When did franchising actually start? There are many different interpretations about what constituted the earliest form of franchised operations. Some say it was during the 19th century, and others trace its origins to 200 AD. But the correct answer is the Middle Ages.
Back then European monarchies allowed noblemen and the church to manage lands that belonged to the Crown. They were charged with protecting the territory and collecting taxes. The nobles granted local farmers the right to use a piece of land in exchange for royalties. This is considered the first franchise operation in history.
Fast forward a few centuries and the world was adding another continent to the map that quickly became a brand new venue for business expansion. In the 1850’s, Isaac M. Singer was in the business of making sewing machines. He had a brilliant product but lacked capital for mass production. He devised a business model in which he sold licensing fees to people that wanted to sell the machines and teach others how to use them. Thus, the oldest franchise in the US was born, and others soon followed.
You might’ve heard about Coca-Cola. In 1886, John S. Pemberton invented the now famous beverage and wanted to expand his business. Just like Singer before him, Pemberton licensed his drink to a select group of sellers. Coca-Cola quickly became the biggest franchise in the world, at least when it comes to fizzy drinks.
The real boom for the franchising industry came during the baby boom era. World War II was over, the world was getting back on its feet, and people needed lots of new products and services. This gave rise to a string of new franchises throughout the 1950s and 1960s, including one that would eventually morph into the biggest fast food chain in the world - McDonald’s.
One of the more interesting McDonald’s franchise facts relates to how it evolved from a humble burger stall to a chain of restaurants. The person credited for this success wasn’t one of the McDonald brothers but Raymond Albert Croc.
Before stumbling onto McDonald’s, Croc was selling milkshake mixers. One day, he learned that his regular customers, the McDonald brothers, managed to use eight of his machines at the same time like a conveyor belt. Coincidentally, the brothers were looking to turn their business into a franchise. It was a match made in heaven, and just a few years later, there were 500 restaurants across the United States. Today, about 80% of all McDonald’s locations are franchises.
Franchising today is bigger than ever. Some of the most popular products and places are part of global franchises. You can pick almost any random product in a convenience store, and there’s a good chance that it was produced by a franchise. As a matter of fact, it’s highly likely that the very store you’re browsing through is another franchise.
Among those are some truly astonishing franchises and brands. Some of them have tens of thousands of locations and are as old as the US itself.
The world’s biggest franchising success story is more than 60 years old. McDonald’s now has more than 38,000 locations worldwide and employs nearly two million people. In an effort to meet the needs of customers, the food franchise is evolving by investing in tech. In 2019 alone, the company struck a $300 million acquisition deal with a personalization and decision logic technology firm. That was followed by the purchase of stakes in several companies that develop mobile apps, mobile payment systems, and even artificial intelligence.
There are more than 41,000 Subway restaurants in the world. That means that the company opened, on average, two new restaurants every day since it was founded in 1965. The company also sells 7.6 million sandwiches every day.
McDonald’s might be the most popular franchise, but the top spot for the number of locations goes to the retail chain 7-Eleven. The company recently opened its 71,100th store, which is located in South Korea's capital, Seoul. 7-Eleven has stores in 17 countries across the globe
Founded in Chicago in 1918, this car rental franchise is now present on all continents with more than 10,000 units. It was originally known as Rent-A-Car Inc. with a humble offering of just a dozen Model T Fords.
One of the more important franchise facts about the hotel industry involves Marriott International. This hotelier spent the last seven years at the top of that industry. Throughout 2019, the company signed 815 hotel deals.
This professional baseball team was founded in 1883 and has been playing in the National League ever since. It has never changed its name or the city where it’s located, a very unique characteristic for a sports franchise.
It may not be considered the best franchise in the fitness industry, but Anytime Fitness has really gone somewhere nobody else dared to go. To Antarctica. Just because there’s too much ice, doesn’t mean the company's growth has to stop. By opening a studio on the cruise ship Magellan Explorer, the franchise owners can say they have the coolest gym in the world.
The surest thing in the franchise business is a food and beverage franchise. People may not need to rent a car every day, but they’ll always need to eat.
Every business has a story, and franchises are no different. Some of the more unusual stories come from businesses that became part of the franchising industry. And, like any business, a franchise will need to adapt to overcome hurdles along the way, more often than not influencing its competitors to do the same. From name changes and recipe changes to the most outlandish events in modern business, here are some statistics and very unusual facts about franchising.
There are many factors that determine how much money you’ll be able to make from taking up a franchise. So far, the food and beverage business has shown to have the highest potential for turning a profit, with an average annual income of $120,000. It also helps if you own multiple units. The initial investment might be higher, but so will your franchise revenue.
Here’s a franchise fun fact: the list of top franchises is heavily dominated by fast food chains. Among those are McDonald’s, KFC, Pizza Hut, Burger King, Domino’s Pizza, Dunkin’ Donuts, and Subway.
The food and beverage industry is by far one of the best industries for franchises. The investment doesn’t have to be big. Daily running costs are lower than in other industries, while the turnover is undoubtedly the best.
There are many advantages to having a franchise. It’s a proven recipe for growth and offers a source of capital with investors more likely to invest into a franchise establishment than smaller businesses. A franchise also offers a way to overcome great distances. These franchise facts have helped many in the business world make money.
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