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How much does a franchise cost?

Sarah Stowe

When you want to buy a franchise it pays to have a sense of how much money you can access to invest, and how much a franchise will cost you.

The upfront fee for a franchise will vary considerably depending on a number of factors. For starters the type of business you choose will dictate whether or not this is an entry level cost or a high investment. Typically service franchises – either home based or mobile – will offer a business opportunity for those on a smaller budget – ranging from $5,000 to $150,000.

This could range from cleaning and home maintenance businesses through to financial advice and mortgage broking, from educational franchises to business services and aged care.

A fitness franchise could fit into this category if it is mobile; a gym-based business will require a much bigger investment.

Hugely popular but requiring deeper pockets, the food retail sector can provide a franchise opportunity from $150,000 to $1m+.

Whatever the industry chosen, prices will still vary according to the complexity of the business on offer, whether or not you are purchasing an existing business, whether the site is a prime location or a smaller entry model like a retail kiosk. If there is equipment or a vehicle to be leased, you may need to add that to the investment.

There may be shop fitting and stock costs to take into consideration. Is a uniform part of the fee?

Some franchises include all the elements of training and support in the package – others ask franchisees to add in training costs.

Then there are incidental payments to make around the pre-opening day – perhaps accommodation or flights are required to attend training or inductions; and all the costs around leasing premises if required.

It’s easy to forget about the behind-the-scenes costs too: legal and accounting advice, business registration for instance.

The costs of running a business – such as tax and superannuation – can also be overlooked when newbie franchisees are setting up.

The easiest way to ensure all your costs are going to be included in your budget and to ensure no nasty surprises, is to speak to a franchise-friendly accountant.

Do you know your investment level? Take a look now at some of the franchises for sale right now. You can use our filter to shortcut your search to your budget.

Do you need to find finance? Read this first.