How much does it cost to open a franchise?

Short answer

Opening a franchise costs $50,000–$750,000 all-in depending on format. Home and van-based franchises start near $50,000–$120,000; a fitness studio runs $250,000–$600,000; a drive-thru quick-service restaurant commonly exceeds $1M once land and build-out are included.

All-in opening cost by franchise format

Format	Total investment	Franchise fee
Home-based service	$45K–$120K	$20K–$40K fee
Van / mobile	$90K–$220K	$25K–$45K fee
Retail kiosk	$130K–$300K	$25K–$40K fee
Fitness studio	$250K–$600K	$40K–$60K fee
Fast-casual restaurant	$400K–$1.1M	$35K–$50K fee
QSR with drive-thru	$900K–$2.5M	$45K–$60K fee

How to read this table

Fitness studio sits at the top of the table ($250K–$600K) — $40k–$60k fee. If your situation looks like this row, plan against the upper half of the range rather than the midpoint.
Home-based service anchors the bottom ($45K–$120K) — $20k–$40k fee. Treat this as the conservative case you should still be profitable at.
The gap between the top and bottom row is roughly 13×. That spread is why a single blended average is close to useless here — pick the row that matches your setup instead of averaging the column.
Most rows are ranges, not single figures. The low end usually reflects a weaker month, a softer audience geography, or an unoptimised setup; the high end reflects a well-run, well-targeted operation of the same size.
With 6 reference points in the "all-in opening cost by franchise format" table, the fastest way to use this page is to find the closest row, take its total investment, then stress-test it ±30% before you build a plan on it.

Context

The franchise fee is the smallest line in almost every deal — usually 5–10% of the total. Build-out, equipment and signage dominate, and they have inflated faster than franchisor disclosures update. The most commonly underestimated line is working capital: a unit that opens with no cash buffer fails during the ramp period even when the underlying economics are fine. Budget three to six months of full operating cost on top of the build, and treat any FDD range as a floor rather than a midpoint in high-cost metros.

What moves this number

Royalty and ad-fund load

Royalties of 4–8% plus a 1–3% brand fund come off gross revenue before any operating cost, so they compress margin hardest in low-margin formats.

Build-out debt service

Loan repayment on the initial investment is the difference between a unit that looks profitable and an owner who takes home nothing. Amortisation term matters as much as rate.

Owner-operator versus absentee

An owner working the floor replaces a manager salary worth $45,000–$70,000 a year. Absentee units report materially lower take-home for the same revenue.

Unit count and shared overhead

The second and third units share management, purchasing and admin, so incremental profit per unit rises even when revenue per unit is flat.

Methodology

FDD Item 7 initial-investment ranges across major franchise categories, adjusted for 2026 construction and equipment costs, with working capital normalised to four months of operating expense.

Assumptions and caveats

Franchise Disclosure Document figures describe existing units, not a projection for a new one.
Ranges exclude the owner's own labour unless the row explicitly costs a manager salary.
This page was last reviewed on 2026-08-12. Ranges are updated as new data lands, so re-check before using them in a contract or a plan.
Use these numbers as a starting range, not a guarantee — your own historical data always beats a benchmark.

Frequently asked questions