Establishing Franchise Sales and Development Budgets

Franchise Update Media has been researching franchise lead generation and franchise recruitment processes for more than a decade. An annual in-depth online survey queries franchise development professionals about a number of issues related to their lead generation and recruitment strategies. The results are presented each year in the Annual Franchise Development Report (AFDR).

The AFDR is a valuable resource that can provide crucial insights into franchise development, lead generation, and recruitment best practices. It’s the kind of information that can help brands assess what they are doing right and what needs improvement.

The annual project seeks to identify what’s new and innovative in franchise lead generation, recognize the methods and approaches yielding the best results, and gain insights into franchisors’ perspectives on current and future business performance.

Survey participants were franchisors who completed an in-depth questionnaire online. Responses were aggregated and analyzed to produce a detailed view into the recruitment and development practices, budgets, spending allocations, and strategies of a wide cross-section of franchisors. The data, along with accompanying commentary and analysis, provided the basis for the 2025 AFDR.

The in-depth report features results from more than 110 organizations actively expanding their franchise systems. The thoroughly researched report spotlights the latest trends and reveals various franchise lead-generation and sales trends. The AFDR represents companies totaling more than 50,000 franchise units and 42 industry categories.

Franchise Update Media creates this report annually and shares its findings with franchise development teams to give them an edge in their lead generation and recruitment efforts.

What months do franchises plan their development budgets?

Now that we have reached Q4, we are entering the time of year when most development teams set their franchise sales goals and budget for 2026. Last year, Franchise Update asked frandev executives about the months they worked on those plans for 2025, and 80 percent said either October (35 percent) or November (45 percent).

We also asked the same question to franchises that responded that they were exceeding, below, or on target with their development goals. Thirty-three percent of the teams that said they were exceeding their goals said they set their budgets in November. An even 22 percent said they set their budgets in either September, October, or December.

Franchises that said they were on target or below their development goals seemed to get a slower start and share similar timelines. Only five percent of these two groups set their budgets in September. They both had the highest percentage of responses in November, with those who were below their goals being 48 percent, and those who were on target at 45 percent. Both groups set their budgets in October and November at a much higher rate than those who were exceeding their goals, and at a lower rate for the months of September and December.

Franchise Update posed the same question to franchises based on their industry sector: food, retail food, retail (non-food), service (brick and mortar), and service (non-brick and mortar). Nearly every group had the highest percentage of setting their budgets in November, led by retail food at 71 percent. The lone exception was service franchises (non-brick and mortar), with 53 percent setting their budgets in October.

The AFDR further broke down that question by franchise financial investment level. Most groups set their budgets in November, as two-thirds of franchises with the lowest investment level ($25,000 - $50,000) establish their budget during that month. The outlier was with half of the franchises with investment levels of $100,000 to $250,000, setting their budgets in October.

Finally, we analyzed the response to the question based on the size of the franchise. Most said they set their budgets in November, but there were several major outliers. Every one of the largest franchises in the study (1,001 to 2,500 units) said they establish their budget in October. Seventy-five percent of franchises with 251 to 500 units also indicated they set their budget in October. Franchises with 501 to 1,000 units evenly split planning their budgets in the months of October, November, or December.

For more information about the 2025 AFDR and how you can purchase the report, please scan the QR code below or click afdr.franchiseupdate.com/.