Multi-Unit Franchisee Magazine Issue III, 2013 | Page 11

Services Stats By FRANdata

Service Brands by the Numbers

E

ach year we ask FRANdata for the numbers on franchised service brands, highlighting trends, growth/
shrinkage, and brands on the move. Here’s what
they found.

Services by the unit

In 2000, more than 400 franchised service brands were operating in the U.S. By the end of last year, that number had tripled
to 1,246, with brands operating in 14 industries in almost 100
sectors. Between 2000 and 2012, the number of new service
brands on the scene peaked at 94 in 2006, then declined back
to levels seen at the start of the decade.

Our previous estimate of 2011 unit activity was too conservative. With confirmed data, we now know that the number
of franchised units continued to increase every year between
2000 and 2010, before declining in 2011. Unit growth slowed
to 3% in 2008, dropping from 7% the previous year. In 2010,
the number of franchised units increased at even slower 2%,
then dropped by an estimated 4% in 2011.

Services by sector

From 2000 through 2011, service brands increased their
number of franchised units at a CAGR of 5%; decreasing to
3% for the more recent 2005 through 2011 period. Over the
period ending in 2011, the computer repair and security sectors grew fastest, as measured by number of franchised units.
The bath and bedding, pet-related, and business consulting
sectors ranked among the ten fastest-growing services sectors in both periods.

Who’s growing

As of last year, The Mutual Fund Store was the fastest-growing service brand on a unit growth percentage basis between
2000 and 2011, growing from a single franchised unit to 52,
after peaking at 58 in 2008. Along with The Interface Financial Group, two financial services brands are in in the top ten.

However, neither of these brands was among the ten fastest-growing concepts from 2005 through 2011; in the past 6
years, child-related and pet-related service brands grew their
franchised units at a faster pace.

When reviewing different growth periods through 2011
(from 2000, from 2005, and from 2009), it is interesting to
note that a total of eight child-related brands made the top ten
in each period, followed by five beauty-related brands. This
was driven by children’s educational program concepts such
as Drama Kids or The Learning Experience, and hair care
brands such as Sola Salon Studios or Knockouts.
Services by size

In terms of franchised unit numbers, maintenance and business-related services are the largest service sector brands. As
of 2011, Jan-Pro (9,010 units), Jani-King (8,948), and Jackson
Hewitt Tax Services (5,222) led the pack. However, of the ten
largest services brands, only three managed to grow franchised
units between 2009 and 2011: Liberty Tax grew at a CAGR of
11%, followed by Great Clips at 5%, and H&R Block at 4%.

Multi-Unit Franchisee Is s u e III, 2013



9