Franchising is so popular because it allows entrepreneur to own and operate their
own business, profit from the use of an established brand name, and benefit from
a proven system of operations.
Franchise companies also provide guidance and consultation
on personnel, training, audits and controls, and share in the success of an established
marketing plan.
Important Franchise Facts
Franchise operations in the United States account for 42% of all retails
sales.
According to the US Department of Commerce from 1971
to 1987, less than 5% of the franchise businesses were closed each year.
Arthur Anderson & Company found in 1991, almost 86% of all
franchises opened in the previous five years was still under the same ownership
and 97% were still in business.
Conversely, according to
statistics from the US Small Business Administration from 1978 to 1988, 62%
of all non-franchised businesses closed within the first six years due to
failure, bankruptcy, retirement, or other reasons.
On average
the percentage of independent tax preparation businesses still in business
after 1 year is 62%, while for tax franchises is 97%.
After
being in business for 5 years, only 23% of independent tax businesses are still
in operation, while 92% of tax franchises are successfully operating.
IRS predicts the number of individuals filing income tax returns
will grow 1.5% a year up to the year 2008