How long until a franchise is profitable? Most break even in 12-24 months and repay the full investment in 2-5 years. See 2026 timelines by industry.
Quick answer As of September 2026, the profit figures in franchisors' own FDDs put payback between about 10 months and 131 months. i9 Sports' $80,173 median operating profit repays its $64,900 Item 7 midpoint in 10 months; Popeyes' $236,161 average EBITDA needs 131 months to cover $2,572,645. Seven of ten brands take over four years, before debt service.
About 10 months at the fast end and about 131 at the slow end, measured on the profit franchisors report themselves. Ten brands publish an Item 19 profit line (EBITDA, four-wall EBITDA or operating profit) that can be set against their Item 7 investment. The median of the ten is 55 months, and only three repay the capital inside three years.
Payback below is the Item 7 midpoint divided by the brand’s disclosed annual profit. No margin is assumed: both inputs come from the filing.
| Brand (FDD year) | Item 7 range (midpoint) | Item 19 profit measure and population | Annual profit used | Payback |
|---|---|---|---|---|
| i9 Sports (2026) | $59,900-$69,900 ($64,900) | Median operating profit, 129 franchised units, Oct. 2024 to Sept. 2025 | $80,173 | 10 months |
| Options Home Care (2026) | $113,900-$178,500 ($146,200) | Median EBITDA, 2025, franchisees open at least 3 years (count not disclosed) | $156,988 | 11 months |
| Goddard School (2026) | $1,003,500-$1,503,000 ($1,253,250), leased school built by the landlord | Median EBITDA, 2025, 620 franchised schools open more than 18 months | $474,693 | 32 months |
| Take 5 Oil Change (2025) | $912,248-$2,053,642 ($1,482,945), ground-up center, excludes real estate | Median 4-Wall EBITDA, fiscal 2024, 298 affiliate-owned centers restated to franchisee costs | $340,178 | 52 months |
| Sport Clips (2026) | $226,800-$580,500 ($403,650) | Median operating profit, 2025, 73 company-owned stores, less royalty and training fee | $91,857 | 53 months |
| Planet Fitness (2026) | $1,282,500-$5,386,000 ($3,334,250), excludes real estate | Average EBITDA, 2025, 262 corporate-owned clubs | $696,572 | 57 months |
| Anytime Fitness (2026) | $539,329-$905,482 ($722,406) | Median EBITDA after manager salary, 11 company-owned centers restated to franchisee costs | $120,509 | 72 months |
| Firehouse Subs (2026) | $405,350-$875,950 ($640,650), in-line | Median restaurant-level EBITDA, 2025, 704 franchised restaurants | $95,743 | 80 months |
| Camp Bow Wow (2026) | $954,606-$1,229,536 ($1,092,071) | Median EBITDA, 2025, 207 franchised camps open at least 24 months | $145,680 | 90 months |
| Popeyes (2026) | $1,222,045-$3,923,245 ($2,572,645), free-standing, excludes real estate | Average EBITDA, 2025, 2,007 franchised free-standing restaurants | $236,161 | 131 months |
Source: Items 7 and 19 of each brand’s FDD, filing year in parentheses. Payback months = Item 7 midpoint ÷ annual profit × 12. VetMyFranchise analysis, September 2026.
Read what each profit line leaves out before you lean on a row:
“Twelve to twenty-four months” is the answer most sources give, and it averages businesses that behave nothing alike. On disclosed profit, i9 Sports and Options Home Care beat it, and Goddard School is the only other brand under three years. Service businesses with small build-outs clear their capital fastest. Fitness, which looks worst on revenue alone, sits mid-table once a real expense statement replaces an assumed margin. Restaurants stay at the slow end even with a profit line in hand.
