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With thousands of brands to choose from in an ever-expanding array of categories, uncovering the right franchise concept can prove complicated and overwhelming for prospective franchisees. Even seasoned business professionals can find it daunting, and for first-timers it can be hard to know where to start.

Should passion or practicality be the deciding factor? Is an emerging or mature system the way to go? Which franchise segments are seeing strong growth? The Franchise Times Zor Awards project is here with research to help.

Designed to cut through the sales jargon and marketing speak, the Zor Awards, now in its ninth year, provides a top pick and two runners-up in each of 10 categories. We focus on return on investment in this project, which means profitability for the operator rather than top-line sales. (See page 37 for details on our methodology.)

Top-performing franchisees offer their honest insight and advice through interviews with the editorial team, and prospective owners can learn what it takes to drive sales and ultimately achieve success in each system. We also pull back the curtain on the franchisor-franchisee relationship as operators share what works and where they’d like to see improvement.

Do the research before you buy in and use the Zor Awards to help put the pieces in place.

—Laura Michaels

How we choose the Zor Awards

STEP 1: We start by selecting 10 new industry categories, which are chosen to be popular and attractive to different types of franchisees (for example, those who have a passion for fitness or want to run a restaurant). We change these categories each year.

STEP 2: We identify initial contenders for each category, drawn from the Franchise Times Top 400 database, which is a 20-year-old research tool covering more than 650 U.S.-based franchise systems. We further narrow the list by analyzing the quality of information in each brand’s Item 19 (which contains information about profitability for franchisees) or other key financial data, and also focusing on brands that are currently expanding within the United States.

STEP 3: Our research team examines six financial metrics in each brand’s franchise disclosure document, with a focus on profitability for the franchisee. Narrowing the list to three finalists in each category involves an assessment of the quality of the financial information disclosed, an exclusive calculation of return on investment, as well as editorial research including knowledge of management teams, product or service offerings, unit openings and closings, financial backing of the brand, litigation, etc.

STEP 4: To determine the winners, we then conduct a deeper dive into the finalist FDDs and publicly available financial metrics, forming one strongly weighted pillar of our three-part scoring process. Next, our editorial team talks to experts in franchising, reviews our own coverage of these brands, and looks at analyst reports, recent financial performance and outside press articles to form the second heavily weighted component of the ranking.

STEP 5: Lastly, we compile the results of the online voting conducted in December to reflect industry enthusiasm.

STEP 6: We then declare a winner in each category and conduct interviews with a few top-performing franchisees in each brand to share best advice and lessons learned.

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