Franchising is one of the most proven and scalable growth strategies in the world. It enables ambitious entrepreneurs to replicate a successful business model, expand into new territories with reduced capital risk, and capitalize on the momentum of a growing network. At the same time, it offers investors and private equity firms an attractive, predictable cash flow business model with high resale value.

FMS Europe is proud to have accelerated the growth of multiple companies across industries, helping founders transform strong local businesses into powerful franchise brands.

The European Franchise Industry: Resilient and Expanding

The European franchise market represents thousands of brands and hundreds of thousands of franchise locations. It spans almost every sector: food & beverage, health & beauty, fitness, automotive, home services, retail, education, and more.

• Rising Consumer Confidence: Positive economic trends in much of Europe are boosting consumer spending and brand loyalty.
• Growing Middle Class: Countries across Europe are seeing increases in disposable income, creating a larger pool of potential franchise customers and franchisees.
• Entrepreneurial Shift: Professionals leaving corporate careers increasingly see franchising as a safer, structured path to business ownership.
• Cross-Border Expansion: The EU’s free movement of goods and services facilitates the scaling of brands into multiple countries once a proven business model is established.

Why Franchising Works

• Lower Risk for Franchisees: They buy into a proven model with established branding, systems, and support.
• Faster Scale for Franchisors: Growth is fuelled by franchisee investment rather than solely corporate capital.
• Shared Marketing Power: Franchise networks pool marketing budgets for greater reach and efficiency.
• High Survival Rate: Globally, franchise businesses consistently outperform non-franchised start-ups in long-term survival rates.

The Private Equity Advantage: What Happens When You Build It Right

Building a strong franchise network isn’t just about royalty income, it’s about creating a valuable asset. Private equity firms and strategic buyers actively seek high-performing franchise brands, often paying 6×:12× EBITDA depending on sector, scalability, and profitability.

Major European Example

• PizzaExpress: Sold to private equity firm Hony Capital for around €1.06 billion. Though a large-scale transaction, it highlights how strong brand equity, scalability, and loyal customer bases command high valuations.

Smaller & Mid-Market Examples

These are more attainable and directly relatable to many franchisors:

1. Body Fit Training (BFT): Boutique fitness franchise acquired by a PE-backed buyer for around €40 40:45 million. Demonstrates the appetite for scalable, systemized health and fitness concepts with room to grow.
2. Lawn Doctor: Residential lawn care franchisor acquired in a deal valuing the business in the tens of millions, with a majority control stake purchased alongside growth capital for expansion.
3. Snap Fitness: Recapitalized in a transaction valuing the brand at over €180 million, at a reported multiple of approximately 9.5× EBITDA, showing strong investor appetite for recurring revenue and global growth potential.
4. YogaWorks: Acquired for approximately €42 million, with the buyer later expanding the platform with complementary franchise fitness brands.

Key Takeaways for Potential Franchisors

• You Don’t Need to Be a Billion-Euro Brand to Attract Buyers: Many acquisitions happen in the €20 20:100 million range, especially for well-run, niche brands with room to scale.
• Multiples Can Be Substantial: Even smaller networks can achieve healthy EBITDA multiples if they have recurring revenue, robust systems, and strong unit economics.
• Operational Excellence Pays Off: Brands with clear documentation, protected IP, and an engaged franchisee base are more attractive to investors.
• Strategic Buyers Want Synergy: Larger franchise groups seek brands they can cross-promote, integrate into existing supply chains, and scale internationally.

What This Means for You

Whether you’re in boutique fitness, home services, hospitality, retail, or education, the combination of a scalable business model and a well-executed franchise system can lead to life-changing outcomes:

• A thriving, profitable network delivering ongoing royalties.
• The ability to sell the brand at a premium to private equity, strategic buyers, or larger franchise groups.

At FMS Europe, we specialize in making that happen, building your systems, training, marketing engine, and compliance to ensure your brand is diligence-ready for growth and, when the time comes, a high-value exit.