Most franchisors stop at revenue. For those brands the fallback is the Item 7 midpoint divided by the Item 19 median unit revenue, at an assumed 15% net margin. Both inputs are disclosed; the margin is not.
| Brand (FDD year) | Item 7 midpoint | Item 19 median | Units in sample | Payback at 15% net margin |
|---|---|---|---|---|
| Home Instead (2026) | $221,595 | $2,352,451 | 611 | 8 months |
| Right at Home (2026) | $135,284 | $1,334,579 | 390 | 8 months |
| i9 Sports (2026) | $64,900 | $359,546 | 213 | 14 months |
| Stanley Steemer (2026) | $342,715 | $1,179,370 | 208 | 23 months |
| Mr. Handyman (2026) | $188,450 | $580,422 | 57 | 26 months |
| Merry Maids (2025) | $148,495 | $427,425 | 306 | 28 months |
| Wingstop (2026) | $679,450 | $1,890,866 | 2,116 | 29 months |
| Wild Birds Unlimited (2026) | $304,013 | $780,955 | 326 | 31 months |
| Jackson Hewitt, standard offices (2025) | $88,025 | $133,435 | 1,525 | 53 months |
| Great Clips (2026) | $303,850 | $390,685 | 4,158 | 62 months |
| Sport Clips (2026) | $403,650 | $416,189 | 1,645 | 78 months |
| Crumbl (2026) | $1,160,549 | $1,093,071 | 776 | 85 months |
| Burger King (2026) | $2,784,900 | $1,593,606 | 4,730 | 140 months |
| Anytime Fitness (2026) | $722,406 | $398,982 | 1,683 | 145 months |
Eight months to a hundred and forty-five, from the same formula, on documents filed in the same year. Fifteen percent is a generous net margin for most of these categories, and the column scales cleanly: at 10% every figure multiplies by 1.5, at 20% it drops by a quarter. Three of these brands also appear in the profit table, and the comparison shows how much the assumed margin moves the answer: i9 Sports goes from 14 months to 10, Sport Clips from 79 to 53, and Anytime Fitness from 145 to 72.
Where profit is not disclosed, time to payback comes down to one relationship: how much annual revenue a unit produces relative to how much capital it took to open. Both figures are disclosed. Item 7 gives the estimated initial investment as a range, and its total is the same number our guide to what it costs to open a franchise breaks down line by line. Item 19 gives unit revenue, where the franchisor chooses to disclose it. Divide the second by the first and you get a ratio that predicts payback far better than the industry label on the brochure.
We ran that division across our FDD library. Of 2,129 analyzed FDDs, 1,456 contain an Item 19 at all, and only 575 disclose a usable median unit revenue figure. After filtering to disclosures our extraction judge marked as supported, with a reported sample of at least 10 units, 459 brands remained (406 from 2026 filings, 53 from 2025).
| Question | Answer | Basis |
|---|---|---|
| Fastest category to repay Item 7 | Senior care, at 6.91x Item 19 revenue to Item 7 midpoint, about 12 months | 25 brands |
| Slowest category | Fitness and wellness, at 0.93x, about 86 months | 39 brands |
| Brands needing a net margin above 20% for a 24-month payback | 330 of 459 (71.9%) | 459 FDDs |
| Brands needing above 25% | 290 of 459 (63.2%) | 459 FDDs |
| Item 19 tables that screen out new or non-qualifying units | At least 141 of 459 (30.7%) | Item 19 segment lines |
| Median royalty and ad fund across the brands analyzed | 6.0% and 2.0% of sales | Items 5 and 6 |
Source: Item 7 and Item 19 of 459 current FDDs, VetMyFranchise analysis, August 2026.
The ratio answers when the capital comes back. It does not answer two questions sitting right next to it. Whether the median unit is a fair proxy for your unit is covered in our breakdown of what franchise owners actually make. Whether the brand lasts long enough for the ratio to matter is in the franchise failure rate data, where the median system closes 4.7% of its franchised units a year.
The spread is not subtle.
