The Birth of Modern Franchising

Many credit the Singer Sewing Machine Company for being the first company to franchise it's business.  According to the IFA, that simply was not the case.  They say that many histories about modern franchising have often cited Albert Singer and the Singer Sewing Machine Company as being the first commercial franchisor, dating franchising to 1851. However, in 1851, John “Albert” Singer was only seven or eight years old and the Singer Manufacturing Company never actually offered any franchises.  The company actually grew through local offices independently managed by its employees.  Further research uncovers the almost forgotten history of one "Martha Matilda Harper."  Harper did in fact became the first modern day franchisor. She began franchising the Harper Method Shops, a hair care franchise, which included elements like training, branded products, and advertising. At its peak, the franchise system grew to over 500 salons and schools.  

More iconic brands like A&W Root Beer came  along in 1924, when Roy Allen purchased a root beer recipe and began franchising A&W, offering car-side service. This period also saw the rise of other pioneering concepts like like White Castle restaurants and Hertz.

Expansion and Innovation

Franchising's Boom Days took place between the 1930s-1960s: This era saw the rise of many legendary chains such as Kentucky Fried Chicken, Dairy Queen, Dunkin Donuts, and McDonald’s. These pioneers, strongly influenced numerous food-service chains that followed.  

McDonald’s Public Stock Offering in 1965 was a most significant event, marking the rapid growth of the franchise. Other emerging brands in this period included Midas Muffler, Holiday Inn, and 7-Eleven.  Then came the 70s and the proliferation of other roadside hotel/motel chains and real estate brokerages like Howard Johnsons and Best Western on the hotel side and Century 21, ERA and Coldwell Banker in real estate.  

Conclusion

Fast forward to the modern day and there are some 300 different business format categories and nearly 800,000 franchised businesses across those categories, supporting over 8 million jobs and driving over $825 Billion of economic output for the U.S. economy, according to the IFA.  If you can think it, replicate it teach it to others and it can deliver reasonable ROI over a reasonable period of time, it's Franchisable.

Call to Action

This outline provides a broad overview of franchising history.  What milestones might you remember and care to share?

 

 


 

Comments & Upvotes