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The Franchise 500's Top 10
Posted 1/ 15 10 at 10:27 AM | Franchises
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A A AWhat does it take to get to the top of Entrepreneur Magazine's annual Franchise 500 ranking? The 10 franchise systems that follow have captured their place in the spotlight for their outstanding quality, flexibility and strategic improvements. And it helps to have won the hearts of both franchisees and the public. Click through for an overview of the highlights.
No. 10: Denny's
Denny's is an American institution -- which is good and bad. It's got unbelievable brand recognition, but it's also saddled with decades of baggage, including a highly publicized discrimination lawsuit in the 1990s, a reputation as a hangout for late-night hoodlums and a bastion of bad food. But in 2009, Denny's began a hard and fast climb into the 21st century with one Super Bowl commercial, offering a free breakfast for anyone willing to wait. Two million people went in.
Did you know: Denny's started out in 1953 as Danny's Donuts, becoming Denny's in 1959.
Number of franchises: 1,374
Franchising since: 1984
Startup costs: $1,125,609 - $2,396,419
2010 rank: #17
No. 9: Subway
Last April, Subway threw its hat into a crowded ring by introducing a full line of breakfast sandwiches nationally. It was a risk for the hero-slinging behemoth, but according to the company, which does not release sales figures, the initiative exceeded expectations and boosted per unit averages. That has helped keep the 34,000-unit restaurant expanding. It added 2,000 stores in 2010, including 800 new locations outside the United States, and it expects to open 2,100 sites this year.
Did you know: Subway claims there are more than 2 million sandwich varieties available in its stores.
Number of franchises: 33,188
Franchising since: 1974
Startup costs: $84,300 - $258,300
2010 rank: #1
No. 8: Servpro
One good thing came out of the catastrophic floods that hit downtown Nashville, Tenn., last May: It gave Servpro a chance to show its home state what it's all about. The cleanup and restoration company, which specializes in smoke, fire, water and mold damage, mobilized its disaster recovery team and brought almost 700 crews from its 1,600 locations to Music City to help clean up the mess. It showed just how strong a national franchise can be in an industry dominated by small independent operations.
Did you know: After 40 years in business, Servpro opened its first international location in 2010.
Number of franchises: 1,526
Franchising since: 1969
Startup costs: $127,300 - $174,700
2010 rank: #9
No. 7: Vanguard Cleaning Systems
Vanguard Cleaning Systems is in the Top 10 -- and its competitors are not -- because its quality and customer service are rare in the cleaning biz. Instead of rushing to put franchisees on the streets, Vanguard has taken care to select the right master franchisees and emphasize training. "Businesses look to companies like ours because of our training, customer support and quality," says Mark Heisten, vice president for business development.
No. 6: Days Inn
The old chestnut in the hospitality industry is that hotels are the first to feel a recession and the last to recover. This is demonstrably true. So Days Inn, one of Wyndham Hotel Group's 13 brands and the largest economy hotel chain in the world (based on number of rooms), did what any company in fear for its profit margin would do when tough times struck. It tried to save every penny it could.
No. 5: Supercuts
Before the Great Recession hit, Supercuts' growth pattern mirrored pretty much everyone else's -- wherever a shopping plaza was going up in a new market, it was there. But as construction projects dried up around the country, Supercuts began to rethink that strategy. The company will add 100 units nationally this year, and expectations are for double that in 2012.
Did you know: A Supercuts franchisee in Houston set a new Guinness world record in 2009 by giving 349 haircuts in 24 hours.
Number of franchises: 1,035
Franchising since: 1979
Startup costs: $112,550 - $243,200
2010 rank: #5
No. 4: 7-Eleven Inc.
It's not that 7-Eleven isn't picky about its locations -- it pays plenty of attention to demographics, site selection and other basic metrics of franchising. It's more that it's adaptable, and during the past couple of years it has become like the yoga-master of franchising. Want to convert a mom-and-pop convenience store to a 7-Eleven? Need to squeeze a small convenience store onto a college campus or airport? Own a gas station but don't have the cash or experience to run the convenience store? 7-Eleven can help.
Did you know: A new 7-11 opens every 6.5 hours.
Number of franchises: 37,039
Franchising since: 1964
Startup costs: $30,800 - $604,500
2010 rank: #3
No. 3: McDonald's
You probably haven't noticed many Golden Arches going up around the country--the fast-food empire has more or less hit its North American saturation point, adding about 100 locations to its existing stock of 13,894 in 2010. But McDonald's has managed to stay dynamic (though it is putting up new stores in India and China, which is expected to open 600 new Mickey Ds by 2013). The focus at home is on improving quality and customer experience.
Number of franchises: 26,209
Franchising since: 1955
Startup costs: $1,057,200 - $1,885,000
2010 rank: #2
No. 2: ampm
Ampm has been pushing hot dogs and Snickers bars to U.S. travelers for more than 30 years, but the brand may not ring a bell. That's because for most of that time, ampm was only found in five western states, as the convenience brand of the Arco gas company. But in 2006, BP, which absorbed Arco in 2000, decided that the popular convenience store chain was ready to go national. Since then, BP has steadily sold off its BP Connect and other gas-station convenience stores, converting them to ampm franchises.
