Why a Service Franchise is Perfect for First-Time Franchisees

One of the first choices first-time franchisees have to make is what type of business they want to get into. With so many different options, it can be a tough decision.

Service franchises, or businesses that provide a service to their customers rather than selling them a product, can be a great opportunity for those looking to get started. These can include brands in categories such as handyman, lawn maintenance, pest control, child care, travel agents, automotive-related services and interior design – just to name a few. 

There are several reasons that service franchises can be a smart option for first-timers. Here are a few to consider. 

The Demand

Service franchises offer first-time franchisees the opportunity to be a part of an already booming market. Many of the types of services offered by these franchises are regularly needed by consumers, making it a fairly recession/pandemic-proof industry. 

Home services, in particular, saw a huge increase in sales during the pandemic. The industry is now expected to grow by $4.7 billion worldwide between 2021 and 2025. 

“Home service workers remain to be the essential workers that are needed, and will always be needed, across the country,” said Ryan Carpenter, brand president of Plumbing Paramedics. “There is a built-in demand for our services that isn’t going away.” 

Lower Startup Costs

In many cases, service franchises do not require a brick-and-mortar location. This means starting costs tend to be lower. In turn, lower startup costs allow for new franchisees to become profitable quicker.

Michael Chapman of Mold Medics, for example, signed a franchise agreement in March of 2021. Since then, he has been hitting milestone after milestone. “We set out to hit a specific monthly revenue goal, which I thought was unattainable,” he said, adding that he went on to blow that number out of the water. 

Meanwhile, Kristin Humphrey, who opened a Home Clean Heroes* franchise in West Houston this March, noted that the franchise’s relatively low investment costs allowed her to fulfill her dream of being her own boss. 

“Home Clean Heroes is one of the more affordable options for franchising,” Humphrey said. “If somebody is wanting to get into a first-time business, this is a lower cost of entry that can allow them that opportunity.”

Humphrey also said that the franchise is cost-friendly because costs for inventory and labor costs at the start are pretty low. 

Ability to Scale Easier

Because the service business model has a shorter timespan from signing to opening, they can typically scale quicker. A retail or foodservice franchise can take longer to open. This can be a good opportunity for a first-time franchisee who is looking to hit the ground running. 

Additionally, many service franchises require just more transportation and equipment in order to expand, as opposed to a whole other store. It is easier to grow and reach more customers that way. 

For example, at TruBlue Total House Care, a home maintenance franchise, low startup costs and a simplified operational model – which requires no brick-and-mortar location – is a major selling point for incoming franchise owners. 

“We are a high-margin business that requires a very low cost of materials,” said Sean Fitzgerald, TruBlue’s president. “When you have low cost of operations monthly, with a high demand and high margins, that's a great formula for success. Every location is fully scalable — there’s no limit to the amount of in-home services a franchise owner can provide.”

Appeal to a Broad Demographic

Service franchises can also appeal to a broader demographic than retail franchises since a wide variety of people need certain services.

Chris Seman, President of Strategic Franchising Systems, a franchise development company, noted that “the Baby Boomers have always been a do-it-for-me generation, and now they need these services more than ever, while Millennials and Gen Z have also traditionally hired out for the services they don’t want to do.”