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Home » The 5 Best Low Cost Franchises Opportunities to Buy & Own in 2020

The 5 Best Low Cost Franchises Opportunities to Buy & Own in 2020

April 22, 2020 by Jeff Long

Low Cost Franchises

When was the last time you made a quick food stop or purchased an espresso before work? If the brand is recognizable and has multiple locations throughout your city or town, like Burger King  or Dunkin’, it’s likely  your favorite food stop is a franchise business.

What is a franchise business?

A business in which independent entrepreneurs are able to use the rights to a larger company’s business name, logo, and products to operate an individual location. The franchiser is the owner of the larger company who sells the rights to license their business, and the franchisee is the third-party owner and operator of the business locations.

Maybe you’ve even considered purchasing and owning one yourself. But which franchises are best suited for your budget and skill set? I’ve compiled a list of the best franchise opportunities to select from.

Low-Cost/Cheap Franchises

The initial investment in a franchise can be pricey, and range anywhere from a few thousand dollars to over a million. If you’re looking to purchase a franchise at a lower price point, there are options for you in a variety of industries.

1. Cruise Planners

Franchise fee: $10,995

Initial investment: $2,095 to $22,867

Franchise details: Cruise Planners

Cruise Planners is a cruise planning agency. It’s home-based, so you don’t need to factor in the cost of real estate. Prior experience in travel planning is not required, and the company offers comprehensive training.

2. SuperGlass Windshield Repair

Franchise fee: $9,500 to $28,500

Initial investment: $9,910 to $31,000

Franchise details: SuperGlass Windshield Repair

SuperGlass Windshield Repair has been operating for 30 years and specializes in the repair of rock damaged and cracked windshields. Overhead costs can be kept low due to its mobile option — a physical shop location is not required.

3. JAN-PRO

Franchise fee: $2,520 to $44,000

Initial investment: $3,985 to $51,605

Franchise details: JAN-PRO

JAN-PRO is a commercial cleaning franchise whose clientele is other businesses. They offer three options for franchising: international master franchise, executive business, and home-based opportunities.

4. Jazzercise

Franchise fee: $1,250

Initial investment: $2,500 to $38,000

Franchise details: Jazzercise

If you’re looking to start a low-investment, exercise business a Jazzercise franchise might be a good fit for you. It offers various price points to begin a franchise and you can find the one that aligns with your budget.

5. Dream Vacations

Franchise fee: $495 to $9,800

Initial investment: $3,245 to $21,850

Franchise details: Dream Vacations

Dream Vacations is a home-based travel agency franchise with no overhead or inventory — this keeps the cost of initial investment low. It’s a great option for military veterans and offers discounted investment prices.

Best Franchise Businesses to Start and Own

  1. Freddy’s Frozen Custard and Steakburgers
  2. Culver’s Butterburgers and Frozen Custard
  3. Planet Fitness
  4. School of Rock
  5. Nothing Bundt Cakes
  6. Pure Barre
  7. Right at Home
  8. Soccer Shots
  9. Mathnasium

Forbes partnered with FRANdata to assess and assemble a list of the best franchises. Here are the criteria used to evaluate 3,300 franchise brands:

  1. System sustainability
  2. System demand
  3. Value for investment
  4. Franchisor support
  5. Franchisor stability

Below are some of the top picks from the best franchises to buy list. The key points the list looks at are the midpoint (average) initial investment, the franchise’s growth rate over the past five years, and the number of franchise locations, or franchise units.

1. Freddy’s Frozen Custard and Steakburgers

Midpoint initial investment: $1,295,964

Five-year growth rate: 31.3%

Total franchise units: 282

This fast-casual restaurant is known for its burgers and freshly-churned custard. After your initial investment and depending location and whether you’re buying or leasing property, you can expect your restaurant to open in eight to 18 months.

2. Culver’s Butterburgers and Frozen Custard

Midpoint initial investment: $3,347,500

Five-year growth rate: 6.50%

Total franchise units: 641

Founded in 1984, Culver’s has been in the burger and custard business. It’s a top franchise and offers an established operating system with over 35 years of experience.

3. Planet Fitness

Midpoint initial investment: $2,545,915

Five-year growth rate: 22.00%

Total franchise units: 1,494

Planet Fitness is known for it’s Judgement Free Zone® philosophy — making first-time gym users feel comfortable as they begin their fitness journeys. This gym has over 14 million members and franchisees have a median annual operating income of $567,000.

4. School of Rock

Midpoint initial investment: $237,975

Five-year growth rate: 18.5%

Total franchise units: 176

School of Rock is the largest music education franchise in the United States and has more than 29,000 students worldwide. This music business was started in 2007 and is still growing — between 2014 and 2018, it added 70 units to its franchise system.

5. Nothing Bundt Cakes

Midpoint initial investment: $483,437

Five-year growth rate: 32.1%

Total franchise units: 325

This bakery is unique because, despite being a franchise, it has a “Mom and Pop shop” feel. There are locations across the United States, and its cakes have been featured in popular media like Food and Wine Magazine, Food Network “Unwrapped”, and Franchise Times.

6. Pure Barre

Midpoint initial investment: $234,400

Five-year growth rate: 39.5%

Total franchise units: 472

Pure Barre is a popular, boutique fitness brand with nearly 600,000 clients. The business offers multiple revenue streams: bar classes and active wear. And it provides support and training for real estate, operations, consulting, marketing, and more.

7. Right at Home

Midpoint initial investment: $113,650

Five-year growth rate: 14.8%

Total franchise units: 475

Right at Home is an industry leader in home care and its mission is to improve the quality of life for its clients. It provides new franchisees with comprehensive training, and you don’t need prior business or home care experience.

8. Soccer Shots

Midpoint initial investment: $47,492

Five-year growth rate: 11.1%

Total franchise units: 195

Soccer Shots is a children’s soccer program with a focus on character development. It has a low overhead cost, supports its franchisees, and has well-established relationships with national brands like Adidas and the U.S. Soccer Foundation.

9. Mathnasium

Midpoint initial investment: $130,930

Five-year growth rate: 19.9%

Total franchise units: 797

This math learning center opened in 2002, and its mission is to “help every child understand – and master – math.” Mathnasium has earned many accolades, and over the past four years, average per unit gross sales grew 10% annually.

Most Profitable Franchises

  1. Dunkin’
  2. 7-Eleven
  3. Planet Fitness
  4. JAN-PRO
  5. Taco Bell
  6. Orangetheory Fitness
  7. Great Clips
  8. Mac Tools
  9. Cruise Planners
  10. Jazzercise
  11. McDonald’s
  12. RE/MAX
  13. Jimmy John’s Gourmet Sandwiches
  14. Papa John’s
  15. Anytime Fitness

When you’re evaluating a business investment, it’s important to know if the opportunity is worth the money. The franchises listed above are seeing the largest growth in franchise locations over the past year, which is one of the key indicators of profitability. Determining the profitability of a franchise isn’t an exact science, but there are a few factors to consider:

  1. Unit growth: See how many units (franchise locations) have opened in recent years.
  2. New franchisee success rates: Look at the percentage of new franchises that are still operating after a year.
  3. Franchisor’s financial statements: Analyze the franchise disclosure document and look at average sales per unit.

Whether you’re looking for a low-cost franchise, or ready to go all-in on a high investment franchise there are options for you. To learn more, read about how to become an entrepreneur next.

Filed Under: Business, Entrepreneurship

About Jeff Long

Jeff Long is a Senior Editor at BusinessChew. He writes about trends in technology and business that impacting the world.

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