Each row divides the brand’s Item 19 median unit revenue by the midpoint of its Item 7 range, then reports the category median. The right-hand column inverts it into a testable question: what net margin would a unit have to clear to return the entire Item 7 midpoint in 24 months, assuming full-strength revenue from day one?
| Category | Brands | Item 19 median ÷ Item 7 midpoint | Payback at 15% margin | Payback at 10% margin | Net margin needed for 24-month payback |
|---|---|---|---|---|---|
| Senior Care | 25 | 6.91x | 12 months | 17 months | 7.2% |
| Home Services | 69 | 3.04x | 26 months | 39 months | 16.5% |
| Cleaning & Maintenance | 37 | 2.60x | 31 months | 46 months | 19.3% |
| Financial Services | 8 | 2.55x | 31 months | 47 months | 19.6% |
| Automotive | 9 | 2.24x | 36 months | 54 months | 22.4% |
| Retail | 29 | 1.98x | 40 months | 61 months | 25.2% |
| Business Services | 19 | 1.64x | 49 months | 73 months | 30.5% |
| Pet Services | 12 | 1.42x | 56 months | 85 months | 35.2% |
| Child Services & Education | 30 | 1.17x | 68 months | 103 months | 42.6% |
| Food & Beverage | 129 | 1.17x | 68 months | 103 months | 42.6% |
| Health & Beauty | 29 | 1.08x | 74 months | 111 months | 46.2% |
| Fitness & Wellness | 39 | 0.93x | 86 months | 129 months | 53.6% |
The three right-hand columns are a model, not a disclosure. They contain exactly two inputs, both FDD-sourced: the Item 7 midpoint and the Item 19 median. They assume no ramp, no debt service, and no owner draw, all of which make real payback slower. Read them as a ceiling on optimism rather than a forecast.
Read it that way and the standard answer collapses. Repaying Item 7 in 24 months would require a net margin above 20% at 330 of the 459 brands, or 71.9%. Above 25% at 290 of them. A senior care or home services buyer can hit the 12-24 month range on plausible economics. A fitness buyer is being told a timeline that would require keeping more than half of every revenue dollar as profit.
The ordering survives the most generous possible reading. Run the same calculation against the low end of each Item 7 range rather than the midpoint, treating every buyer as the cheapest possible build, and fitness and wellness still needs 37.5%, food and beverage still needs 22.9%, and senior care drops to 5.3%.
Category is one lens. Capital is the other, and it moves in the opposite direction from what most first-time buyers assume.
| Item 7 midpoint | Brands | Median Item 7 midpoint | Median Item 19 revenue | Ratio | Net margin needed for 24-month payback |
|---|---|---|---|---|---|
| Under $100K | 40 | $63,700 | $146,685 | 2.44x | 20.5% |
| $100K-$250K | 136 | $177,368 | $472,596 | 2.77x | 18.1% |
| $250K-$500K | 98 | $367,574 | $601,104 | 1.66x | 30.1% |
| $500K-$1M | 96 | $702,088 | $923,494 | 1.27x | 39.5% |
| $1M+ | 89 | $1,631,875 | $1,593,606 | 0.85x | 58.8% |
Ratio is the median of each brand’s own Item 19 median divided by its own Item 7 midpoint, not the ratio of the two column medians.
Revenue does not scale with capital. Moving from the $100K-$250K tier to the $1M+ tier multiplies the money at risk by roughly 9x while multiplying median unit revenue by roughly 3.4x. The ratio falls from 2.77x to 0.85x, and the required margin more than triples. That is the same finding, from the other direction, as our look at low versus high investment franchise returns.
Note also that the franchisor’s cut does not fall to compensate. Median royalty runs 7.2% in the cheapest tier and 5.0% in the most expensive, with a median ad fund of 2.0% in every tier. The largest investments carry the thinnest revenue coverage and a near-identical fee load.
Every figure below is from the brand’s most recent FDD in our library. Item 7 is the disclosed investment range, Item 5 the initial franchise fee, Item 6 the ongoing royalty and ad fund, Item 19 the disclosed median with its reported sample and unit population.
Ratio: 10.62x. At a 15% net margin the Item 7 midpoint comes back in roughly 8 months, and at 10% in roughly 11. A 4.7% margin would still clear it inside 24. The franchisor’s 7% take at that median is $164,672 a year, which is real money, and the unit still clears the payback test on thin margins because revenue dwarfs the capital required. Senior care franchises top the category table for the same structural reason: the model is labor, not build-out. See the full Home Instead FDD breakdown.
