Franchise Times released its annual Top 400 list, with the five companies that topped the list last year still holding onto those top spots. Ace Hardware kept the No. 5 position it had achieved in 2022, ranking behind Burger King, KFC, McDonald’s and 7-Eleven.
The Franchise Times’ Top 400 List is an annual ranking of the 400 largest franchise systems in the U.S. by global systemwide sales, based on the previous year’s performance. Ace Hardware posted $23.1 billion in retail sales, equaling a 3.4% increase from the prior year. The record sales results were driven by an increase in market share and continued new store growth.
Ace Hardware opened 168 new domestic locations and 232 total new locations worldwide in 2022 for a 2.9% unit growth. The company operates as a retailer-owned cooperative where independent owners operate most locations. Ace “franchisees,” or retailers, own their individual stores and are also shareholders in the organization. At Ace, year-end profits are distributed back to the local owners as a patronage dividend. The patronage dividend in 2022 was a record $345 million.
Unlike a traditional franchise operation, Ace Hardware store owners pay no royalty fees or ongoing franchise fees. Ace Hardware attributes its continued growth to a number of successful initiatives, including employee training, marketing support and e-commerce.
“Ace is honored to be recognized by Franchise Times as one of the top franchises in 2023, in the top 5 and the highest ranked retailer on this impressive list,” says John Kittell, vice president, Retail Operations and New Business at Ace Hardware Corp. “We remain focused on continuously improving the economics of our store model to help entrepreneurs open stores, serve their neighbors and invest in their communities, which we have successfully accomplished with over 900 stores opened in the past five years alone.”