Answer: Perhaps the earliest retail franchisor is Ben Franklin stores, which started in 1920 and began to franchise around that time. The earliest fast-food franchise was A&W® Root Beer, established in 1924, with Howard Johnson® being the first to franchise restaurants in 1935. An early pioneer in service franchising was Arthur Murray® Dance Studios, which got its start in 1938.

Franchising really took off as a form of business in the 1950s and 1960s, when many of the current large franchise chains, businesses such as Tastee-Freez®, KFC®, McDonald’s, and Burger King®, were established. The acceleration of franchising in the 1950s and 1960s can be attributed largely to two factors: the rise of television advertising and the establishment of the national highway system. The former made national advertising a viable way to build a brand name. As a result, for the first time, it became possible to have a national chain whose competitive advantage was based on a recognizable name. The latter made travel to unfamiliar locations more common and created the need to have national brand names to demonstrate quality to customers in these locations. [1]

Want to learn more about where franchising originated? Check out our quick read, “The History of Franchising.” 


[1] Scott A. Shane, From Ice Cream to the Internet: Using Franchising to Drive the Growth and Profits of Your Company, (Pearson Education: 2005), 5-6. http://www.informit.com/articles/article.aspx?p=360649&seqNum=2