One caution on that median. The 2025 filing reported $2,261,503 across 603 businesses, and the two figures circulate interchangeably. The 2026 number above is the current one.
Ratio: 3.08x. Payback lands near 26 months at a 15% net margin and 39 months at 10%, and a 16.2% margin repays the midpoint in 24. Royalty and ad fund together take $52,238 a year at that median.
This one is worth slowing down on, because the number quoted almost everywhere for Mr. Handyman is $972,424, and it is not a unit figure. That is the median for the 2-Unit Franchisees Group: 67 franchisees operating 134 territories between them. Divide it by the two units it describes and you are back near the single-unit median. Buying one territory and modeling it on a two-territory owner’s revenue nearly doubles the assumed payback speed. Read the group label above the row before you take the number. More at Mr. Handyman and in our home services franchise guide.
Ratio: 1.29x. Payback runs about 62 months at a 15% net margin and about 93 months at 10%, and a 38.9% margin would be required to do it in 24. Meanwhile 11% of every revenue dollar is contractually spoken for before rent, payroll, or product: $42,975 a year at the disclosed median.
This is the most instructive row in the dataset because Great Clips is widely described as a simple, low-drama, accessible franchise, and the sample is 4,158 salons rather than a handful of stars. The concept is not the problem. The ratio is. Full data on the Great Clips FDD page.
Ratio: 0.55x. At a 15% net margin the Item 7 midpoint takes roughly 145 months to come back, and returning it in 24 would require a 90.5% net margin. No franchise category operates there. The disclosure does report quartiles, and even the top quartile of those centers, averaging $746,996 in total revenue, still needs a margin above 48% for a two-year payback.
Section III of the same Item 19 narrows the gap. Eleven company-owned centers, with expenses restated to what a franchisee would pay, show a median EBITDA of $120,509 after a manager’s base salary, on median revenue of $461,254. That repays the $722,406 midpoint in about 72 months. Those 11 centers opened between 2005 and 2015 and out-earn the franchised median, so read 72 months as the better case, not the typical one. Either way this is a multi-year payback asset, and any conversation that starts at “12 to 24 months” is describing a different business. Anytime Fitness detail, and the brand’s economics side by side with Planet Fitness in Anytime Fitness vs Planet Fitness.
Every revenue-based figure on this page rests on an assumed net margin, which is the fair criticism of this kind of analysis. The ten brands in the first table remove that assumption because their Item 19 includes an expense statement, not revenue alone. How each one builds its profit line decides how far you can lean on it.
i9 Sports, in its 2026 FDD, publishes a franchisee income statement for 129 Included Franchises covering October 2024 through September 2025. Average revenue is $514,066 against 29% cost of goods, 38% operating expense and a 7.5% royalty, leaving an average operating profit of $129,290, or 25% of revenue. The median operating profit is $80,173. Set that against the $64,900 Item 7 midpoint and the capital returns in about 10 months. The disclosure states plainly that operating profit excludes owner compensation, so treat it as a return on capital rather than a salary.
Sport Clips, in its 2026 FDD, publishes an expense report for 73 company-owned stores in calendar 2025. Its median column shows net sales of $473,197 with payroll at 46%, occupancy at 15%, advertising at 5%, variable costs at 6% and miscellaneous at 2%, leaving operating profit of $126,281, or 26.7%. That figure is explicitly before royalties and weekly training fees. Deduct the 6% royalty and the training fee and about $91,857 is left, which repays the $403,650 midpoint of its $226,800 to $580,500 investment range in roughly 53 months. (The FDD’s cover page gives that $226,800 low end; its Item 7 total row prints $236,800, which would not change the result.) Sport Clips also discloses a real cost figure: “The median investment to open one Sport Clips store during the previous calendar year was $399,757.” Against that number it is roughly 52 months.
Two caveats on the Sport Clips figure, both of which cut in the same direction. The expense table covers 73 company-owned stores, not franchised ones. And the revenue median elsewhere in the same Item 19 describes “1,645 mature stores (with more than 2 years in operations),” which excludes exactly the ramp period a new buyer is asking about.
