Aspiring Business Owners Choose Franchises Over Startups or Businesses For Sale

March 13, 2023 – In a February 2024 survey, aspiring business owners preferred the option to “buy a franchise” over buying an existing business by more than a two-to-one margin. While 65.3% indicated interest in the franchise purchase option, only 31.6% indicated an interest in buying an existing business for sale. These results are very consistent with our last review of aspiring business owner preferences.

Starting up a non-franchise business was chosen second most often as an option, by 54.7% of respondents. The totals add up to more than 100% since survey participants could choose more than one option and are considering more than one.

In the same survey, a record number of aspiring entrepreneurs planned their startups within the next three months, and over 63% agree that “now is a good time to start a business.”

While reasons for the preferences were not collected in the survey, the benefits and support of a network of successful franchise owners and recognized brands are well-documented, with more than 792,000 franchise units in the US. Startups of entirely new businesses fail for a myriad of reasons – poor business plan or product, insufficient capital, or failures in execution. Purchases of existing businesses can require much more capital up front with many of the same risks and no network of training and support typically available to franchisees.

Even in a recovering economy, access to funding remains a primary concern of aspiring business owners, though interest rates have moderated and markets expect further rate declines and looser credit in 2024. More  entrepreneurs plan to use personal financial resources than a year ago, likely related to the cost and availability of loans in addition to the magnitude of investment and working capital required.

This survey of aspiring business owners was conducted in February 2024 for the most recent Small Business Startup Sentiment Index™, which is conducted monthly by FranchiseInsights.com on individuals in the U.S. inquiring across the FranchiseVentures lead generation platform. It should be noted that visitors to these franchise directory websites may have an awareness of franchises that may not be representative of aspiring businesses owners as a whole.

FranchiseVentures is the leading franchise lead-generation platform for potential franchisees to thousands of growing franchise systems in the United States and Canada. Its franchise lead generation brands include Franchise.com, Franchise Solutions, Franchise Gator, Franchise Opportunities, Franchise For Sale, SmallBusinessStartup.com and BusinessBroker.net, and together they provide the largest aggregation of prospective franchise buyers in the U.S.

Interested in more insights from our proprietary data set? Subscribe here to make sure you hear about them first.

Contact FranchiseVentures to get your share of today’s aspiring franchise owners.

 
Published on Tuesday, March 12th, 2024.