Intrigued by the idea of owning a franchise but don’t want the hassle of operating one?
I get it. Franchises can be terrific businesses, but many require you to be an owner-operator (i.e., they want you to actively work on premises running the operations).
But if you have a full-time job that you want to keep or just want to make some serious extra money on the side, working full-time at your franchise is not going to work.
The solution is absentee (or semi-absentee) ownership.
In this article, we are going to discuss 7 types of franchises (plus 2 bonus ideas) that can be operated on an absentee basis. We’ll also include links to specific franchises that permit (or even encourage) this type of ownership.
We’ll discuss each of these 7 franchise types in detail, but first, we’ll cover some introductory questions around absentee-owned franchises and 4 important questions you need to ask to determine if a franchise can be operated on an absentee basis.
If you want to skip ahead to the main discussion around the 7 franchises types, just click here.
This post may contain affiliate links. If you click on a link and complete a transaction, I may make a small commission at no extra cost to you.
The information contained in this post is for informational purposes only. It is not a recommendation to buy or invest, and it is not financial, investment, legal, or tax advice. You should seek the advice of a qualified professional before making any investment or other decisions relating to the topics covered by this article.
What Is Absentee Ownership of a Franchise?
Absentee ownership of a franchise means you own the franchise without working there. You put in place a management team and employees to run the day-to-day operations instead. In some cases, you may not even live near the physical location of the franchise.
Semi-absentee ownership is similar to full absentee ownership, but you may have more of a role in the operations of the franchise. You still outsource most of the operations, but you may check in and assist when necessary or personally oversee the operations from time to time.
In both cases, you should not be completely absent from the running of the business. You will want to oversee the performance of the management team and make sure your business is staying on track.
Note: For purposes of this article (and to make the reading experience better), when I refer to absentee ownership, I will be including semi-absentee ownership within that definition.
How Do I Know If a Franchise Is Suitable For Absentee Ownership?
A franchise is suitable for absentee ownership if the following are met:
- Franchise agreement allows absentee ownership
- Franchise generates enough cash flow to hire managers and employees
- Owner’s specialized skills or licenses are not essential to business
- Absentee ownership is the prevailing business model
Does the Franchisor Prohibit Absentee Ownership?
This is straightforward.
If the franchisor doesn’t allow absentee ownership, that’s it. Unfortunately, many franchisors don’t allow absentee or even semi-absentee ownership. But there are some that do. It may take some digging to find them, but I have tried to short-circuit some of that work for you.
Throughout the article, I have provided links to franchises that accept (and even encourage) absentee ownership. They can be a good starting place for you.
Does the Franchise Generate Enough Cash Flow?
You want to own a franchise that has high cash flow (cash flow is money left over after operating expenses have been paid). If you want to be an absentee owner of a franchise, that franchise has to be able to support a manager and employees.
If you buy a franchise that does not generate that type of cash flow, you will be an owner-operator. In that case, you did not buy a business, you bought a job.
Are Special Licenses or Skills Required?
You want to own a franchise that doesn’t require special expertise, licensing, or training (other than the training that the franchisor provides).
For example, you may need a daycare license if you want to operate an at-home childcare franchise. Or you may need a professional license if you are buying certain franchises in the health services industry.
Bottom line: The less that the franchise needs your specific skills, licenses or expertise, the more suitable it is as an absentee-run operation.
Is Absentee Ownership the Prevailing Business Model?
This is important. When evaluating a franchise, look at whether many of the owners have multiple stores. If yes, then it means that the business model can probably support absentee ownership.
For example, many fast food franchise owners own multiple locations (with some owning dozens). They are clearly operating as absentee owners (or at least semi-absentee owners) and doing so successfully. Knowing that other owners are doing this should give you some confidence that you can too.
With those general principles in mind, let’s dive into some of the best franchises for absentee ownership.
1. Fast Food Franchises
I know this one’s pretty obvious, but there’s a reason it’s first on the list. When most people think of franchises, they think fast food.
McDonald’s, Burger King and Subway are just a few of the very well-known franchises in this space. These franchises all have robust training programs and very detailed operations manuals, so your manager can run the operation the way it’s supposed to be run.
That makes absentee ownership easy.
One niche that I like in this space is frozen yogurt franchises.
Just looking around my neighborhood, I see many of them successfully operating as absentee-run businesses. You may want to look into self-service models like Sweet Frog.
I like this model because the customers do most of the work. They select their container size, pull the handle on the machine to get their frozen yogurt and scoop on whatever toppings they like.