Firehouse Subs and Popeyes, both in 2026 filings, build EBITDA from franchisee profit and loss statements, with royalties, ad fund and occupancy already deducted. Firehouse’s 704 reporting restaurants show a median EBITDA of $95,743 on median sales of $986,432, a 9.7% margin. Popeyes reports by sales band: free-standing restaurants under $1.5 million in sales averaged $41,234 of EBITDA, and those above $2.5 million averaged $547,990. Within one brand, the sales band moves EBITDA by a factor of more than 13. Both are covered in more depth in the Firehouse Subs Item 19 deep dive and the Popeyes Item 19 deep dive.
Want this run for the brand you are actually considering? The 12-section FDD analysis pulls Item 7, Items 5 and 6, and the full Item 19 table into one payback model with a buyer verdict for your capital position: $49 per brand, or compare ratios across 2,000+ franchises first.
The most persistent myth in this category is that low investment equals quick payback. The data does not support it as a rule, only as a tendency, and the exceptions are large.
| Brand (FDD year) | Item 7 midpoint | Item 19 median | Sample | Ratio | Payback at 15% margin | Margin needed for 24 months |
|---|---|---|---|---|---|---|
| i9 Sports (2026) | $64,900 | $359,546 | 213 units | 5.54x | 14 months | 9.0% |
| Wingstop (2026) | $679,450 | $1,890,866 | 2,116 units | 2.78x | 29 months | 18.0% |
| Jackson Hewitt kiosks (2025) | $29,200 | $49,630 | 1,138 offices | 1.70x | 47 months | 29.4% |
| Jackson Hewitt standard offices (2025) | $88,025 | $133,435 | 1,525 offices | 1.52x | 53 months | 33.0% |
| Sport Clips (2026) | $403,650 | $416,189 | 1,645 units | 1.03x | 78 months | 48.5% |
Jackson Hewitt is split into two rows on purpose, and the split is the lesson. Its 2025 FDD carries separate Item 7 tables for standard offices ($71,050 to $105,000) and kiosks ($14,900 to $43,500), and a separate Item 19 median for each: $133,435 across 1,525 standard offices, $49,630 across 1,138 kiosks, $86,880 across all 2,663. Blending the kiosk floor with the standard-office ceiling produces a $59,950 “midpoint” for a store format that does not exist, and pairing it with the all-office median compares a cost from one business to a revenue from another. Read the two formats separately or the number is meaningless.
Take the standard-office row and the point still holds. i9 Sports costs $23,125 less and covers 3.6x more revenue per dollar invested. Wingstop costs roughly 7.7x as much and still returns capital 24 months faster, because its median unit clears $1.89 million. Sport Clips costs 4.6x as much and lands 26 months slower.
Jackson Hewitt’s royalty is disclosed as 3.0% to 15.0% with a 6.5% ad fund on Gross Volume of Business, so at the high end the franchisor’s share alone approaches a fifth of revenue. i9 Sports takes 7.5% plus 2%, or $34,157 a year at its median. Same investment tier, entirely different math. If speed is the priority, screen on the ratio, not the sticker. Our roundup of quick-payback franchises applies exactly this filter, and the most profitable franchises to own are frequently not the fastest.
This is where most payback estimates quietly break, and it is the single most useful thing to check before you trust any timeline.
Of the 459 brands analyzed, at least 141 (30.7%) restrict their reported Item 19 population with a maturity or qualification screen. The exact language matters:
Every one of those phrases removes the exact units you are asking about. A median calculated on stores with more than two years of operations tells you where you might land after the ramp, not what you will earn during it. Applying that median to month one overstates first-year cash flow, and every dollar of that overstatement pushes the real payback date later than the model says. The profit disclosures carry the same screen: Goddard’s EBITDA covers schools open more than 18 months, and Camp Bow Wow’s covers camps open at least 24.
One brand publishes the size of the gap, which makes it the best available evidence on what a first year actually looks like. Wild Birds Unlimited’s 2026 FDD reports a median first-12-months Gross Sales of $327,466 and a median second-12-months figure of $378,576, against the $780,955 median for stores open at least 24 months. Year one runs at 42% of the mature number and year two at 48%. Apply the mature median to month one and you have understated the payback period by years, not months.
