Editor’s Resource 

Contact: Terry Hill, 202-628-8000

WASHINGTON, D.C. – Small business is big.  That sounds like an oxymoron, but in reality, the network of franchised-small businesses operating today is extensive.  While franchise owners run their businesses as small, local enterprises, they certainly are not alone.  There are hundreds of thousands like them who operate in the marketplace. 

Franchising is a powerful economic force, according to a study conducted for the International Franchise Association’s Educational Foundation by PricewaterhouseCoopers, which found that there are more than 760,000 U.S. franchised establishments generating in excess of $1.5 trillion in economic activity and producing one-out-of-every-seven jobs.   

Another foundation study “The Profile of Franchising 2006,” conducted by FRANdata Corp., determined that 900 new concepts began franchising in the United States between 2003 and 2005.  And out of the existing brands, 17 of the 18 categories of business experienced significant growth. 

Is there something out there for everyone?  The sheer numbers of franchises suggest that there is likely a franchise for the majority of interested prospects.  But it’s the diversity of investment levels, concepts and brands that make the franchised-business model attractive to a multitude of different investors. 

Franchisee candidates have a wide range of opportunities in more than 80 lines of business, in investment ranges from as low as $10,000 to more than $1 million, and that operate as business formats of all shapes and sizes.  The concepts include, but are not limited to, those related to healthcare, art education, hotels, personnel services, real estate, automotive, travel, maintenance and construction.

While their names may not be as easily recognized as some quick-service restaurants closely identified with Golden Arches, brands from less well-known concepts are gaining ground in the marketplace.  For example, Abrakadoodle, a Virginia-based franchise providing comprehensive art programs for children, grew to 65 units in just two years. 

Where should a prospective franchisee begin?  On the Web at www.franchise.org, the International Franchise Association’s content-rich site where tomorrow’s franchise owners can transform their lifelong passions and strengths into realities in the form of the franchised-small business of their desires.  But the opportunity for franchise ownership is not one to be taken lightly.  Thorough investigation and careful consideration are necessary steps on the path to becoming a franchisee. 

IFA, which represents more than 10,000 franchisees and 1,200 franchise companies, has developed a toolkit of resources at www.franchise.org, including information from a variety of publications, educational seminars and trade shows designed to help equip those new to franchising with the information they need to make the dream of franchising a reality. 

IFA also offers a free online course, “Franchising Basics,” and promotes the Federal Trade Commission’s “Consumer Guide to Buying a Franchise,” a brochure that helps franchisee candidates learn more about the industry and better determine if franchising is the right match for their entrepreneurial interests.  A variety of educational seminars planned during the next few months enlist the help of franchise experts to shed light on topics pertinent to prospective investors, such as understanding the components of companies’ franchise disclosure documents.  

The FTC recently revised core elements of its Franchise Rule to improve the amount and quality of information available to potential investors to help them become more aware of their obligations as franchisees.  IFA urges prospective investors to consult experts knowledgeable in franchising, particularly attorneys and accountants, to help them thoroughly understand the franchise’s offer.

 Franchising is big and growing bigger daily.  Properly explored and engaged, this expansive network can foster productive and mutually-beneficial relationships for those who seek to be in business for themselves but not by themselves. 

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Editor’s Note : To review the studies mentioned in this Editor’s Resource--The Profile of Franchising 2006 by FRANdata Corp and The Economic Impact of Franchise Businesses by PricewaterhouseCoopers--visit www.franchise.org.  

To inquire about press credentials for upcoming Franchise Expos in Los Angeles (Oct. 19-21) and Miami Beach (Jan. 9-11), send an e-mail to thill@franchise.org.  Press passes are available for legitimate news media organizations, limit two per company. 

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