1851

When the year began, markets were enjoying all-time highs. Private equity investors were being aggressive in negotiations, as they had increasingly been over the past decade. Then came the coronavirus pandemic, which slowed and in many cases altogether shut down businesses across sectors and industries, and <a href="https://www.businessinsider.com/coronavirus-hits-private-equity-investments-in-hospitality-entertainment-2020-3?utm_source=1851franchise.com&utm_medium=article&utm_campaign=franchising-remains-a-safe-bet-for-private-equity-investments-post-covid-19-2712922" target="_blank" rel="nofollow">the private equity industry is no exception</a>.“Up until the coronavirus crisis, the market had been strong. There was a lot of capital out there, which was driving up valuations in addition to cheap financing. It got to the point where people were moving down to smaller, more emerging growth purchases because the big targets were being exhausted. It was an aggressive deal environment,” said Erik Herrmann, partner and head of <a href="http://www.capitalspring.com/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=franchising-remains-a-safe-bet-for-private-equity-investments-post-covid-19-2712922" target="_blank" rel="nofollow">CapitalSpring’s restaurant investment group</a>.Now, of course, everything has changed. It remains unclear how long many businesses will be forced to close their doors, and the economy continues to slide downward. However, while it’s not closing many deals right now, the franchise industry will likely remain attractive to private equity investors on the other side of this crisis.“What’s attractive about franchise business models to private equity firms is that they’re much less capital-intensive. If you have a model that’s sellable, meaning you can effectively sign up franchisees, then it’s something you can get exponential growth from with a minimal investment,” Herrmann said. “That’s a key driver of why people find the franchising industry to be attractive from a financial standpoint.”In addition to franchisors, private equity investors are likely to find franchisee-owned businesses attractive as well. According to Herrmann, “The average franchisee is growing in terms of unit count. If you have the ability to buy into a platform and embark on a series of acquisitions to create value, that’s also attractive from a private equity standpoint.”However, it will likely take a while for investment firms to start considering their next moves. Herrmann added, “Right now, most people are focused inwardly on their portfolios given the massive disruption we’ve seen across most industries. Any industry that isn’t deemed ‘essential’ is getting crushed. But with that being said, there are going to be interesting opportunities that grow out of this”These opportunities are still up in the air, given that nobody knows what’s around the corner and the fact that many companies are not expected to survive the coronavirus crisis. But Herrmann is predicting that the biggest changes that the private equity industry will see include risk pricing and financing costs massively resetting. He’s also anticipating some big deals on the other side of this despite the setbacks.“If you look at massive dislocations in the past, some major investments have come out on the other side,” said Herrmann. “People are generally looking at this and saying that if you have capital, there will be interesting opportunities that emerge after a few months when things settle. But I think it’s very much a case-by-case situation depending on the fund, their strategy and their sector. Some sectors are in for a longer recovery. It might be eight months or so before we get to normalcy in certain pockets of the economy.”In order for franchisors and franchisees to remain a safe bet for private equity firms on the other side of the crisis, Herrmann recommends closing any gaps and focusing on communication.“What we’ve seen is that there are varying levels of performance across the country. Some brands are slower to respond while there are others that are way ahead of this,” Herrmann said. “That’s the learning — responsiveness is different from concept to concept. It’s important to have tight alignment between franchisees and franchisors. That will determine how you optimize and survive on the other side of this thing.”

Franchising Remains a Safe Bet for Private Equity Investments Post-COVID-19

1851 Franchise

Erik Herrmann, partner and head of CapitalSpring’s restaurant investment group, tells 1851 Franchise why the franchising industry remains lucrative despite the economic crisis. 

franchising-remains-a-safe-bet-for-private-equity-investments-post-covid-19

Jollibee

What Jollibee Learned From 100+ Corporate Units Before Franchising in the U.S.

what-jollibee-learned-from-100-corporate-units-before-franchising-in-the-us

Wings and Rings

image of wings and rings franchise announcement of operating partner-program

Wings and Rings Launches Operating Partner Program to Reward Top Performers and Build Future Franchise Owners

operating-partner-program

Homewatch CareGivers

Image of Homewatch Caregivers franchise 2026 franchisee Conference in reno

Homewatch CareGivers Franchise Network Comes Together in Reno for 2026 Conference

homewatch-caregivers-conference-reno

Mister Sparky Electric

image of mister sparky franchise owner Michelle Glasson Levittown, Pennsylvania.

