---
title: "What Is The Most Profitable Franchise?"
url: https://burnaze.com/article/f1a93339-16cd-44b4-9446-5326d97d5234
source: "1851 Franchise"
original_url: https://1851franchise.com/which-franchise-should-you-buy-to-get-the-best-roi-2715078
category: "Franchise Industry"
industry: "Franchise Industry"
topics: ["Finance & M&A"]
published: 2021-02-23T20:15:04.000Z
modified: 2026-11-01T02:26:33.099Z
image: https://newimage.1851franchise.com/cdn-cgi/image/quality=85,format=webp,width=1280,height=720/story/featureImage/7ebc07ff548d1ae1207772929759c8331402.jpg
---

# What Is The Most Profitable Franchise?

**TL;DR:** Calculating the ROI of a franchise is complicated, considering factors such as potential earnings and initial investment. Prospective franchise owners should consider various points, including potential earnings, initial investment, and franchisee and royalty fees, to determine a franchise's ROI.

*originally published in 1851 Franchise on 2021-02-23. [Read the original](https://1851franchise.com/which-franchise-should-you-buy-to-get-the-best-roi-2715078).*

## Story

When choosing a franchise concept, prospects tend to ask one question first: what is my potential ROI (return on investment)? With thousands of different concepts out there, each with different levels of profitability, calculating the ROI of a franchise is complicated. Here are some of the basic points to consider:

- Potential earnings: Within the brand’s FDD (franchise disclosure document), Item 19 offers performance information on existing franchised locations. The Item 19 is not a guarantee of how well the business will do, and franchisors are not required to provide one, but when available it offers statistical information that can help determine ROI.

- Initial investment: The FDD also provides an approximation of the initial investment (Item 7). The upfront costs obviously play a major role in the potential for ROI, and should be weighed carefully against a prospect’s available capital and potential financing. For those looking for low cost opportunities, mobile or home-based concepts tend to have a much lower initial investment as there are no construction or rent costs.

- Franchisee and royalty fees: Most franchise concepts require initial and continuing fees paid to the franchisor, which can be found in Items 5 and 6 of the FDD. These fees will also have an impact on the potential ROI.

Dozens of variables combine to determine a franchise’s ROI, and many depend on the individual prospective owner/operator. To understand these factors, enlist the help of a knowledgeable franchise consultant, accountant or another financial advisor. These experts will evaluate the prospect’s specific situation and create a reasonable projection that details the return on investment the owner can expect to achieve.

## Entities

- 1851 Franchise (publication)
- Franchise Industry (sector)
- franchise investment (topic)
- franchise fees (topic)
- initial investment (topic)
- roi calculation (topic)

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Originally reported by 1851 Franchise (https://1851franchise.com/which-franchise-should-you-buy-to-get-the-best-roi-2715078). Summarized by Burnaze (https://burnaze.com/article/f1a93339-16cd-44b4-9446-5326d97d5234).