1851

When choosing a franchise concept, prospects tend to ask one question first: what is my potential ROI (return on investment)? With thousands of different concepts out there, each with different levels of profitability, calculating the ROI of a franchise is complicated. Here are some of the basic points to consider:<ul><li>Potential earnings: Within the brand’s <a href="https://1851franchise.com/what-is-an-fdd-2705192">FDD (franchise disclosure document</a>), <a href="https://1851franchise.com/top-5-things-to-know-about-item-19-2703545">Item 19</a> offers performance information on existing franchised locations. The Item 19 is not a guarantee of how well the business will do, and franchisors are not required to provide one, but when available it offers statistical information that can help determine ROI.&nbsp;</li><li>Initial investment: The FDD also provides an approximation of the initial investment (<a href="https://1851franchise.com/the-most-important-items-in-an-fdd-item-7---initial-costs-2712071">Item 7</a>). The upfront costs obviously play a major role in the potential for ROI, and should be weighed carefully against a prospect’s available capital and potential financing. For those looking for low cost opportunities, mobile or home-based concepts tend to have <a href="https://1851franchise.com/10-low-cost-franchises-you-can-start-from-home-2713097">a much lower initial investment</a> as there are no construction or rent costs.</li><li>Franchisee and royalty fees: Most franchise concepts require initial and continuing fees paid to the franchisor, which can be found in <a href="https://1851franchise.com/initial-and-ongoing-costs-fdd-items-5-7-2703065">Items 5 and 6</a> of the FDD. These fees will also have an impact on the potential ROI.</li></ul>Dozens of variables combine to determine a franchise’s ROI, and many depend on the individual prospective owner/operator. To understand these factors, enlist the help of a <a href="https://1851franchise.com/how-a-franchise-consultant-can-help-put-you-on-the-path-to-success-2430">knowledgeable franchise consultant</a>, accountant or another financial advisor. These experts will evaluate the prospect’s specific situation and create a reasonable projection that details the return on investment the owner can expect to achieve.

What Is The Most Profitable Franchise?

1851 Franchise

Here are some things to keep in mind when looking for the most profitable franchise opportunity.

Which Franchise Should You Buy To Get the Best ROI?

which-franchise-should-you-buy-to-get-the-best-roi

Lawn Doctor

Design with photo of John Perry and Lawn Doctor logo

How a 20-Year Industry Veteran Tripled His Sales With a Lawn Doctor Franchise

lawn-doctor-franchise-success-story-john-perry

Fitness Premier

The Secret to Fitness Franchise Success? It's Not Just the Workouts

fitness-premier-franchise-marketing-support

Fresh Coat

Photo of Fresh Coat vehicle with ladders on top

The Rise of Home Improvement Franchises: Why Now Is the Time to Invest

why-invest-home-improvement-franchise-fresh-coat

HomeTeam Inspection Service

Photo of HomeTeam inspector in red polo and khaki pants, walking by branded vehicle

Real Estate Today: Behind the Drywall: The Truth About Home Inspections

purpose-of-home-inspection

Dog Training Elite

Dog Training Elite Franchise - DTE - National Service Dog Month - 1851 Franchise

Celebrating Service Dogs: Why Proper Training Changes Lives — And How Dog Training Elite Is Leading the Way

dog-training-elite-national-service-dog-month

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

Design with American and Federal Reserve flags against light blue background

Federal Reserve Expected To Cut Rates by Quarter Point, a Move That Could Boost Franchise Growth

fed-rate-cut-boosts-franchise-growth

Potbelly to be Acquired by RaceTrac in $566 Million Deal 

racetrac-acquires-potbelly-in-566-million-deal

Health Care Hiring Slowdown Highlights In-Home Care Franchise Opportunities - 1851 Franchise Agg

Health Care Hiring Slowdown Highlights In-Home Care Franchise Opportunities 

health-care-hiring-slowdown-in-home-care-franchise-opportunities

Caribou Coffee Names Scott Kennedy CEO, Eyes Continued Growth

caribou-coffee-names-scott-kennedy-ceo-eyes-continued-growth

McDonald’s Launches New Extra Value Meals as Consumer Demand for Value Continues to Climb

mcdonalds-launches-extra-value-meals

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

Friendly’s Parent Company Acquired by Multi-Unit Franchisee as More Owners Take the Lead in Brand Acquisitions 

friendlys-parent-company-acquired-by-multi-unit-franchisee-as-more-owners-take-the-lead-in-brand-acquisitions

Hely and Hiral Patel Bring Their Longtime Dream to Life With The Brass Tap

brass-tap-franchise-pasadena-maryland-hely-hiral-patel

1851 Keyword - The Secret To Succeeding With a Part-Time Franchise Is Picking the Right Model

The Secret To Succeeding With a Part-Time Franchise Is Picking the Right Model

part-time-franchises-picking-the-right-model

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

DevHub - Meet the Supplier - 1851 Franchise

DevHub: Scalable Digital Marketing for Franchises and Multi-Location Brands

devhub-meet-the-supplier

1851 Franchise Deep Dive graphic with Sparkle Squad logo

Sparkle Squad Franchise Costs, Fees, Profit and Data for 2025

franchise-deep-dive-sparkle-squad-franchise-costs-fees-profit-and-data

Design with school-aged child standing on pencil with text "Education Franchises" and "<$500K"

Top Education Franchises Under $500K To Explore in 2025

top-education-franchises-under-500k

Which Franchise Should You Buy To Get the Best ROI?

MORE STORIES LIKE THIS