How This Mister Sparky Franchise Owner Is Building Opportunities for Women in the Skilled Trades

mister-sparky-franchise-owner-women-skilled-trades

Comfort Keepers

Photo of Comfort Keepers team member and senior completing craft project

Comfort Keepers® Opens 3 New In-Home Care Franchise Territories, Awards 6 More in Q1, and Earns Spots on Entrepreneur Franchise 500

q1-2026-growth

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

The Top 10 Low-Cost Franchises With High ROI 

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

Jersey Mike's Takes First Steps Towards Initial Public Offering

jersey-mikes-makes-first-steps-towards-ipo

Prince St. Pizza Partners With Dave’s Hot Chicken Franchisee for National Growth

prince-st-pizza-partners-with-daves-hot-chicken-franchisee-for-national-growth

FTC Settlement Puts New Focus on Franchise Disclosure Standards - 1851 Franchise

FTC Settlement Puts New Focus on Franchise Disclosure Standards

franchise-disclosure-violations-xponential-fitness-lawsuit-ftc

Applebee’s Franchisee Files for Bankruptcy as Dine Brands Moves to Acquire 53 Units - 1851 Franchise

Applebee’s Franchisee Files for Bankruptcy as Dine Brands Moves to Acquire 53 Units

applebees-franchisee-bankruptcy-neighborhood-restaurant-partners

Why Skilled Trades Are Emerging as the Economy’s Most AI-Resilient Careers

ai-skilled-trades-authority-brands

The&nbsp;<a href="https://www.franchise.org/">International Franchise Association</a> has released its annual&nbsp;<a href="https://www.franchise.org/franchising-economic-outlook/">Franchising Economic Outlook</a> report for 2026, painting the picture for a positive year of growth after notable economic turbulence in 2025.“The resilience of franchising has enabled our model to adapt, endure and thrive in the face of challenging macroeconomic headwinds,”&nbsp;<a href="https://www.linkedin.com/in/matthewhaller">Matt Haller</a>, IFA president and CEO, said in a release. "After a year of recalibration, franchising is better positioned to navigate an improving economic environment than independent businesses due to tax certainty, lower interest rates and investments in AI that will propel brand growth, franchisee unit-level economics and wage growth for the franchise workforce."The report features key industry projections for the year, including:<ul><li>The addition of over 12,000 new franchised businesses</li><li>The addition of over 150,000 jobs — meaning the industry will represent nearly 8.9 million jobs</li><li>An increase in total franchise GDP from $549.9 to $558.4 billion</li><li>An increase in multi-unit ownership as current single-unit franchisees pursue scale</li></ul>In addition to the strength of the industry as a whole, the organization highlighted segment-specific trends.&nbsp;<ul><li>This year, child services and commercial and residential services are recognized as top performers, expected to achieve a 3.2% year-over-year growth rate.</li><li>A focus on experiential dining, rather than value alone, may drive full-service restaurants to outpace quick-service brands in output growth.</li><li>Preventive health care has risen to be the third-largest franchised industry, and it represents strong opportunities as consumer awareness surrounding preventive health care persists.</li></ul>In terms of growth markets, Texas continues to lead the country as the fastest-growing state for franchising, followed by Florida, Georgia, Arizona and North Carolina. Michigan, Ohio and Utah have joined the top 10 this year thanks to their relative affordability and the potential they offer for market leadership and long-term growth.The outlook for 2026 is upbeat, and the drivers behind it look different than they did a few years ago. More brands are putting AI and automation to work in day-to-day operations, which helps franchisees move faster on basics like scheduling and inventory and stay tighter on margins.The growth in multi-unit ownership points to a shift in how people are approaching franchising. More operators are treating it like a scalable investment, focused on building an asset, not just buying themselves a job.As the year ramps up, IFA’s data suggests growth in 2026 will be driven by those leveraging the scale of the franchise model, embracing a tech-forward approach to business ownership, and staying agile in an evolving business landscape.Find the full 2026 Franchising Economic Outlook report&nbsp;<a href="https://www.franchise.org/franchising-economic-outlook/">here</a>.

Highlighting child services and commercial and residential services as top performers, the organization predicts the industry will add over 150,000 jobs and increase its GDP by billions this year.

