1851

If you've been curious about jumping into the world of franchising, you might be worried about the risk involved. To get some insight, here’s a breakdown of what drives the failure rate of franchises, according to data from the&nbsp;<a href="https://www.franchiseba.com/what-is-the-failure-rate-for-a-franchise/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=franchise-failure-rates-understanding-what-factors-determine-a-franchises-failure-or-success-2725347#:~:text=Studies%20in%20the%20market%20have,franchise%20before%20deciding%20to%20invest." target="_blank" rel="nofollow">Franchise Brokers Association</a>.&nbsp;<h3>The Complex World of Franchise Failures</h3>First of all, there's no one-size-fits-all answer to the question of what causes a franchise to fail. Unlike starting your own business from scratch, investing in a franchise involves a number of moving parts. And these moving parts can make it tough to nail down an exact failure rate.Depending on who you ask, you might hear numbers ranging from a whopping 50% flop rate to a more modest 20%. So, what gives?<h3>The Factors That Call the Shots</h3>When it comes to franchising, not all opportunities are created equal. Here are a few factors that might influence the success rate.&nbsp;Your Experience: There’s no doubt that having some prior experience in the business world is handy in franchising. But even if you're a newbie, many franchisors offer training and support to get you up to speed. What really matters is your commitment, your ability to roll with the punches, and your knack for connecting with customers.Franchisor Support: The support a franchisee receives from a franchisor can make a world of difference. This includes training, marketing assistance, and a team to answer all your questions. Picking a franchise with solid support can be a game-changer.Selected Industry:&nbsp;Not all industries weather economic storms the same way. Some, like food and home services, tend to ride out tough times better. Others, like retail and travel, might hit rough patches depending on what’s going on in the world. Knowing what's what in your chosen industry is key.Brand:&nbsp;Though it's not a guarantee for success, sometimes having a recognizable brand backing you up can help. People trust what they know, so joining a well-established franchise can give you a leg up. A good reputation can also make marketing easier.Market:&nbsp;Understanding local demand, competition and who your customers are can also make or break your franchise. It’s important to be in tune with your market and decide whether your business can thrive in it.&nbsp;<h3>Thriving (or Surviving) in Tough Times</h3>Franchising can be pretty resilient — even when the economy takes a hit. In fact, it can even work in the industry’s favor.In an&nbsp;<a href="https://1851franchise.com/yahoo-finance-1851-franchises-nick-powills-on-why-franchising-will-be-attractive-in-2024-2724576#stories">interview with Yahoo! Finance</a>, 1851 Publisher&nbsp;<a href="https://www.linkedin.com/in/powills/?utm_source=1851franchise.com&amp%3Butm_medium=article&amp%3Butm_campaign=yahoo-finance-1851-franchises-nick-powills-on-why-franchising-will-be-attractive-in-2024-2724576&utm_source=1851franchise.com&utm_medium=article&utm_campaign=franchise-failure-rates-understanding-what-factors-determine-a-franchises-failure-or-success-2725347" target="_blank" rel="nofollow">Nick Powills</a> noted that “the franchise industry tends to work opposite that of the economy. So when the economy goes down, franchising goes up.”&nbsp;And when the going gets tough, franchisors often step up their support game to help franchisees survive (and hopefully thrive) their challenging times.<h3>Franchising vs. Going Solo</h3>It’s clear that franchising has its perks, such as built-in support and a ready-made business model. But going it alone has its advantages too, like more freedom to do your own thing. As the person behind the business, success is ultimately defined and determined by you.&nbsp;<h3>The Bottom Line on Franchise Failure Rates</h3>The takeaway? Franchise failure rates are a mixed bag, influenced by many factors. But with research, determination and the right brand, a successful venture awaits.&nbsp;Every great franchisee had help buying a franchise. Want to learn more about how 1851 helps franchisees find the right franchise opportunity? Visit&nbsp;<a href="http://www.1851growthclub.com/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=franchise-failure-rates-understanding-what-factors-determine-a-franchises-failure-or-success-2725347" target="_blank" rel="nofollow">www.1851growthclub.com</a> and start your journey.

Franchise Failure Rates: Understanding What Factors Determine a Franchise’s Failure or Success

Franchise Failure Rates: What Causes a Franchise to Fail?

