Local Ownership, National Brands: How Franchising is a Pathway to Entrepreneurship

The House Committee on Small Business held a hearing titled "Local Ownership, National Brands: How Franchising is a Pathway to Entrepreneurship" on January 23, 2026. The discussion focused on the critical role franchising plays in fostering entrepreneurship and economic growth, highlighting that franchises employ nearly 9 million people and contribute significantly to the U.S. GDP. Witnesses, including franchise owners from various sectors such as hospitality, fitness, and food service, shared personal stories emphasizing franchising as a pathway to business ownership, especially for veterans and immigrants. Key topics included the need for regulatory clarity, particularly regarding the joint employer standard, which affects franchise operations and relationships. The bipartisan American Franchise Act was frequently mentioned as a legislative solution to provide stability and protect the franchise business model. Challenges such as rising tariffs, increased costs of materials and healthcare, and access to capital were discussed as significant hurdles impacting franchise owners' ability to grow and sustain their businesses. The hearing underscored the importance of supporting small business owners through predictable policies, improved access to financing, and recognition of franchising's unique business structure to ensure continued job creation and community investment.