
Number of locations: 7500+
Type of food: Tacos, burritos, quesadillas, and nachos
Investment: Franchise fee of $25,000-$45,000 with investments between $575,600 - $3.3 million US dollars.
Royalty fee: 5.5%
Annual sales: 2 billion US dollars in 2022
Papa John’s
Do you want to own multiple franchise units and run them at the same time? Then look no further than Papa John’s. If you have to pick one food item that will be as popular in the future as it is today, it will be pizza, making Papa John’s an ideal choice to own a franchise.
Number of locations: 5000+
Type of food: Pizza
Investment: Franchise fee of $25,000 with investments between $200,00 - $788000
Royalty fee: 5%
Annual sales: 2.3 billion US dollars in 2022
Firehouse Subs
If you want to be a part of a franchise that gives back to the community, then Firehouse Subs is perfect for you. Founded in Jacksonville, Florida by two former firefighters, a portion of their sales is used to purchase life saving instruments for first responders.
Number of locations: 1200+
Type of food: Sandwiches
Investment: Franchise fee of $20,000 with $400000 investment
Royalty fee: 6%
Annual sales: 695 million US dollars in 2022
How Delightree helps Franchise Business
In today’s digital era technology plays an instrumental role in making any business successful and a franchise business is no different. Multiple growing franchise businesses have put their trust in Delightree to manage their franchise across multiple locations in the United States. With our all-in-one app, franchisees will have one-click access to all the SOPs, training documents, training modules, policies, videos, and FAQs. Franchisors can update these documents in real time, saving time and money for their franchise operations. Get ready and start your franchise journey with Delightree.