1851 Franchise

There’s no simple formula for franchise success, but there are certain factors that influence how well (or not) a venture might go. 

franchise-failure-rates-understanding-what-factors-determine-a-franchises-failure-or-success

Right at Home

Right at Home Marks 30 Years With Continued Franchise Growth

Right at Home Marks 30 Years With Continued Franchise Growth, Tech Advancements, and Strong System Engagement in First Half of 2025

right-at-home-franchise-growth-2025

KidStrong Franchising, LLC

Unlocking Superpowers: How KidStrong Is Building the Next Generation of Confident Kids — and Thriving Franchise Owners

kidstrong-franchise-confident-kids

Image of a kid growing up, developing with kidstrong, high fiving and smiling. 

How KidStrong has Become the Franchise Disrupting Child Development by Partnering with Purpose-Driven Franchise Owners 

kidstrong-franchise-opportunity-child-development

Picture of kids for franchise business Kidstrong which focuses on child development and fitness

KidStrong Is Pediatrician-Recommended for Raising Confident, Capable Kids and Families Can't Get Enough

kidstrong-child-development-program

Layne's Chicken Fingers

Layne's Chicken Fingers-QSR-Sandwich-Brand-Addition-June-2025

Why Sandwich Franchisees Are Expanding With Layne’s Chicken Fingers

laynes-chicken-fingers-franchise-sandwich-operator-expansion

Buying a Franchise Masterclass

 Franchise Opportunities

Get Support Buying a Franchise

How to Buy a Franchise White Paper

How to Buy a Franchise

How to Sell Franchises

How to Grow a Franchise

Find a Franchise Supplier

1851 Franchise Opportunities

Franchisor News

Franchisor Power Rankings

FranCamp Mastermind Summit

Franchise Development Website Builder

Franchise Resources

What ALEC-Laffer's Report Means for Franchising

Website Awards

Power Rankings

About 1851

Advertise on 1851

Contact 1851 Editorial

Terms of Use

1851 Login

GROWTH CLUB LOGIN

facebook

instagram

twitter

linkedin

youtube

Image of Donald Trump pointing with red stripes in the background

August 1 Tariff Deadline Is Said to Have ‘No Extensions’: What This Could Mean for Franchises

august-1-tariff-deadline-franchise-impact

What June’s Jobs Report Means for the Franchise Industry

what-junes-jobs-report-means-for-the-franchise-industry

Drone Delivery Takes Flight in QSR: The Future of Franchise Operations?

drone-delivery-takes-flight-in-qsr-the-future-of-franchise-operations

Chick-fil-A Tops Customer Satisfaction Rankings for 11th Year as Challenger Brands Gain Ground

chick-fil-a-tops-customer-satisfaction-rankings-for-11th-year-as-challenger-brands-gain-ground

Technomic Releases Annual Ranking of the Top 15 Fast-Food Chains in the U.S.

technomic-releases-annual-ranking-of-the-top-15-fast-food-chains-in-the-us

Hooters Leans Into Franchising With Closure of 30 Company-Owned Stores - Agg - 1851 Franchise

Hooters Leans Into Franchising With Closure of 30 Company-Owned Stores

hooters-franchise-model-company-owned-closures

Rising Jobless Claims Could Signal Challenges — and Opportunities — for Franchising

rising-jobless-claims-affect-franchising

The Ultimate Guide to Selling Franchises: How To Create a Strong Incentive

how-to-build-strong-incentives-to-attract-prospective-franchisees

How Vishal Juneja Turned a Family Tradition Into a Paris Baguette Franchise

How Vishal Juneja Turned a Family Tradition Into a Paris Baguette Franchise Built on Heart and Community

paris-baguette-franchise-rockaway-new-jersey-vishal-junjea

Franchisee spotlight graphic with photo of Ricki Oberoi and Layne's Chicken Fingers logo

Multi-Unit Wendy’s Operator Signs 12-Unit Deal With Layne’s Chicken Fingers

ricki-oberoi-laynes-chicken-fingers-growth

Franchisee spotlight graphic with photos of Danielle Rosemond & Usman Khan & TruBlue logo

Family Members of Local Physicians Bring TruBlue Franchise to North Central Nassau, Long Island: A Health Care-Inspired Approach to Aging in Place

family-brings-trublue-franchise-to-north-central-nassau

Top 25 Franchise Marketing Leaders: Kelsey McManemin — Vice President of Marketing, HTeaO

top-25-franchise-marketing-leaders-kelsey-mcmanemin-vice-president-of-marketing-hteao

Franchise Failure Rates: Understanding What Factors Determine a Franchise’s Failure or Success

MORE STORIES LIKE THIS