IFA Releases 2026 Franchising Economic Outlook Report, Predicting Over 12,000 New Franchised Businesses This Year

2026-franchising-economic-outlook-report

<a href="https://princestreetpizza.com/">Prince St. Pizza</a> has partnered with a&nbsp;<a href="https://1851franchise.com/franchise-deep-dive-daves-hot-chicken-franchise-costs-fees-profit-and-data-2723529">Dave’s Hot Chicken</a> franchisee to support its national expansion,&nbsp;<a href="https://www.pizzamarketplace.com/news/prince-st-pizza-partners-with-daves-hot-chicken-franchisee-for-national-expansion/#:~:text=Prince%20St.%20Pizza%2C%20a%20New%20York%2Dbased%20pizzeria,the%20country%2C%20according%20to%20a%20press%20release.">Pizza Marketplace recently reported</a>. The New York-based brand has joined forces with&nbsp;<a href="https://www.linkedin.com/in/lawrencekourie/">Lawrence Kourie</a>, founder and largest franchisee of Dave’s Hot Chicken, to grow its footprint across the country. Kourie’s experience opening and operating locations in multiple markets will help the brand as it enters new territories."Lawrence has built and operated one of the fastest-expanding restaurant concepts in the country, but what stands out is his disciplined approach to growth and brand integrity," said&nbsp;<a href="https://www.linkedin.com/in/lawrence-longo-342856/?skipRedirect=true">Lawrence Longo</a>, CEO of Prince St. Pizza. "He understands how to develop a concept without losing what made it special in the first place, which is critical as we enter this next phase."The expansion will use Kourie’s existing infrastructure and operations to introduce Prince St. Pizza into new markets. Each location will aim to reflect the same experience as the brand’s original Nolita shop."I have spent years evaluating restaurant concepts, and it is rare to find one that delivers both a strong product and a clear identity," Kourie said. "What Prince St. has built is difficult to truly replicate. The focus now is on growing the brand in a way that preserves that foundation while introducing it to new communities."Kourie is a key operator within the Dave’s Hot Chicken system,&nbsp;<a href="https://1851franchise.com/daves-hot-chicken-sold-to-roark-capital-in-1-billion-deal-to-fuel-global-expansion-2729557#stories">which Roark Capital acquired in a $1 billion deal in 2025</a>. The partnership connects Prince St. Pizza to an operator with experience scaling a brand that has attracted major private equity investment.Read the full article&nbsp;<a href="https://www.pizzamarketplace.com/news/prince-st-pizza-partners-with-daves-hot-chicken-franchisee-for-national-expansion/#:~:text=Prince%20St.%20Pizza%2C%20a%20New%20York%2Dbased%20pizzeria,the%20country%2C%20according%20to%20a%20press%20release.">here</a>.Want to learn more about how 1851 helps franchisees find the right franchise opportunity? Visit&nbsp;<a href="http://www.1851growthclub.com">www.1851growthclub.com</a> and start your journey.

Prince St. Pizza is teaming up with a leading Dave’s Hot Chicken franchisee to expand nationwide, tapping proven operator experience to drive growth.

<a href="https://www.jerseymikes.com/franchise">Jersey Mike’s</a> is preparing for a potential initial public offering after confidentially filing an S-1 with the U.S. Securities and Exchange Commission,&nbsp;<a href="https://www.prnewswire.com/news-releases/jersey-mikes-announces-confidential-submission-of-draft-registration-statement-for-proposed-initial-public-offering-302746694.html">according to a recent press release</a>.&nbsp;The brand’s rapid expansion is a key driver behind this decision. Jersey Mike’s has grown from 2,387 locations at the start of 2023 to more than 3,200 stores in early 2026, positioning itself as a serious challenger to&nbsp;<a href="https://1851franchise.com/what-subway-reviews-reveal-about-the-brands-franchise-experience-2729934">Subway</a> in the sub sandwich category. This growth has been further accelerated by&nbsp;<a href="https://1851franchise.com/blackstone-acquires-majority-stake-in-jersey-mikes-signaling-ambitious-growth-plans-2727945">Blackstone's acquisition of a majority stake in 2024</a>.A major differentiator for&nbsp;<a href="https://1851franchise.com/franchise-deep-dive-jersey-mikes-franchise-costs-fees-profit-and-data-2720908">Jersey Mike’s is its strong unit-level performance</a>. The brand reports an average unit volume of about $1.4 million for mature stores, significantly higher than&nbsp;<a href="https://1851franchise.com/franchise-deep-dive-subway-franchise-costs-fees-profit-and-data-2722471">Subway’s estimated $500,000 AUV</a>.&nbsp;While IPO activity was relatively quiet in 2025, the successful public debut of&nbsp;<a href="https://ir.br.coffee/news-releases/news-release-details/black-rock-coffee-bar-announces-closing-initial-public-offering">Black Rock Coffee Bar</a> has raised optimism that more brands could follow. At the same time, several restaurant companies, such as&nbsp;<a href="https://1851franchise.com/dennys-franchise-outlook-triartisan-acquisition-2731234">Denny’s</a>, have moved in the opposite direction, going private or exploring alternatives to avoid public-market pressures.Read the full press release&nbsp;<a href="https://www.prnewswire.com/news-releases/jersey-mikes-announces-confidential-submission-of-draft-registration-statement-for-proposed-initial-public-offering-302746694.html">here</a>.&nbsp;Want to learn more about how 1851 helps franchisees find the right franchise opportunity? Visit&nbsp;<a href="http://www.1851growthclub.com">www.1851growthclub.com</a> and start your journey.

