Unit counts are not success
Openings, closures, transfers, terminations: the movement figures are the easiest numbers in a franchise to misread. They are counts of outlets, not verdicts on outcomes.
Movement numbers — openings, closures, transfers, terminations — are the easiest figures in a franchise system to misread, because they look like a scoreboard. They are not. They are counts of outlets.
What the counts say — and what they don't
A system that opened 40 locations and closed 8 in a year did not "succeed by 32 units." It opened 40 locations and closed 8. Both facts matter, and neither is a forecast for the next person to sign an agreement. A closure can mean a market saturated, a location mis-picked, or an operator who simply chose to move on. The count records that it happened. It does not record why, and it never records what it means for you.
Three habits worth keeping
- Read movement, not totals. A large total says little; the direction and composition of the movement between years says much more.
- Ask what the denominator is. Percentages are only meaningful when you know what they are a percentage of. We label the basis whenever we calculate one.
- Resist the extrapolation. Past openings say nothing certain about future returns. Franopolis does not project, and we would encourage you to be suspicious of anyone who does.
The honest summary
The count is a fact about a system. Your outcome is a fact about a specific operator, in a specific market, in a specific year — a fact nobody, including us, can hand you in advance.