Buddy's Home FurnishingsRent-to-own home furnishings, electronics, and appliances
- 2023 Franchise 500 Rank
#242 Ranked #226 last year
- Initial investment
$356K - $879K
- Units as of 2023
338 16.2% over 3 years
Buddy's Home Furnishings Franchise
Ready to get into business for yourself? Becoming a franchisee can be a stable option for entrepreneurs looking for a promising new business endeavor.
In recent years, the franchise industry has become more successful than ever. In 2022, approximately 8.45 million franchise employees worked to reach a total production output of $826.6 billion, according to the International Franchise Association.
The more entrepreneurs choose the path of owning a franchise, the more growth the industry will experience. If becoming a franchisee sounds like a good fit for you, read on to find out more about an excellent option for getting in on the revenue.
Reasons to become a franchisee
Becoming your boss can be a gratifying experience, but it can also often come with the struggles and financial woes synonymous with startups. However, an added level of stability comes when partnering with a franchise.
The company you sign on with will have a track record of success and be able to provide you with guidance, brand recognition and resources that you would not have when starting a business from scratch.
- Guidance: Most companies do not decide to pursue franchise development until they have years of business success and have scaled to test that a more extensive operation will work. You can take comfort in the fact that there will be a roadmap when you join.
- Brand recognition: Franchises already have established marketing strategies, so you will not have to create those tactics alone. You might have to pay an advertising fee as part of your agreement, but it can be well worth the investment.
- Built-in customer base: People will already know the company's name, relieving you of the long journey to acquire customers and build repeat business.
Buddy’s Home Furnishings, based in Orlando under the direction of CEO Michael Bennett, has been around since 1961 and now operates over 300 franchise and corporate locations nationwide.
Related: 7 Things You Need to Know Before Becoming a Franchise Owner
Pros and cons of becoming a franchise owner
Starting a new business is often filled with uncertainty. However, starting a business as a franchisee comes with some added perks. Check out the pros and cons to consider before entering into a franchise agreement.
Related: 3 Key Considerations for the Modern Franchisee
Pros of becoming a franchise owner
As a franchise owner, there are many pros, some of which are:
- There is no experience or level of expertise required in most cases.
- The franchisor provides online or in-person training and support.
- An established company ensures trusted systems are proven to work.
- Customer loyalty and brand recognition are built into partnering with a known name.
- The marketing reach of a franchise is more significant than an independent small business.
Cons of becoming a franchise owner
No business decision is ever 100% full of positives. There will always be less desirable aspects and drawbacks to be prepared for.
Lack of freedom is one of the most significant factors to be aware of when considering becoming a franchise owner. Yes, you will own that location and might have some wiggle room for how you lead, but ultimately the control is not in your hands.
The franchisor makes the decisions when it comes to operations, design, branding and other creative possibilities. You may not have the same freedom you would get with an independent business, as you must follow the status quo that the company mandates.
Other cons of being a franchise owner include the following:
- Restrictions on real estate like building structure, location and layout.
- The cost of initial investment and ongoing fees like franchise fees, royalty fees and license fees.
- You must allow the franchisor access to your finances.
Buddy’s Home Furnishings background information
Before entering a franchise agreement, always consider the company’s story.
In 1961, Buddy’s was founded in Tampa, Florida. Its mission has always been to help customers afford home necessities by offering affordable payment plans without the stress of credit or financing looming over their heads.
In 2009, the company decided to franchise to serve a larger audience and reach new markets nationwide.
What to know about Buddy’s Home Furnishings
Now that you’ve got a bit of history, it’s time to go over the process, costs and everything else you need to know about franchising with Buddy’s.
What are some critical facts about Buddy’s operations?
As the fastest-growing US company in the rent-to-own industry, Buddy’s Home Furnishings'business model has figured out how to maintain profits while keeping its services affordable. Take a look at the essential RTO services Buddy’s success prides itself on:
- No credit needed: Buddy’s provides customers with essential products without a long-term commitment or a credit check.
- Express delivery: Buddy’s store locator allows you to see local pricing on furnishings, appliances and electronics, as well as which items are available for express delivery — 24 hours or less.
- Included service and repair: One of the most convenient aspects of Buddy’s Home Furnishings is that it will service, fix, replace or provide loaner items all for free.
- Flexible payment options: Clients can customize their payment plans and schedules depending on their financial needs.
