HOW TO CHOOSE THE RIGHT FRANCHISE IN THE USA?

 HOW TO CHOOSE THE RIGHT FRANCHISE IN THE USA?

Choosing a franchise in the USA can quickly become a daunting task. There are so many brands and so many different models that it's easy to get lost! How do you choose the right franchise for your profile? How do you evaluate a franchise in the USA? Which brands should you focus on? Investir.US guides you through finding the right franchise in the USA.

Choose the franchise that suits you!

Franchising is a very interesting niche for a small business. It can become a gateway for new entrepreneurs to learn how to start their own business and offer those who are not yet comfortable taking the first step towards entrepreneurship the opportunity to take the leap. Of course, not all franchises are created equal. The franchisor, and especially the manager, has a significant impact on the success or failure of a franchise system in its efforts to expand through franchising.

Great franchises share one thing in common: the franchisor views franchisees as partners and is as interested in them as they are in their own business. A well-established franchise system is a powerful lever for speed, growth, and empowerment.

To choose the right franchise in the USA, you first need to decide whether you want to be a franchisee or a small business owner.

Small business owners or true entrepreneurs value the freedom to make unfettered decisions in running their business. They also want to take their own risks in building their brand.

A franchise owner, on the other hand, is someone who prefers the structure, guidelines, and proven business system that comes with the model they're part of. Franchisees are more likely to follow the rules, less concerned about their egos, and more comfortable complying with the general requirements and guidelines of a franchise brand.

What type of franchisee are you?

It's up to you to decide: think about your profile as a potential franchisee. Then, identify your financial capacity to start a business.

Typically, most franchises require you to have a certain amount of fixed capital to start your business. This amount should cover, for example, equipment, construction, inventory, supplies, and other items needed to open the franchise doors and get started.

It is considered that for a single person without children, a sum of $100,000 is enough to consider starting a franchise.

Also to consider: the franchise you choose must be willing to accept foreigners coming to settle in the USA. In particular, it must meet the requirements for the E-2 visa, for example.

Research markets before researching franchises

If you have your heart set on a particular franchise, your first objective should be to determine whether the franchise you're entering offers attractive opportunities. Identifying markets and opportunities is a key step. It will help you determine which franchise brands to focus on. Emotional factors must be put aside, or you risk making the wrong business decision. Therefore, careful market research should be conducted beforehand. Develop your plan, then find the franchise system that will help you implement it.

Finally, interview the franchisor as you would any important decision. Don't take anything lightly. Take the time to understand the terms of the agreement you're entering into and get to know the franchisor. The best franchises are run by people of integrity, vision, and concern for their franchisees.

YouTube video player

Discover the Investir.US FRANCHISE BOOSTER program

How to evaluate a franchise in the USA?

There's no one-size-fits-all franchise model. Entrepreneurs looking to open a franchise in the US should consider their budget constraints and the franchisor's support system during the evaluation phase.

Among the criteria to take into account:

Franchise fees and setup costs

Each franchisor requires an entry fee that can range from a few hundred to several hundred thousand dollars.

The royalty must be paid by the franchisee – this is preferred, although some franchisors offer financing options. An initial investment of $10,000 is recommended.

Profitability

Every business investment requires some thought: Is it worth the risk? Determining the profitability of a franchise isn't an exact science, of course, but there are certain factors to consider:

Unit growth (locations): How many units have been opened in recent years?

New franchise success rate: What percentage of new franchises are still in business after one year?

Franchisor's finances: what is the average sales per unit?

Franchise support systems

When choosing a franchisor, consider the support systems in place to ensure the success of a new location. For example, does the franchisor offer a basic training program?

Commitment over time

Operating a franchise is a decades-long commitment. No franchisee can claim to be operating a business after just one year. So, are you willing to stay in business for a while? For how long? If your vision is ten years, for example, choose a brand whose franchises are easier to sell.

Available geographic areas

Most, if not all, franchisors are looking to expand into a specific geographic area. Is the franchisor you're considering interested in opening a location in your area? If not, are you willing to relocate?

Brand recognition or growth

How well-known is the brand you're interested in? How has it evolved over the past few years? Note that sometimes it's not wise to opt for a big, well-known brand, as the initial costs are high.

A smaller franchisor may be an easier entry point for you, provided the business demonstrates growth, of course.

The 10 Most Profitable Franchises in the USA

Choosing the right franchise in the US is a sure way to maximize your chances. Here are 10 profitable franchises right now:

Discover the Investir.US FRANCHISE BOOSTER program

1. McDonald's

Does the fast-food giant still need an introduction? McDonald's enjoys unparalleled brand awareness, and owning a McDonald's franchise, regardless of location, guarantees a loyal customer base—a prerequisite for generating revenue.