There are several near me that are staffed by one or two teenagers who mostly just handle the register.
2. Fitness Franchises
Fitness franchises are often operated via absentee ownership.
In fact, they are probably one of the most common absentee-owned franchise types. They can be pricey, but they can also generate a ton of money.
One that openly supports absentee ownership and has an ebook explaining its benefits is Workout Anytime.
Bottom line: As with fast-food franchises, the key is finding good managers and skilled employees to run the fitness facility. Having a good manager is especially important here because your manager is also your main salesperson. Their ability to sell memberships is going to be critical to the growth of your business.
3. Hair Salon Franchises
A hair salon franchise is another prime candidate for absentee ownership.
That’s because, as a general rule, you don’t need to be a licensed hairstylist to own one. It’s a simple business and you don’t need highly skilled managers to successfully operate one (unlike a gym): people walk in and your stylists provide the haircuts. No inventory management is required and the whole thing is fairly straightforward.
Just put in place solid managers to oversee your team of skilled hairstylists and you’re pretty much there.
My Salon Suite is an example (there are many more) of a franchise that explicitly allows for semi-absentee ownership. If you are interested in learning more about them, check them out here.
4. Cleaning Franchises
Cleaning franchises can be a great absentee-owned business. What I like about cleaning franchises is that they often have lower start-up costs compared to other franchise types.
Some cleaning franchises, like Maid Right, are deliberately transitioning to a semi-absentee model. If you want to learn more, check them out here.
5. Education Franchises
Education franchises can be profitable businesses, but you need to hunt around a bit to find one that allows for absentee or semi-absentee ownership. Many popular education franchises, such as Kumon, do not permit absentee ownership.
But there are some that do.
One notable example is Club-Z. They clearly state that their owners don’t tutor or teach: they simply manage a staff of tutors. What’s better is that the business does not require a store-front and can be run from home.
This type of set-up sounds like a perfect model for absentee ownership.
6. Car Wash Franchises
There are many car wash franchises out there that can be run on an absentee basis. In fact, car washes, like fitness centers, are very popular for absentee ownership.
If you want an example of a car wash franchise that supports this type of absentee ownership model, check out Super Wash. They proudly tout their fully turn-key business model and have processes in place to make it a reality.
7. Laundromat Franchises
Laundromats are a natural fit for absentee ownership. After all, the machines are doing the hard work of washing and drying the clothes (with your customers doing the work of loading and unloading the clothes).
Even outside of the franchise space, a standalone laundromat can be a great option for absentee ownership. If you want to learn more, check out my article on how to run your laundromat as an absentee owner.
But getting back to laundromat franchises, I found one that actually specializes in the absentee ownership model.
Check out WaveMax Laundry. They offer a soup-to-nuts laundromat solution, including finding ideal locations and helping you design and pick out the right equipment for your laundromat. Their solution uses a model based on full-time attendants that will operate your business day-to-day, so you don’t have to.
Two Bonus Ideas
Here are two bonus ideas to consider: (1) FedEx routes and (2) bread routes.
I admit that neither are franchises in the traditional sense, but you are still working with huge companies and leveraging their existing branding, infrastructure, and operations.
When you own a FedEx route, you contract with FedEx and get a territory from them. FedEx pays you for deliveries made within that territory.
You basically partner up with FedEx – they provide the packages each morning and you deliver them. You don’t have to worry about customers, competition, marketing or anything else really. All you have to do is make sure the packages get delivered.
Of course, if you want to run it as an absentee business, you can outsource this piece. This is what most FedEx route owners do.
If you want to learn more, check out my article on Absentee Ownership of FedEx Routes: a Beginner’s Guide
Bread routes operate on a similar premise.
You obtain a territory from Sara Lee or Arnold or some of the other major bread producers. You then sell bread (at a mark-up) to large retailers in your territory and deliver the product to them. These can include huge supermarkets and big-box retailers like Walmart and Target.
As with FedEx routes, you would need to hire the drivers to run the deliveries each day if you want to run the business as an absentee owner.
If you want to learn more about this business opportunity, check out my beginner’s guide to buying a bread route.
So there you have it – seven great franchise business ideas (and two bonus ideas) that can be operated on an absentee basis.
If you want to learn about other great absentee-owned business opportunities, check out my article on businesses that run themselves. In that article, I cover some great businesses that can generate attractive levels of return without a lot of day to day involvement by the owner.