Why join the furniture industry?
The furniture industry is recession-resistant. Whether customers are minimalists or maximalists, people need furniture in their homes.
The furniture market is multi-billion dollar, with revenue in 2023 at $252.90 billion. In addition, the furniture industry's annual growth is projected at 3.98%.
Why franchise with Buddy’s Home Furnishings?
One of the most important parts of researching a company is understanding the financial commitment it takes to succeed and how much profit you can expect to see. The critical financial requirements and incentives of becoming a Buddy’s franchisee are below.
- Liquid capital: $150,000.
- Minimum net worth: $500,000.
- Total investment: $356,170 - $879,317.
- Initial franchise fee: $39,900.
- Royalty fee: 6%.
- Advertising fee: 2%.
- Veteran incentives: 20% off the franchise fee.
Related: How to Be A Wealthy Franchisee
What will your income be as a Buddy’s Home Furnishings franchise owner? That number varies. However, to give you a better idea of the range franchise locations make, here are some numbers:
- Gross sales: Top 25% of stores see $1,501,500 average gross sales.
- Cash flow per store: $369,627.
- The cash flow earned by franchise owners: 25% on average.
Related: The Role and Responsibilities of a Franchisee, Defined
What to expect when becoming an owner of a Buddy’s Home Furnishings franchise
Buddy’s has been a franchisor for years, and it knows the ropes of how to onboard its franchisees to make them successful.
If becoming a franchise owner seems jarring, remember it may cost just as much, if not more, to start your own small business. Also, Buddy’s offers its franchisees financing that covers the following:
- Franchise fee.
- Startup costs.
- Accounts receivable.
- Payroll costs.
Buddy’s Home Furnishings cares about the path of its new franchisees, so it provides 42 hours of classroom training and 60 hours of on-the-job training. Team members are assigned to help you with the following:
- Site selection.
- Lease negotiations.
- Cyber training with proprietary software systems.
- Safety and security procedures and protocol.
- The grand opening.
- Long-term assistance: Toll-free call center, online support, field operations and consultants for one-on-one help.
- Marketing and promotions: Regional and national advertising, website development, email marketing and SEO.
- Loyalty programs.
- Mobile apps.
Related: Are You an Ideal Franchisee? Here's How to Find Out.
The franchising process with Buddy's Home Furnishings
If you like what you’ve read so far and think Buddy’s could be the right fit for you, then the next thing to do is continue your research and reach out to the company directly.
During the process, expect to meet with corporate leaders, review the Franchise Disclosure Document (FDD), secure financials, receive training and sign a franchise agreement.
Related: The 23 Items Your Franchise Disclosure Document Must Include
If you are unfamiliar with an FDD, it is the contract between you and the franchisor. This will be a legally binding contract with all essential information, including:
- Description of the company and its history.
- Any previous or current litigations.
- Bankruptcy history.
- Patents, copyrights and proprietary information.
- Financial statements and receipts.
- All investment costs and fees.
- Details and products and services.
Related: Ready to Commit? - Franchise License Agreement
Next steps with Buddy's Home Furnishings
If owning a Buddy’s franchise sounds like the right franchise opportunity for you, then it's time to get going.
Remember to weigh the pros and cons, picture yourself as the owner of your franchise, continue researching franchise information and reach out to Buddy's Home Furnishings to get free info and start the process.
Are you looking for more content to learn all about franchising? Explore the Entrepreneur Franchise Center here.
About Buddy's Home Furnishings
|Related Categories||Furniture & Appliances, Miscellaneous Retail Businesses|
|Parent Company||Franchise Group Inc.|
|Leadership||Michael Bennett, CEO|
8529 Southpark Cir., #150
Orlando, FL 32819
More from Buddy's Home Furnishings
Buddy’s Home Furnishings offers customers affordable payments on home necessities including name-brand furniture, electronics, appliances and home accessories. The company is one of the fastest growing rent-to-own franchises in America and sits prominently in the $12.6 billion rent-to-own industry.**
What is Rent-to-Own?
Rent-to-own (RTO) is an essential and recession-resistant industry offering customers affordable payments on everyday necessities, which is why RTO annual revenue has steadily increased for decades despite good and bad economies.
