UNH Rosenberg Center Franchise 50 Index Outperforms S&P In 2006

News Wise:

The University of New Hampshire Rosenberg Center Franchise 50 Index™ outperformed the S&P 500 in 2006, and ended the year with a record 13.3 percent jump in the fourth quarter of 2006.

The Rosenberg Center Franchise 50 Index™, which was created by UNH William Rosenberg International Center of Franchising, was up 17.8 percent over the year, compared to 13.6 percent for the S&P 500. The index tracks the market performance of the top 50 U.S. public franchisors. These 50 franchisors represent more than 98 percent of the market capitalization of all U.S. public companies engaged in business format franchising. Since its inception in 2000, the index is up 82.3 percent, compared to 1.7 percent for the S&P 500.

“The year 2006 was eventful for franchised businesses. Major company restructurings took place, including Cendant Corporation’s breakup into four independent entities: Realogy (real estate), Wyndham Worldwide (hospitality), Avis Budget Group (vehicle leasing services), and Travelport (travel distribution services). Other major organizations included McDonald’s spin-off of its Chipotle Mexican Grill subsidiary and Wendy’s sale of its Tim Horton and Baja Fresh chains,�? according to the latest report from the UNH Rosenberg Center.

“Burger King became a publicly traded company once again. Private equity firms went on a buying spree and snapped up a record number of hotel and restaurant companies. Sandwich chain Subway once again took the top spot in Entrepreneur magazine’s Franchise 500 list, followed by Dunkin’ Donuts, Jackson Hewitt Tax Service and 7-Eleven. Subway also ranked first among quick service restaurants by customers in a survey by Corporate Research International,�? the report said.

The shift away from using trans fats in cooking had a significant impact on franchised and non-franchised restaurants in 2006, as several states and cities, including New York City, Chicago, New Jersey, and Massachusetts have either banned the use of trans fats or are considering such a ban.