Any particular industries? And what's the location? Different stuff works well in different areas...
I have over a dozen large franchise chains as current clients plus quite a few as ex-clients, so I've learned a lot about the industry over the last several years. Profitability varies widely by industry and franchise chain, but here are a few things you might find useful:
-In-home care franchises have pretty high ROIs, on average. They provide non-medical care to people who aren't quite independent but who can live at home with a little extra help. You get much of the profit of nursing homes without the reputation problem or many of the ugly regulations. You also get to work with people who are of a slightly higher caliber than the average fast food employee.
-Research suggests that the larger brand names are the worst deals when it comes to restaurant franchises. I can't remember where I saw the study, but I'll come back and add it if I think of it. They tend to charge way more for their franchise fees and royalties because you're "getting a proven brand". Smaller regional franchises that have a name in their area are often better deals. The big name franchises generally work better for the larger franchisees.
They're often private equity-backed, and they can negotiate better deals than your dad could as a one unit investor.
-SBA loan failure rate is a matter of public record, and you can find this info
nicely organized by franchise. Note that this doesn't include non-SBA funding sources or any of the franchisees who bankrupt themselves to keep their businesses afloat.
-If your dad has an entrepreneurial personality, he probably shouldn't invest in a franchise. It's a formula where you carry out someone else's vision, not an entrepreneurial venture. On the other hand, they can be ok for people who don't mind a good amount of risk, generally modest returns, and a lot of work. He also shouldn't discount how crappy it can be to work, day in and day out, with minimum wage employees (depends on the type of franchise, of course).
There are franchises where they don't require you to be present in the day-to-day business, but a lot of people have told me those also have lower returns and lower success rates (on average). I don't have first-hand data on that, but it would make sense in cases where you're off-site but not big enough to have economies of scale and better negotiating power.
-Watch out for the "my friends all think this is a good idea" franchises. Frozen yogurt has been crazy hot for a few years now, but some areas have a shop on every other corner. Who knows if it will be so hot 5 years from now. If everyone's talking about it, there's a good chance the market is already getting kind of crowded. Full disclosure - I do franchisee lead gen for 3 major chains in this market. This has been one of the highest search volume franchise types for at least a couple years now. It's a good investment for some people, but don't go in with blind optimism and the assumption that it will always be this hot.
Overall, I would advise against franchise investments for MOST people and situations - especially if failure would mean financial ruin/delayed retirement. It works well for some people or the business model wouldn't still be around...but failure rates are high and a lot of people end up disillusioned and/or broke.
Also - I would skip the "franchise consultant" recommendation. Most of them are paid by the franchises to bring in highly qualified leads. Few, if any, are going to give an unbiased opinion.
TLDR - Just give Jon the money already. I'm sure it will find its way over there eventually.