The rent-to-own industry gained traction in the 1970s in response to customer demand for acquiring household products without incurring debt or jeopardizing the family’s credit. RTO customers continue to come from all walks of life and share the common desire to have durable goods in their homes without the long-term financial obligations associated with credit sales.
The cornerstone of RTO, and a point of differentiation from traditional retail, is there is no interest, no credit check and customers can return the merchandise at any time for any reason without penalty. This model has become a mainstream hallmark of consumerism spanning industries from car sharing services, to clothing rental subscriptions, technology trade-in programs and so much more.
According to the 2022 Association of Progressive Rental Organizations (APRO) Annual Industry Health Survey, the RTO industry served an estimated total of 4.6 million households in 2020—approximately 1 of every 28 American households rented products from a traditional brick-and-mortar RTO store.
Why Franchise with Buddy’s Home Furnishings?
There are many benefits to franchising with one of the fastest growing rent-to-own retailers:
60+ Years of Historical Success
Buddy’s level of expertise and success has only compounded with time. Franchise owners benefit from Buddy’s national brand recognition and the tried-and-true, proven systems refined over decades in RTO.
Impressive Unit Economics
On average, the top 25% of stores see $1,467,253 gross sales and $437,295 cash flow per store.*
Recurring Revenue on Inventory
Franchise owners see an average of 25% in free cash flow, which is attributed to the unique recurring revenue model in RTO that yields multiple returns on every product.*
Business Model Built for Franchising
Approximately 90% of Buddy’s franchisees are multi-unit owners and growing, which is a testament to the company’s systematic, proven approach to establishing and scaling stores.
Buddy’s success is a reflection of the relationships every store develops with its local community. The company culture is to nurture relationships with customers that aren’t built on transactions, but rather, trust.
* This information reflects the Average Gross Sales and Average Free Cash Flow for the Top 25% of Buddy’s Home Furnishings company-owned retail businesses which were in operation for the entirety of the 2022 fiscal year. Of the 36 retail businesses that were in operation for all of 2022, 9 were included in the Top 25% sample set and 2 attained or surpassed the Average Gross Sales and 3 attained or surpassed the Average Free Cash Flow as described above. We refer you to Item 19 of our 2023 Franchise Disclosure Document for additional information. A NEW FRANCHISEE’S RESULTS MAY DIFFER FROM THE REPRESENTED PERFORMANCE. This advertisement is not intended as an offer to sell, or the solicitation of an offer to buy, a franchise. Offerings made by prospectus only and in compliance with the applicable pre-sale registration and disclosure requirements in your state. ©2023 Buddy’s Home Furnishings®. All rights reserved. **Courtesy of APRO.
|Franchising Since||2009 (2023-2009 years)|
|# of employees at HQ||75|
This company is offering new franchisees in the following US states: Alaska, Alabama, Arkansas, Arizona, Colorado, Connecticut, District of Columbia, Delaware, Florida, Georgia, Iowa, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Massachusetts, Maryland, Maine, Michigan, Missouri, Mississippi, Montana, North Carolina, North Dakota, Nebraska, New Hampshire, New Jersey, New Mexico, Nevada, New York, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Vermont, Washington, West Virginia, Wyoming
|# of Units||338 (as of 2023)|
Information for Franchisees
Here's what you need to know if you're interested in opening a Buddy's Home Furnishings franchise.
Financial Requirements & Ongoing Fees
Here's what you can expect to spend to start the business and what ongoing fees the franchisor charges throughout the life of the business.
Initial Franchise Fee
Definition: The initial fee paid to a franchisor to join their system
What you need to know: Found in Item 5 of the FDD, this may be a flat fee, or may vary based on territory size, experience, or other factors.The franchise fee is an up-front (one-time) cost that a new franchisee pays to the franchisor. This fee is usually due at the signing of the franchise agreement and covers the right to use the franchisor's trademarks, name, and related business systems.
Definition: The total amount necessary to begin operation of the franchise
What you need to know: The initial investment includes the franchise fee, along with other startup expenses such as real estate, equipment, supplies, business licenses, and working capital. This is outlined in a chart in Item 7 of the FDD, showing a range of possible costs from low to high.
|$356,170 - $879,317|
Net Worth Requirement
Definition: The minimum net worth you must have in order to qualify to become a franchisee of this company
What you need to know: Net worth is the value of a person's assets minus liabilities. Assets include cash, stocks, retirement accounts, and real estate. Liabilities include items like mortgages, car payments, and credit card debt.