Two habits fix this. First, read the segment line before the number. Second, prefer brands that break Item 19 out by unit age or tenure cohort, because the gap between the first-year cohort and the mature cohort is your ramp curve drawn from the franchisor’s own data. Our year-one Item 19 benchmarks and the guide to building a pro forma from the Item 19 tables both work from that cohort split.
Where a franchisor discloses real quartile boundaries, the distribution around the median is wide enough to move payback by years.
| Brand | 25th percentile | Median | 75th percentile | Sample |
|---|---|---|---|---|
| Budget Blinds (FDD 2026) | $340,525 | $522,826 | $921,140 | 282 single-territory franchisees |
| Merry Maids (FDD 2025) | $253,140 | $427,425 | $644,057 | 306 |
| Club Pilates (FDD 2026) | $814,100 | $978,300 | $1,138,100 | 1,005 |
| Dunkin’ (FDD 2026) | $952,914 | $1,297,694 | $1,703,007 | 7,010 |
Budget Blinds’ 75th percentile is 2.7x its 25th, and single-territory sales in that same disclosure run from $53,370 to $9,336,975. Modeling your payback off the median implicitly assumes you land in the middle of that distribution. Ask existing franchisees in your market which quartile the local units fall into before you accept the middle as your plan.
Read the row labels before the numbers, because franchisors do not all mean the same thing by “quartile.” Auntie Anne’s 2026 disclosure reports its 489 enclosed-mall franchises in quartiles whose medians run from $415,718 at the bottom to $999,588 at the top, against an overall median of $732,705, while the headline low and high of $103,731 and $2,939,851 describe two individual stores rather than percentile boundaries. Marco’s discloses cumulative cohorts instead: the top 250 of its 997 stores have a median of $1,213,859 against $832,403 for all 997. Neither format is wrong, and both get misread as quartiles constantly.
Royalty and ad fund are the two payback inputs buyers most often treat as rounding errors. In dollars, at each brand’s own Item 19 median, they are not.
| Brand | Royalty | Ad fund | Combined | Annual cost at Item 19 median |
|---|---|---|---|---|
| Wingstop | 6% | 5.5% | 11.5% | $217,450 |
| Burger King | 4.5% | 4.5% | 9.0% | $143,425 |
| Dunkin’ | 5.9% | 5.0% | 10.9% | $141,449 |
| Crumbl | 8% | 2% | 10.0% | $109,307 |
| Club Pilates | 8% | 2% | 10.0% | $97,830 |
| Mr. Handyman | 7% | 2% | 9.0% | $52,238 |
| Sport Clips | 6% | 5% | 11.0% | $45,781 |
| Great Clips | 6% | 5% | 11.0% | $42,975 |
| Wild Birds Unlimited | 4% | 1% | 5.0% | $39,048 |
| Merry Maids (FDD 2025) | 7% | 1.3% | 8.3% | $35,476 |
| Budget Blinds | 3.5% | $1,000 a month (Tier 1 territory) | 5.8% | $30,299 |
All rows come from each brand’s 2026 filing except Merry Maids, which uses the 2025 FDD covering calendar 2024; its 2026 filing regroups Item 19 by quartile and ownership group. Budget Blinds and Wingstop differ by a factor of about 2 on combined rate and by about $187,000 a year in absolute cost. These are not negotiable line items and they begin the month you open, which is why a brand with a modest ratio and a heavy fee load is the slowest configuration in the dataset. The full picture of what leaves the business is in Item 6 and our breakdown of total ongoing franchise fees.
The generic range is not fabricated. It is just misapplied. It holds up where the ratio supports it:
Where it does not hold: fitness and wellness (0.93x), health and beauty (1.08x), food and beverage (1.17x). In those three categories, covering 197 of the 459 brands, the median unit pays back in 68 to 86 months at a 15% net margin, and repaying Item 7 in two years would take a 42.6% to 53.6% margin. The profit disclosures agree: Planet Fitness at about 57 months, Firehouse Subs at about 80, Popeyes at about 131. Treat any 12-24 month claim in those categories as a claim about operational breakeven at best, not capital recovery.
