It is speculated that the very first franchises date back to before 200 B.C. when rickshaw drivers were granted specific routes. In the United States, transportation and the growing mobility of Americans launched retail and restaurant chains, and franchising in the manufacturing segments of the economy. In 1876, Frederick Harvey opened the first of the Harvey House restaurants in a terminal of the Atchison, Topeka & Santa Fe Railroad. The railroad wanted to open depot restaurants for its passengers and provided Henry with locations and free transportation of restaurant supplies. A decade later, there was a Harvey House every 100 miles along the 12,000-mile-long line, with Harvey overseeing quality control and making regular field visits to his stores, common business practices used by modern franchise operators.

Franchising as an industry first came into its own during the 1930’s and 40’s when several hotels and gas stations decided to begin offering new dealers a comprehensive system of operational and marketing strategies. Since that time the franchising industry has become a national power in America’s economy and a blessing for risk-averse entrepreneurs. Today, more than 3,000 franchisors and 650,000 franchisees testify to the increasing growth of the industry, and according to Financial Times, if sales by U.S. franchise businesses were translated into national product, they would qualify as the seventh largest economy in the world.  Franchising is a major force in almost every industry imaginable, accounting for a disproportionate share of retail sales throughout the U.S.  Why is franchising growing so rapidly? Because franchising works. Franchising allows aspiring business owners to pursue their dreams in an industry that they love while eliminating much of the risk and guesswork that usually accompanies a new business start-up. A franchise provides a proven system, a business model that has worked and is working, usually for tens or even hundreds of other franchise owners.
Here are some interesting statistics about the franchise industry:

• The franchise industry accounts for 40 percent of all retail sales in the United States and one out of every 12 businesses is a franchise.

• The average net income for a single unit franchise is $76,000, and $142,000 for a multi-unit franchise.

• Franchises will generate more than 1 trillion dollars in sales this year

• While franchises only account for 8% of all service business, they claim over 40% of all service-related revenue.

• Franchises currently employ more than 8.5 million Americans.

• If current trends are any indicator, the growth of the franchise industry shows no signs of letting up: more than 300 different types of industries and businesses are franchising and a new franchise opens every five minutes, accounting for 35 percent of all retail goods and services sold.

• According to statistics from the U.S. Department of Commerce, less than 5% of franchise outlets fail annually.

• In a 1991 study of 366 franchise companies opened during the previous 5 years, Arthur Andersen & Company found 86% of the franchise outlets to be still under the same ownership.

• In the same study, Arthur Andersen & Company found 97% of those businesses to be still in business

• By contrast, according to statistics derived from the U.S. Small Business Administration, during a ten year period, over 60% of non-franchised businesses were ended within the first 6 years due to failure, bankruptcy or retirement.

• There are believed to be more than 750,000 franchise businesses in the U.S.

• The franchising industry and businesses employs over 18 million people in the U.S.

• In 2004, it is estimated that franchise businesses were responsible for over 1.5 trillion in economic output.

• A new franchise business opens every 8 minutes of every business day