Definition: The minimum liquid capital you must have available in order to qualify to become a franchisee of this company.
Definition: A discount or other incentive offered to military veterans who buy a franchise with this company.
|20% off franchise fee|
Definition: A ongoing fee paid to the franchisor on a regular basis.
What you need to know: Most franchisors require franchisees to pay an ongoing royalty fee, which is detailed in Item 6 of the FDD. This fee is typically a percentage of weekly or monthly gross sales, but may also be a flat weekly, monthly, or annual fee.
Ad Royalty Fee
Definition: An going fee paid to the franchisor on a regular basis to support advertising or marketing efforts.
What you need to know: This may also be called advertising fee, marketing fee, brand fund fee, and more, but the basic purpose is the same-- to support promotion of the brand systemwide. As with the royalty fee, it is detailed in Item 6 of the FDD, and can be a percentage of weekly or monthly gross sales or a weekly, monthly, or annual fee.
Term of Agreement
Definition: The length of time your franchise agreement will last.
What you need to know: Franchise terms are typically anywhere from 5 to 20 years in length, but are sometimes instead dependent on factors such as the term of your lease. Once your term is up, you may have the option to renew your agreement, typically for a smaller fee than the original franchise fee.
|Is franchise term renewable?||Yes|
Some franchisors offer in-house financing, while others have relationships with third-party financing sources to which they refer qualified franchisees.
|Third Party Financing||Buddy's Home Furnishings has relationships with third-party sources which offer financing to cover the following: franchise fee, startup costs, equipment, inventory, accounts receivable, payroll|
Training & Support Offered
Franchisors offer initial training programs and a variety of ongoing support options to help franchisees run their businesses.
|On-The-Job Training||60 hours|
|Classroom Training||42 hours|
Meetings & Conventions
Security & Safety Procedures
Franchisee Intranet Platform
Additional details about running this franchise.
|Is absentee ownership allowed?||Yes|
Can this franchise be run from home/mobile unit?
Definition: The business can be run from your home and/or a vehicle, and it is not necessary to have a retail facility, office space, or warehouse.
Can this franchise be run part time?
Definition: This business can be run by the owner on a part-time basis (less than 40 hours per week) and/or as a side business; it is not necessary for the business to be open/run full-time.
Are exclusive territories available?
Definition: An exclusive territory is a fixed area in which you are given the right to operate and in which no other units of the same franchise may be opened.
What you need to know: Territory size may be based on factors such as radius, population size, zip codes, and more. Details can be found in Item 12 of the FDD.
Franchise 500 Ranking History
Compare where Buddy's Home Furnishings landed on this year's Franchise 500 Ranking versus previous years.
Curious to know where Buddy's Home Furnishings ranked on other franchise lists? Find out below.
Ranked #242 in 2023
Entrepreneur’s 44th annual Franchise 500® ranking shines a light on the unique challenges and changes that have shaped the franchise industry over the last year—and how franchisors have adapted and evolved to meet them.
Ranked #113 in 2023
Meet the companies that are leveraging their ability to scale fast across the U.S. and Canada in Entrepreneur's annual fastest-growing franchises ranking.
Related Franchise Content
Catch up on the latest franchise news, trends, and more.
What Makes Scenthound a Top New & Emerging Franchise
Focusing on out what dogs and their owners actually need helped Scenthound CEO Tim Vogelcreate a successful franchise system.
How to Harness the Power and Money of a Crowd Through Crowdfunding
You don't have to be rich, succumb to ever-growing interest rates, run the risk of your bank collapsing or use your house as collateral to build a franchise. All you have to do is find the right crowd.
Woman Ties the Knot at White Castle Almost 30 Years After the Chain Gave Her Free Food as a Homeless Teen
Jamie West was just 12 years old when she ran away from the foster care system.
Franchise Ownership Made Easy: Best Practices for Managing and Growing Your Business
Using these tips, you can maximize the benefits of franchise ownership and take your business to the next level.
Florida Burger King to Pay $8 Million to Customer Who Slipped and Fell in Restaurant Bathroom
The case marks one of the largest slip-and-fall verdicts in Florida's history.
6 Things to Consider When Getting Out of a Franchise Agreement
Want to get out of your franchise agreement? Here are six things to consider