Did you know: In 2010, ampm launched a "secret menu" of snack bar recipes available only via Facebook.
Number of franchises: 3,177
Franchising since: 1979
Startup costs: $1,786,929 - $7,596,688
2010 rank: #10
No. 1: Hampton Inn/Hampton Inn & Suites
Hampton sits at No. 1 not because it bundles for free services that more upscale hotels charge through the nose for, or because it has a customer satisfaction guarantee (your money back if you're displeased for any reason, no questions asked) that's borderline insane, or because it just put waffle irons in all of its hotels. None of these hurt, but Hampton is tops because it listens to consumers and takes their ideas to heart.
Did you know: This year Hampton is launching in the U.K., Mexico, India, Romania and Trinidad.
Number of franchises: 1,753
Franchising since: 1984
Startup costs: $3,716,000 - $13,148,800
2010 rank: #4
No. 10: Denny's
Denny's is an American institution -- which is good and bad. It's got unbelievable brand recognition, but it's also saddled with decades of baggage, including a highly publicized discrimination lawsuit in the 1990s, a reputation as a hangout for late-night hoodlums and a bastion of bad food. But in 2009, Denny's began a hard and fast climb into the 21st century with one Super Bowl commercial, offering a free breakfast for anyone willing to wait. Two million people went in.Did you know: Denny's started out in 1953 as Danny's Donuts, becoming Denny's in 1959.
Number of franchises: 1,374
Franchising since: 1984
Startup costs: $1,125,609 - $2,396,419
2010 rank: #17
No. 9: Subway
Last April, Subway threw its hat into a crowded ring by introducing a full line of breakfast sandwiches nationally. It was a risk for the hero-slinging behemoth, but according to the company, which does not release sales figures, the initiative exceeded expectations and boosted per unit averages. That has helped keep the 34,000-unit restaurant expanding. It added 2,000 stores in 2010, including 800 new locations outside the United States, and it expects to open 2,100 sites this year.Did you know: Subway claims there are more than 2 million sandwich varieties available in its stores.
Number of franchises: 33,188
Franchising since: 1974
Startup costs: $84,300 - $258,300
2010 rank: #1
No. 8: Servpro
One good thing came out of the catastrophic floods that hit downtown Nashville, Tenn., last May: It gave Servpro a chance to show its home state what it's all about. The cleanup and restoration company, which specializes in smoke, fire, water and mold damage, mobilized its disaster recovery team and brought almost 700 crews from its 1,600 locations to Music City to help clean up the mess. It showed just how strong a national franchise can be in an industry dominated by small independent operations.Did you know: After 40 years in business, Servpro opened its first international location in 2010.
Number of franchises: 1,526
Franchising since: 1969
Startup costs: $127,300 - $174,700
2010 rank: #9
No. 7: Vanguard Cleaning Systems
Vanguard Cleaning Systems is in the Top 10 -- and its competitors are not -- because its quality and customer service are rare in the cleaning biz. Instead of rushing to put franchisees on the streets, Vanguard has taken care to select the right master franchisees and emphasize training. "Businesses look to companies like ours because of our training, customer support and quality," says Mark Heisten, vice president for business development.Did you know: Vanguard has benefited from the recession as companies have scrapped their janitorial department to cut costs.
Number of franchises: 1,847
Franchising since: 1984
Startup costs: $8,200 - $38,100
20010 rank: #30
Startup costs: $8,200 - $38,100
20010 rank: #30
No. 6: Days Inn
The old chestnut in the hospitality industry is that hotels are the first to feel a recession and the last to recover. This is demonstrably true. So Days Inn, one of Wyndham Hotel Group's 13 brands and the largest economy hotel chain in the world (based on number of rooms), did what any company in fear for its profit margin would do when tough times struck. It tried to save every penny it could.Did you know: In recent years, Days Inn has opened hotels in China, the U.K., Costa Rica and Russia.
Number of franchises: 1,857
Franchising since: 1972
Startup costs: $192,291 - $6,479,764
2010 rank: #21
Startup costs: $192,291 - $6,479,764
2010 rank: #21
No. 5: Supercuts
Before the Great Recession hit, Supercuts' growth pattern mirrored pretty much everyone else's -- wherever a shopping plaza was going up in a new market, it was there. But as construction projects dried up around the country, Supercuts began to rethink that strategy. The company will add 100 units nationally this year, and expectations are for double that in 2012.Did you know: A Supercuts franchisee in Houston set a new Guinness world record in 2009 by giving 349 haircuts in 24 hours.
Number of franchises: 1,035
Franchising since: 1979
Startup costs: $112,550 - $243,200
2010 rank: #5
No. 4: 7-Eleven Inc.