For the brands that clear the bar fastest, ranked rather than illustrated, see quick payback franchises with sub-3-year ROI. It applies the same two disclosures at a different margin assumption, so read the methodology line on both before comparing figures.
Keep the two milestones separate:
Four numbers, all disclosed, no estimates required:
Then divide, three ways. Item 19 median ÷ Item 7 midpoint gives you the ratio. Item 7 midpoint ÷ (Item 19 median × your margin) × 12 gives you payback in months, which is the number the revenue tables on this page report. And Item 7 midpoint ÷ (2 × Item 19 median) gives you the net margin a unit would have to clear for a 24-month payback. If that last number is above 25%, the brand’s own disclosures are telling you the two-year story is not on the table. If Item 19 includes EBITDA or operating profit, skip the margin and divide the Item 7 midpoint by that profit figure directly, as the first table does. Run the same figures through a break-even calculation before you sign and against a realistic cash-on-cash return target, because a brand can pass one of those tests and fail the other.
Item 7 is the cost of opening. It is not the cost of surviving until the ratio starts working for you.
A $200,000 Item 7 realistically requires $350,000 to $455,000 in available capital. Undercapitalization is the mechanism behind most delayed paybacks: run out of cash at month eight and you stop funding the marketing that drives the ramp, which extends the ramp, which drains more cash.
If you are financing, model the payment before you sign. Most SBA 7(a) loans price off the Wall Street Journal prime rate plus a lender spread, so use the rate in effect when you apply rather than one quoted in an article. That payment is a fixed monthly cost landing on top of rent, labor, and the royalty and ad fund figures above, and it does not wait for revenue to ramp. Our cash-flow stress test at 2026 SBA rates shows how a higher payment reshapes the first two years, and the due diligence checklist covers what to validate with existing franchisees before you commit.
For the underlying investment and revenue benchmarks by sector, see the franchise industry statistics report. To compare ratios directly, browse 2,000+ franchise profiles, each built from the brand’s own Item 7 and Item 19 disclosures.
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About this analysis The franchise data in this article is drawn from VetMyFranchise's structured analysis of 2,300+ Franchise Disclosure Documents filed with U.S. state regulators. See our data & methodology.
On the profit franchisors disclose, between about 10 months and about 131 months. Ten brands publish an Item 19 profit figure that can be set against their Item 7 midpoint, and their payback periods are i9 Sports 10 months, Options Home Care 11, Goddard School 32, Take 5 Oil Change 52, Sport Clips 53, Planet Fitness 57, Anytime Fitness 72, Firehouse Subs 80, Camp Bow Wow 90 and Popeyes 131. Only three are under three years, and none of the figures deducts debt service. For brands that disclose revenue only, category medians run from about 12 months in senior care to about 86 in fitness at an assumed 15% net margin.
Senior care leads by a wide margin. Across 25 senior care brands with usable Item 19 data, the median unit generates 6.91x the Item 7 midpoint in annual revenue. Home services follows at 3.04x (69 brands), cleaning and maintenance at 2.60x (37 brands), and financial services at 2.55x (8 brands). Home Instead's FDD 2026 shows a $2,352,451 median across 611 franchised units against a $221,595 Item 7 midpoint, a 10.6x ratio and an 8-month payback at a 15% net margin. On disclosed profit, Options Home Care's FDD 2026 reports a 2025 median EBITDA of $156,988 for franchisees open at least three years against a $146,200 Item 7 midpoint, about 11 months, though that EBITDA includes the owner's income.
For a low-overhead service brand, yes, and one FDD proves it without an assumed margin. i9 Sports' 2026 filing discloses a franchisee income statement covering 129 units from October 2024 to September 2025, with a median operating profit of $80,173 before owner compensation. Against a $64,900 Item 7 midpoint that is a payback of roughly 10 months. For a capital-heavy brand the same math breaks. Burger King's FDD 2026 shows a $1,593,606 median across 4,730 franchisee-owned traditional restaurants against a $2,784,900 Item 7 midpoint, which is about 140 months at a 15% net margin and would need an 87.4% margin to repay in 24.
