The Pros and Cons of Owning a Service Franchise

When choosing the type of business to franchise with, there are two categories that brands typically fall into: a “service franchise” or a “retail franchise.” 

Many opportunities fall under the service franchise umbrella, such as handyman, lawn maintenance, pest control, child care, automotive-related services, interior design and more.

Owning a service franchise comes with its own unique rewards and challenges. Here’s a look into those pros and cons, according to industry insiders. 

Pros 

One of the biggest pros of owning a service franchise is that they are relatively economy-resistant. 

“During COVID, those two years each year we actually had a 25% growth, which a lot of small businesses did not, or even suffered,” said Mosquito Joe* of Southeastern NC Owner Anne Johnson. “Homes are always there; mosquitoes are always there.”

In fact, the home services industry actually became a $506 billion market after seeing major growth during the pandemic. By 2026, the industry is expected to grow to more than $1,219 billion. 

Because service franchises really don’t require a storefront, there is the advantage of those costs being much lower. 

“You don’t necessarily need to have a brick-and-mortar location,” Johnson said, adding that she and her customer service reps can all work from home while the technicians and field service manager are on the ground. 

Similarly, Johnson noted that there is not a lot of inventory required. “We're able to gauge [product need] based on the number of sprays and our customers — things like that. So that's really big. You're not walking in and buying this enormous product.”

Expanding service franchises can also be a quicker process than with other types of businesses.  “When we needed to expand that first year, everything was right there for us,” said Johnson. “I needed a van, and about a week later, it was delivered to my door.”

Service franchises also provide the unique opportunity to get to know customers personally, especially when employees regularly visit consumers' homes. “These customers become our family,” said Johnson. 

Cons

Corey Elias, the founder of Franchise Captain, said that, with a lower barrier to entry, it is also easier for new competitors to enter the service franchise market. 

When she started six years ago, Johnson noted that there was not much competition in the rural areas she was servicing, but as time progressed, more came in. However, they are mostly mom-and-pop-type businesses that don’t have the same franchisor-backed support and marketing tools that businesses like Mosquito Joe have. 

Additionally, service franchises tend not to be as visible or “glamorous” as other businesses, making marketing very important. “You lack the high visibility that many brick and mortar locations have, so you need to rely on more creative marketing to let people know you exist,” Elias said.