It's not that 7-Eleven isn't picky about its locations -- it pays plenty of attention to demographics, site selection and other basic metrics of franchising. It's more that it's adaptable, and during the past couple of years it has become like the yoga-master of franchising. Want to convert a mom-and-pop convenience store to a 7-Eleven? Need to squeeze a small convenience store onto a college campus or airport? Own a gas station but don't have the cash or experience to run the convenience store? 7-Eleven can help.Did you know: A new 7-11 opens every 6.5 hours.
Number of franchises: 37,039
Franchising since: 1964
Startup costs: $30,800 - $604,500
2010 rank: #3
No. 3: McDonald's
You probably haven't noticed many Golden Arches going up around the country--the fast-food empire has more or less hit its North American saturation point, adding about 100 locations to its existing stock of 13,894 in 2010. But McDonald's has managed to stay dynamic (though it is putting up new stores in India and China, which is expected to open 600 new Mickey Ds by 2013). The focus at home is on improving quality and customer experience.Number of franchises: 26,209
Franchising since: 1955
Startup costs: $1,057,200 - $1,885,000
2010 rank: #2
No. 2: ampm
Ampm has been pushing hot dogs and Snickers bars to U.S. travelers for more than 30 years, but the brand may not ring a bell. That's because for most of that time, ampm was only found in five western states, as the convenience brand of the Arco gas company. But in 2006, BP, which absorbed Arco in 2000, decided that the popular convenience store chain was ready to go national. Since then, BP has steadily sold off its BP Connect and other gas-station convenience stores, converting them to ampm franchises.Did you know: In 2010, ampm launched a "secret menu" of snack bar recipes available only via Facebook.
Number of franchises: 3,177
Franchising since: 1979
Startup costs: $1,786,929 - $7,596,688
2010 rank: #10
No. 1: Hampton Inn/Hampton Inn & Suites
Hampton sits at No. 1 not because it bundles for free services that more upscale hotels charge through the nose for, or because it has a customer satisfaction guarantee (your money back if you're displeased for any reason, no questions asked) that's borderline insane, or because it just put waffle irons in all of its hotels. None of these hurt, but Hampton is tops because it listens to consumers and takes their ideas to heart.Did you know: This year Hampton is launching in the U.K., Mexico, India, Romania and Trinidad.
Number of franchises: 1,753
Franchising since: 1984
Startup costs: $3,716,000 - $13,148,800
2010 rank: #4
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Comments (Page 2 of 2)
One thing to watch with franchises: territory. They watch your sales and if your sales reach a certain point, they put up more stores near yours to compete so that you only barely get by. And since you invested your life savings, you can't leave. Nobody will buy your store and you can't convert it into something else. So you are stuck working for peanuts. Franchises sort of trick people into slavery that way.
Recently visited Dubai in the UAE, and was surprised to see not only Subway and McDonald's there, but KFC as well. You can say these restaurants have nasty food if you like, but they must be doing something right, especially when an Islamic country has them.
I was suprised to see Deny's there at #10. The Denny's in Auburn Me, is terrible, terrible, terrible. I have eaten in Denny's in other States, it is usually OK, but this place is terrible, the food tastes lousy. Service is fine, but is terrible. Did I use the word enough. I thought franchises were suppose to servive the same fare. I find that only McDonalds can make that clim when it comes to food. Check it out corporations!!!!!
Subway sandwiches are horrible,how is it possible to make a sandwich so unappealing. The fact that the employee making the sandwich didn't speak any English was probably a large part of the problem.
Give me IHOP or Shoneys or any other chain over Dennys any day!
I used to be a regular at Wendys. Poor old Dave would be rolling in his grave if he saw what Wendys is now; an overpriced underperforming bucket of lard. I give them a year at most. Bye, bye.
All the 7-11's around here have foreign franchisees. Some can barely speak English. How did they get in and how did they get the money for the franchise fee. Most of the non-7/11 stores in the area that are foreign owned are very sparsely stocked. I don't see how they're making any money at all.
I don't know about most of these places. I do know about Denny's. We would frequent Denny's in Woodland Hills, Ca in the 80's. It seemed, they didn't take our order. I guess we were so busy talking, it just didn't register, until we had been sitting there for more than 30 mins. People were coming in and getting their orders etc. We found out later, it was a practice of theirs... I didn't join in the Class Action Suit. I just stopped going there and will never go there again. The food wasn't that good anyway...
7-11 just took over our White Hen Pantry in MA. Our White Hen sold local farm fresh vegetables and had a great deli and so many other choices. There were always cars in the parking lot and at times you had to wait for a spot. The owner asked to keep the deli & fresh veggies and 7-11 told him no because that isn't what 7-11 is all about. There is never more than 1-2 cars in the parking lot now. what a shame.
Denny's started franchising closer to 1960 than 1984.
Approving tips about CLASS Act .We should keep in mind while opting care insurance .For myself I have care insurance with Bankers life insurance & casualty company and I claimed for the care insurance before 2 months and happy with satisfactory services.