Not as a disclosed number, and franchisors are prohibited from projecting one outside Item 19. But Item 7 gives you the capital at risk, Item 19 gives you unit revenue where disclosed, and Items 5 and 6 give you the royalty and ad fund that come off the top. Those four figures let you calculate the net margin a unit would have to clear to repay the investment on any timeline you pick. Some Item 19s go further and publish EBITDA or operating profit, which lets you calculate payback directly. Item 20 then tells you how many franchisees did not last long enough to find out.
Because roughly a third of Item 19 tables exclude new units. Of the 459 brands analyzed, at least 141 restrict the reported population to units meeting a maturity or qualification screen. Sport Clips (FDD 2026) reports on "mature stores (with more than 2 years in operations)." Wild Birds Unlimited (FDD 2026) reports on franchises "open and operational for at least 24 months." Anytime Fitness (FDD 2026) reports on "Franchised Anytime Fitness Centers Operating With AF Coaching." The disclosed median describes the survivors, not your first twelve months.
About five to six years on the profit Planet Fitness and Anytime Fitness disclose. Planet Fitness's FDD 2026 shows average EBITDA of $696,572 across 262 corporate-owned clubs in 2025, against a $3,334,250 Item 7 midpoint, about 57 months. Anytime Fitness's FDD 2026 shows a median EBITDA of $120,509 across 11 company-owned centers, with expenses restated to what a franchisee would pay, against a $722,406 midpoint, about 72 months. Both come from company units, both exclude debt service, and the Anytime Fitness centers out-earn the franchised median, so a financed franchisee should plan on longer.
Beyond your Item 7 total, plan for 6-12 months of business operating expenses as working capital, 12-18 months of personal living expenses assuming no franchise income, and a 10-15% contingency buffer. A franchise with $200,000 in Item 7 costs realistically requires $350,000-$455,000 in total available capital. Note that Item 7 already contains an "additional funds" line, but it covers only the short initial period the franchisor states and almost never covers a full ramp.
They reduce every revenue dollar before you see it. At Wingstop's FDD 2026 Item 19 median of $1,890,866, the 6% royalty and 5.5% ad fund total $217,450 a year. At Great Clips' $390,685 median, the 6% royalty and 5% ad fund total $42,975. At Burger King's $1,593,606 franchisee-owned median, the 4.5% royalty and 4.5% ad fund total $143,425. Those are contractual, they start when you open, and they do not wait for the unit to ramp.
SBA loan payments push owner-income breakeven later because the payment is a fixed cost sitting on top of rent, labor, and royalties that does not wait for revenue to ramp. Most buyers use an SBA 7(a) loan priced at the Wall Street Journal prime rate plus a lender spread, so check the current prime rate before you model the payment. None of the profit figures in the payback table deducts debt service, so every dollar of loan payment comes out of that profit before any of it repays your own capital. The larger your loan relative to Item 7, the longer full payback takes.
Breakeven is the month your revenue covers your operating expenses, including royalty, ad fund, rent, labor, and debt service. Payback is the later date when cumulative profit equals the full Item 7 investment you put in. Franchise sales conversations usually mean the first when they say "profitable in 12 to 24 months." The tables on this page measure the second, which is the number that decides whether the deal was worth doing.
About 80 months at Firehouse Subs and about 131 at Popeyes, on the EBITDA those brands' 2026 FDDs report. Firehouse's 704 reporting franchised restaurants show a median restaurant-level EBITDA of $95,743 against a $640,650 in-line Item 7 midpoint. Popeyes' 2,007 franchised free-standing restaurants average $236,161 against a $2,572,645 midpoint. The revenue math agrees. Across 129 food and beverage brands with usable Item 19 data, the median unit generates 1.17x its Item 7 midpoint, about 68 months at a 15% net margin. Plan on a multi-year payback and judge the deal on operational breakeven first.
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