McDonald's requires a significant initial investment. Potential franchisees must have access to at least $500,000 in cash to be considered.

Initial Franchise Fee: $45,000

Estimated Initial Investment: $1 million to $2.2 million

2. Dunkin

Dunkin' also enjoys significant brand awareness, particularly in the northeastern United States, where the doughnut business is a veritable institution. Like McDonald's, franchisees benefit from a strong support system. However, this advantage comes at a cost: the initial investment is substantial. Franchise applicants must have at least $250,000 in cash and a minimum net worth of $500,000 per unit. These figures vary depending on the location.

Initial Franchise Fee: $40,000 to $90,000

Estimated Initial Investment: $95,700 to $1.5 million

3. The UPS Store

For several years, the UPS Store has ranked among the top five on Entrepreneur magazine's Franchise 500 list. The main reason for this position lies in the franchisor's strong training system and support for new franchisees. The brand's reputation and impeccable reputation also contribute to the franchise system's appeal.

Opening a UPS Store franchise typically requires a smaller initial investment than opening a grocery franchise. There are also programs and incentives available to help ease the initial investment. To be eligible for a UPS Store franchise, you must have at least $60,000 in cash.

Initial Franchise Fee: $9,950 to $29,950

Estimated Initial Investment: $138,433 to $470,031.

4. Dream Vacations

Anyone interested in opening a travel agency should consider the Dream Vacations franchise. It's one of the most profitable franchises, and the investment is low. Depending on the franchisee's experience, the initial costs can be as low as $495.

Not requiring a physical location, the brand also offers opportunities for people who prefer or need to work from home.

Initial Franchise Fee: $495 to $9,800, depending on experience level

Estimated Initial Investment: $1,795 to $20,300

5. The Maids

The Maids Cleaning Company offers franchisees over 40 years of experience. The company generates annual revenue of approximately $1.1 million. Its most successful franchise generated revenue of $6.5 million in 2019. Additionally, the initial franchise fees and other startup costs are much lower than most other cleaning franchise opportunities. Expect a total initial investment of less than $200,000 at the higher end of the scale.

Initial Franchise Fee: $12,500

Estimated Initial Investment: $48,950 to $124,950.

6. Anytime Fitness

Anytime Fitness's unique feature is that it offers 24/7, year-round access to its facilities. This promise maximizes each franchisee's chances of generating revenue, with the brand claiming to recruit a new member every minute.

One of the unique features of Anytime Fitness is that it doesn't charge monthly royalties based on total sales. Franchisees pay a fixed monthly fee of $699.

Initial Franchise Fee: $3,150 to $42,500

Estimated Initial Investment: $58,870 to $521,437

7. Pearle Vision

Founded in the early 1960s, Pearle Vision revolutionized the eye care industry by combining retail and medical experience under one roof. Pearle Vision is now owned by Luxottica, the world's largest eyewear manufacturer. This provides its franchisees with access to a wide range of mid- and high-end eyeglasses and sunglasses.

In 2018, Pearle Vision franchises that employed an optometrist averaged $1.325 million in revenue, with $1.04 million generated from retail sales.

Initial Franchise Fee: $30,000

Estimated Initial Investment: $391,795 to $620,538.

Give your franchise project the best chance of success Discover our FRANCHISE BOOSTER program

8. JAN-PRO

One of the world leaders in commercial cleaning and janitorial services, it has over 25 years of experience and several innovative and exclusive cleaning systems.

JAN-PRO offers potential franchisees three options, depending on their level of experience and investment.

Initial franchise fee: $1,000 to $20,000 depending on the type of franchise chosen

Estimated initial investment: $1,000 to $768,000.

9. Supercuts

Supercuts: The name resonates in the hairdressing world. This is likely due to the fact that the brand has been around for over 40 years, as well as the number of locations, which now stands at over 2,500.

Supercuts franchisees diversify their income by selling hair care products and salon services. To qualify to open a Supercuts franchise, you don't need to have hairdressing experience. However, you must have a total net worth of $500,000, $150,000 in liquid assets, and good credit to be considered.

Initial Franchise Fee: $39,500

Estimated Initial Investment: $151,370 to $321,020.

10. Ace Hardware

Ace Hardware offers potential investors three types of franchise opportunities: opening a new Ace Hardware store, converting a current location into an Ace Hardware store, and opening an Ace Hardware grocery store.

The brand offers franchisee training and marketing support, while also providing access to a vast supplier network. The company does not charge monthly royalties, eliminating a significant expense required by most other franchises.

Initial Franchise Fee: $5,000

Estimated Initial Investment: $286,000 to $1.07 million.