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🤔The Most Common and Successful Franchise Business Models

Implications for revenue potential and investments needed

Author

Chris Wright
January 30, 2025

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Thinking about buying a franchise? Your first big choice isn't the brand - it's the business model. From high-ticket roofing projects to recurring lawn care services, here's how to pick your lane.

Key Highlights:

  • Brick-and-Mortar franchises require significant real estate investment but can be more recession-resistant compared to other models.

  • Project models can use contractors, keeping overhead low until jobs come in.

  • Subscription models (like lawn care) offer steady revenue but require more fixed costs.

  • Subscription businesses require investments in staff and equipment and may be easier to scale.

👉️ Why It Matters:

Your choice of model impacts everything from daily operations to long-term success. Project-based franchises offer flexibility with contractors and higher per-sale profits, but need sales expertise. Subscription models cost more to start but provide predictable revenue and easier scaling through technology.

🥷 The New Franchise Growth Hack

Hand & Stone's strategic takeover of 53 indie massage spots exposes a growing trend in franchising: conversion is the new expansion. Instead of building from scratch, franchisors are eyeing existing businesses to fuel faster growth.

Key Highlights:

  • Conversions skip the biggest headaches: no construction delays, 10-20% lower rent costs, and instant staffing.

  • Existing locations come with built-in customers and operational infrastructure.

  • Strategy worked for Hand & Stone, which converted 30 LaVida Massage and 23 Massage Green locations.

👉️ Why It Matters:

Conversions offer a smarter path to growth - but only with the right support system. That's why brands like Hand & Stone invest heavily in transition support, including week-long owner training and on-site staff assistance. It's a win-win. Brands expand easily, owners get big-brand support without the struggle.

🍔 Restaurant Giants Share Their 2025 Game Plan

From NYC's biggest Applebee's operator to a 122-unit Sonic franchisee, the industry's heavyweights are shifting focus from survival to strategy. What's the new motto? Creating value without racing to the bottom on prices.

Key Highlights:

  • After years of "survive until '25," operators are now shifting from survival to strategic growth mode.

  • Rising costs are forcing rapid adaptation - menu prices now change up to 4 times yearly vs. previous once or twice.

  • Food cost inflation hit hard - Sonic franchisees saw 40% spikes, pushing margins from double to single digits.

  • The solution? Leaders are redefining value beyond discounts through bundled perks, free delivery, and added services.

👉️ Why It Matters:

2025 marks a turning point for restaurant franchising. After years of "survive until '25" mentality, operators are finding creative ways to maintain profits without sacrificing value. The winners will be those who can thread the needle between customer value and operational efficiency.

🏥 From Physical Therapy to Franchise Pioneer

After 15 years of watching seniors end up in the wrong care facilities, physical therapist Matt Staley spotted a gap. Now his franchise Trua is reimagining how we match seniors with living facilities, using clinical expertise and custom tech to solve an age-old problem.

Key Highlights:

  • Model targets the earliest stage of senior care - helping families find the right facility before problems start.

  • Built proprietary software that matches seniors to facilities based on clinical criteria, eliminating unsuitable options automatically.

  • You can get in for a reasonable investment of $74,000 to $116,000.

  • Unlike competitors, founders provide direct training - one week at HQ and one week in franchisee's territory.

👉️ Why It Matters:

While most senior care franchises focus on providing care, Trua is tackling a different challenge: ensuring seniors end up in the right facility from day one. Their clinical approach to placement, backed by custom technology, could reshape how families navigate one of life's most stressful transitions.

✂️ Snippets

No insurance experience needed for this fast-growing play. Estrella Insurance is turning regular entrepreneurs into insurance pros with just $12K-$84K down. With 212 locations (up 21% in three years) and a #172 spot on the Franchise 500, they're making the $1.7T insurance industry accessible to newcomers through full training and support. (Source: Entrepreneur)

The smoothie giant Tropical Smoothie Cafe just wrapped a monster year with 161 new locations and 247 franchise deals signed. Most telling stat? Over 70% of growth came from existing owners doubling down. After 13 straight years of positive same-store sales, they're now ranked #1 in their category on Entrepreneur's Franchise 500 for the fourth year running. (Source: Franchising.com)

Restaurant365’s 2025 survey shows labor costs spiking for 90% of operators - up 10% in just six months. Most concerning? Staff turnover hitting 25% for many locations. (Source: Restaurant365's 2025 State of the Restaurant Industry Report)