FranNet Releases Franchise Success Rate Statistics

Detailed Survey Shows 91% Success Rate for Franchises, 42% Higher Than Typical Small Businesses

LOUISVILLE, KY--(Marketwire - May 15, 2012) - FranNet, a national network of franchise consultants that helps aspiring entrepreneurs achieve franchise ownership, has released a detailed survey of the success and failure rates of franchise businesses.

The company conducted a detailed survey of 1,260 franchises it helped open from 2006 to 2010. The survey showed that 91.2 percent of the franchises FranNet helped open were still in business after two years.

This number contrasts sharply with data from a special tabulation by the Bureau of the Census produced for the Office of Advocacy of the U.S. Small Business Administration a decade ago, the most accurate and recent data available on small business success rates.

The U.S. Census data showed that only 64 percent of small businesses survived the first two years of operation, and only half were still in business after four years. By contrast, during the timeframe when FranNet studied small businesses, 85 percent of the businesses that it helped open were still in operation through five years.

FranNet's survey is important because it shows that franchised businesses enjoy success 42 percent more often than small businesses. Viewed differently, the U.S. Census report showed that 36 percent of small businesses failed within two years, compared to less than 9 percent of franchised businesses placed by FranNet.

The FranNet survey covered the majority of the recent recession -- one of the most difficult business climates in the last 50 years.

"Accurate small business and franchise success rate data are very difficult to come by," said Jania Bailey, President and COO of FranNet. "It is often speculated that franchises are less risky and have a higher success rate than most small businesses, and we are excited about the implications our survey brings to light."

About FranNet

FranNet, headquartered in Louisville, Ky., is a private franchised business consulting company that for 25 years has helped professionals open their own franchise businesses. FranNet consultants work individually with clients and use a specific profiling and consultative process to determine a business model unique to each person. Its services are free. For more information, visit www.frannet.com.

Media Contact:

John Blair
(502) 753-2380, ext. 227

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