With more than 3,200 locations and backing from Blackstone, Jersey Mike’s positions itself as a top contender for investor interest amid shifting restaurant market dynamics.

Private equity firm&nbsp;<a href="https://skylineinv.com/">Skyline Investors</a> has acquired rent-to-own franchisor&nbsp;<a href="https://buddysfranchising.com/">Buddy’s Home Furnishings</a> in a deal that signals continued investor confidence in franchise-based retail models, according to a&nbsp;<a href="https://www.retailtouchpoints.com/features/mergers-and-acquisitions/rent-to-own-franchisor-buddys-home-furnishings-purchased-by-private-equity-firm">report from Retail TouchPoints</a>. The transaction, announced Feb. 4, brings new ownership to a system of more than 220 locations across 18 states and Guam, positioning Buddy’s for its next phase of growth within the franchising sector.Financial terms of the deal were not disclosed, but the acquisition reflects a broader trend of private equity firms targeting established franchise brands with recurring revenue and strong unit-level performance. For Buddy’s, which specializes in furniture, electronics and appliances, the partnership is intended to strengthen its operational platform and expand long-term opportunities for franchisees.“This is an exciting new chapter for Buddy’s,” CEO&nbsp;<a href="https://www.linkedin.com/in/michael-bennett-cfe-a9309538/">Michael Bennett</a> said in a statement. “Skyline brings a collaborative mindset that our franchisees and customers will feel immediately. We’re not just changing ownership; we’re gaining committed partners who understand our business, value our franchise network and are ready to invest in our collective success.”Skyline structured the investment alongside&nbsp;<a href="https://www.linkedin.com/in/jeffrey-jaeger-bb48b43/">Jeffrey Jaeger</a> and&nbsp;<a href="https://www.linkedin.com/in/scott-alter-7aa99311/">Scott Alter</a>, co-founders and principals of affordable housing developer&nbsp;<a href="https://standard-communities.com/">Standard Communities</a>. Their involvement adds financial and strategic expertise aimed at supporting capital formation, balance sheet management and disciplined expansion.For franchise operators, the deal offers potential benefits in the form of increased corporate resources, enhanced systems and renewed investment in technology and infrastructure. Private equity-backed franchisors often prioritize scalability, data-driven decision-making and operational consistency, all of which can influence franchisee performance and long-term brand stability.Skyline brings prior experience in the rent-to-own space, including investments in&nbsp;<a href="https://www.gomajik.com/">Majik Rent-to-Own</a>, which may help accelerate Buddy’s development efforts and refine its franchise support model. Company leaders say the firm’s approach is centered on partnership rather than short-term returns.“Buddy’s represents exactly the type of platform opportunity we’re built to support,”&nbsp;<a href="https://www.linkedin.com/in/kevintom/">Kevin Tom</a>, founder and managing partner at Skyline Investors, said in a statement. “With Buddy’s proven brand and strong franchise network, there’s a clear runway for growth.”As private equity continues to expand its footprint in franchising, deals like this highlight the sector’s appeal to institutional investors. For Buddy’s franchisees, the acquisition marks a transition that could shape everything from marketing strategies to multi-unit development in the years ahead, reinforcing the brand’s position in the competitive rent-to-own marketplace.Read the original article&nbsp;<a href="https://www.retailtouchpoints.com/features/mergers-and-acquisitions/rent-to-own-franchisor-buddys-home-furnishings-purchased-by-private-equity-firm">here</a>.Want to learn more about how 1851 helps franchisees find the right franchise opportunity? Visit&nbsp;<a href="http://www.1851growthclub.com">www.1851growthclub.com</a> and start your journey.

Buddy's Home Furnishings Acquisition - Skyline Investors - 1851 Franchise

Skyline Investors’ acquisition highlights how rent-to-own operators with dense unit networks and steady demand are drawing long-term capital and operational playbooks.

