Which franchise industries are the most profitable?

ByFranchise Discovery

India is the third-largest consumer of goods and services and a mega-market for the most profitable franchise business. Franchise business helps in the expansion of a brand across the globe. New generations are coming up with amazing ideas to make the franchise industry more profitable in long run. However, when you zero in to invest in the franchise industry, figuring out which type of franchise to open needs a lot of research.

Recent studies of Census Bureau and Sageworks have released documents on franchise industries with high profitability and industry most sought after.

Sageworks analyst Libby Bierman said profitability varies majorly by industry, so anyone looking to open a franchise in a particular industry would be smart to examine industry trends. “Some industries — like gas stations and new car dealers — rely on volume for growth, so you can’t say that in all cases, a higher profit margin is required to be successful,” she said. “However, stronger profitability certainly makes it easier to turn sales into income for the owner.”

As per the Census data, the most popular franchise industry is limited-service restaurants. Franchising giants in the limited-service restaurant field include McDonald’s, KFC, Burger King, and Pizza Hut. The industry on average has generated net profit margins in the 2 to 3 percent range in recent years, but Sageworks estimates margins were a little stronger in the most recent trailing 12-month period, increasing to nearly 4 percent.

 

Choosing a profitable franchise

 

Now, how much money you can make profit from a franchise depends upon various factors. However, there are a few checklists you need to stick to to ensure that you get the best possible outcome. Like, the franchise which you are looking forward to choosing should appeal to the local customers, have a good and sound support system, goodwill and reputation.

It is also a wise idea to discuss with a lawyer who can help you with the prospects in a more transparent way keeping you on a safe path.

 

A few of the most profitable franchise businesses are:

  •  Couriers & Delivery

  • Pre-Schools

  •  Salon

  • Wraps and Rolls

  •  Gifting

  •  Ice creams

  •  Electric vehicle

  • Juice & Shakes

  •  Language Schools

  •  Pharmacy

 

“The three main items that have the potential for the biggest variability are going to be the labor costs, and some of that depends on where you’re located – the food costs and the rent structure,” Bickert says. “They have the biggest impact” on profitability, says Steve B who works with McDonald’s Franchises.

There runs a myth that opening a franchise business will cost you huge. It is completely incorrect. You can start a franchise business with lesser capital as well. Franchise business contributes a lot to our economic aspect plus creates jobs for many.

To summarise briefly, the idea of franchise business is superb citing the growth it is gaining. The best part is you have very well guided y the parent company in multiple aspects like marketing, accounting, sales, finance, advertising, inventory management, etc.

Now from the research and briefings you can choose your brand and enhance your entrepreneurial skills. as per your interest, location, investment capacity.

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