Buddy’s Home Furnishings Deal Signals More Private Equity Interest in Franchise Retail

buddys-home-furnishings-acquisition-skyline-investors-private-equity

How much can franchisees make? It’s a question many prospective owners ask before investing in a franchise. While earnings tend to be driven by variables such as industry, location and general management skills, a proper understanding of the key factors driving profitability can help franchise owners develop expectations that are realistic.&nbsp;Multi-unit franchisee&nbsp;<a href="https://www.linkedin.com/in/mangesh-patel-9368569/">Mangesh Patel</a>, who’s readying the launch of six&nbsp;<a href="https://www.beefobradysfranchise.com/">Beef ‘O’ Brady’s</a> restaurant locations in the Macon, Georgia area, shares insights from his franchising experience.<h2>Understanding Franchise Income</h2>Keeping operational costs in check can have a major impact on overall earnings. Taking a proactive approach to expenses such as food and labor, as well as payroll and scheduling, can help align actual franchise income with general expectations for the business.“I just had a meeting with a couple of people, and they said, ‘You talked about a 25% profit margin, but I’m only doing 12%.’ So, I looked at the figures they sent me,” Patel said. “Their&nbsp;<a href="https://1851franchise.com/calculate-restaurant-franchise-profit-2730476">restaurant</a> food cost was running at 37%, which should be around 30%. The national average is about 32%. If I do things correctly, my average food cost needs to be at or below 30%. And payroll should run around 18%. But many people run 25 to 28%.”So,&nbsp;<a href="https://1851franchise.com/unraveling-franchise-earnings-how-much-can-you-really-make-2723935">how much can franchisees make</a>? Here are five areas to consider.<h2>Practical Tips for Prospective Franchisees</h2><ol><li>Control Costs From Day One:&nbsp;It’s important to monitor payroll, food and supply costs closely. Overstaffing and inefficiencies can quickly reduce profits.</li><li>Plan For The Opening Surge:&nbsp;Traffic within the first few months of opening is likely to be higher. It’s important to adjust staffing and inventory accordingly, and pay close attention to how those levels change as time goes on.</li><li>Invest In Training:&nbsp;Properly trained workers can help reduce waste and improve overall service, which has a direct effect on net income.</li><li>Understand Your Market:&nbsp;Each market is unique and revenue potential will vary depending upon location, demographics and competition.</li><li>Track Metrics Regularly:&nbsp;Food cost percentages, labor ratios and weekly sales data act as key indicators operations may need to be adjusted.</li></ol><h2>What Profitability Really Comes Down To</h2>Patel notes that if franchise owners manage labor and costs properly, it’s not impossible to achieve strong cash flow even in the first year, bucking some franchising trends.So,&nbsp;<a href="https://1851franchise.com/how-much-can-you-make-as-a-franchise-owner-2724761">how much can franchisees make</a>? While results tend to vary, careful planning, disciplined operations and a proactive approach to assessing initial costs are essential. But by grasping and guiding the elements that drive franchise profitability, franchise owners can maximize overall business earnings, scaling a business that’s sustainable financially over the long term.Want to learn more about franchise opportunities on 1851 Franchise? Be sure to visit our&nbsp;<a href="https://1851franchise.com/power-rankings">Power Rankings</a> to read more on brands making moves.

How much can franchisees make? This guide explains what drives franchise earnings and how to manage costs, with expert tips from multi-unit owner Mangesh Patel on maximizing your franchise income.

How Much Can Franchisees Make? A Guide for Prospective Franchise Owners

how-much-can-franchisees-make-a-guide-expert-tips

Big O Tires Franchise Costs, Fees, Profit and Data for 2026

Franchise Opportunity Deep Dive: Big O Tires is a full-service auto care franchise offering tires, brake repair, alignments, oil changes and preventive maintenance under a nationally recognized brand.

franchise-deep-dive-big-o-tires-franchise-costs-fees-profit-and-data

Franchise Opportunity Deep Dive: A fast-casual restaurant brand serving made-from-scratch sandwiches, salads, soups and pizzas rooted in Southern hospitality.


Newk’s Eatery Franchise Costs, Fees, Profit and Data for 2026

newks-eatery-franchise-costs-fees-profit

Visiting Angels Franchise Costs, Fees, Profit and Data for 2026

Franchise Opportunity Deep Dive: Visiting Angels is a senior home care franchise focused on in-home support for seniors and individuals with disabilities.

visiting-angels-franchise-costs-fees-profit

BrightStar Care Franchise Costs, Fees, Profit and Data for 2026

Franchise Opportunity Deep Dive: BrightStar Care is a home health care franchise that provides both medical and non-medical services.

franchise-deep-dive-brightstar-cares-franchise-costs-fees-profit-and-data

Beef 'O' Brady's Franchise Costs, Fees, Profit and Data for 2026

Franchise Opportunity Deep Dive: Beef ‘O’ Brady’s is a family sports pub concept built around community, casual dining and lifelong local loyalty.

Franchising Remains a Safe Bet for Private Equity Investments Post-COVID-19

MORE STORIES LIKE THIS