Complete breakdown of franchise costs in 2026 by industry. Learn about Item 7, hidden costs, working capital needs, and financing options before you invest.
Quick answer The median franchise costs $187,750 to $452,000 to open, from Item 7 of the 1,734 non-lodging systems in VetMyFranchise's library with a current 2025 or 2026 Franchise Disclosure Document. The middle half of the market has a midpoint between $155,160 and $662,550. Only 4.3% open for under $50,000 and 15.7% cost $1 million or more. The median franchise fee is $42,500, just 11.5% of the total, and 87% of Item 7 tables that name a period budget only three months of working capital.
The median franchise costs $187,750 to $452,000 to open, with a midpoint of $325,015. Half the market lands between a $155,160 midpoint and a $662,550 one, and 15.7% of systems run past $1 million. Those figures come from Item 7 of every non-lodging system in VetMyFranchise’s library with a usable initial investment range, parsed from Franchise Disclosure Documents filed with state regulators. All 1,734 are 2025 or 2026 filings, and 1,281 of them (74%) are from 2026.
Most cost articles answer this question with “$50,000 to $500,000,” which is technically true and useless for budgeting. The distribution underneath that range is what you can plan against.
| Where a brand sits | Item 7 low | Item 7 high | Midpoint |
|---|---|---|---|
| 25th percentile | $97,660 | $207,200 | $155,160 |
| Median | $187,750 | $452,000 | $325,015 |
| 75th percentile | $390,600 | $898,156 | $662,550 |
1,734 systems with a usable Item 7. The 10th percentile midpoint is $87,095 and the 90th is $1,371,250.
Two counts frame the edges. 447 systems have an Item 7 low estimate under $100,000, 185 of them under $50,000, and 386 systems have a high estimate at or above $1 million. Roughly a quarter of the franchise market is a seven-figure commitment and roughly a quarter has a six-figure entry point. Very little is “typical.”
A note on the source data, because it matters for trust. These figures are parsed from PDF disclosure documents, and column-merge errors in that extraction produce occasional nonsense, like a $323 million senior care system or a $156 million pool service. This analysis excludes any filing where the high estimate does not exceed the low, where the low falls under $2,000, where a sub-$5,000 low sits against a six-figure high, or where the high passes $15 million outside lodging. That rule discards 285 of the 2,092 systems with both values on file. Hotel and resort systems are held out of every table below and reported separately: their 73 filings have a median Item 7 of $1,128,210 to $11,178,916, which would distort every median it touched.
Buyers shop a budget rather than a distribution. Sorted by the midpoint of each brand’s own disclosed range, the market divides like this.
| Total investment band | Systems | Share | Running total | Median Item 7 range in band | Median franchise fee |
|---|---|---|---|---|---|
| Under $50,000 | 74 | 4.3% | 4.3% | $18,988 to $45,788 | $17,250 |
| $50,000 to $100,000 | 141 | 8.1% | 12.4% | $52,350 to $102,250 | $38,500 |
| $100,000 to $250,000 | 511 | 29.5% | 41.9% | $109,550 to $223,050 | $49,500 |
| $250,000 to $500,000 | 415 | 23.9% | 65.8% | $222,000 to $495,000 | $42,000 |
| $500,000 to $1 million | 321 | 18.5% | 84.3% | $404,000 to $901,440 | $42,500 |
| $1 million or more | 272 | 15.7% | 100% | $894,600 to $2,475,498 | $45,000 |
Banded on each system’s Item 7 midpoint, 1,734 filings.
The single most common price point is the $100,000 to $250,000 band, which holds 511 systems, nearly a third of the market. That band is where home services, cleaning, senior care and tutoring concentrate. Verified examples: Kumon at $101,630 to $233,780 and Home Instead at $92,640 to $350,550, both 2026 filings.
The sub-$50,000 tier is genuinely small at 74 systems. If you are shopping there, the franchises under $50K and under $100K lists are the practical shortlists, and the cheapest franchises report ranks every one of them by total investment. Watch the fee column in the table above while you do: the cheapest band charges the smallest franchise fee, $17,250 at the median, which tells you those systems are selling a business model rather than a build-out.
Category predicts cost better than brand strength does, because category decides whether you need a customer-facing building.
| Industry | Systems | Median Item 7 range | Middle half (midpoints) | Median fee |
|---|---|---|---|---|
| Food & Beverage | 512 | $369,950 to $855,624 | $403,575 to $1,161,925 | $35,000 |
| Health & Beauty | 79 | $322,750 to $621,800 | $325,662 to $674,742 | $49,750 |
| Fitness & Wellness | 142 | $310,700 to $716,796 | $297,674 to $731,775 | $49,500 |
| Pet Services | 47 | $238,750 to $470,450 | $164,412 to $895,291 | $49,900 |
| Automotive | 53 | $192,375 to $650,400 | $174,080 to $729,250 | $39,500 |
| Retail | 106 | $184,668 to $431,000 | $202,804 to $501,029 | $35,000 |
| Child Services & Education | 126 | $134,740 to $335,341 | $111,250 to $649,372 | $49,000 |
| Cleaning & Maintenance | 118 | $134,222 to $286,925 | $142,490 to $311,938 | $49,500 |
| Home Services | 232 | $128,659 to $226,250 | $126,718 to $235,678 | $49,500 |
| Senior Care | 104 | $119,692 to $248,238 | $131,888 to $349,519 | $50,000 |
| Business Services | 76 | $80,650 to $183,955 | $78,151 to $284,900 | $49,500 |
| Real Estate | 68 | $55,582 to $215,550 | $84,711 to $195,619 | $25,000 |
| Financial Services | 28 | $54,524 to $112,500 | $60,344 to $127,444 | $30,000 |
Categories with fewer than 15 usable filings are omitted. Lodging is excluded throughout.
Restaurants cost roughly seven times what a financial-services concept costs at the median low estimate, and the reason is construction, not brand value. Home services carries the tightest middle half of any large category, $126,718 to $235,678, which makes it the easiest one to underwrite. The fee column, meanwhile, stays between $25,000 and $50,000 from top to bottom, across categories whose total cost differs by a factor of seven. Senior care charges the highest median fee in the table while sitting near the bottom on total investment.
Item 7 is filed under regulatory scrutiny, which makes it the most honest cost number a franchisor publishes. It is also bounded, and the boundary sits in one line.
Across the 1,689 systems that disclose both a fee and an investment range, the initial franchise fee is a median of 11.5% of the total investment (middle half: 5.2% to 27.1%). Working capital takes a similar slice. Parsing the working capital or “additional funds” line directly out of 1,617 Item 7 tables, the median entry is $20,000 to $50,000, which is 10.1% of the brand’s own midpoint. Everything else, roughly three quarters of the money, is build-out, equipment, fixtures, signage, inventory and deposits.
The number that costs new owners real money is the period. Of the 930 filings that state how long that working capital is meant to last, 813 (87%) budget exactly three months. Sixty-one say six months and twenty-five say twelve. Three months is not a ramp. Royalties, ad fund contributions, rent and payroll all start in week one, and most single units take a year to reach a stable revenue line.
Two verified examples show the gap at opposite ends of the market. Great Clips discloses $187,800 to $419,900 in its 2026 FDD, with leasehold improvements at $70,000 to $200,000, fixtures and signage at $40,000 to $55,000, grand opening advertising at $20,000 to $25,000, and additional funds of $20,000 to $60,000 covering three to six months. Culver’s discloses $3,406,350 to $10,294,100, of which land, site work and the building account for $2,628,000 to $8,984,000. Its additional funds line is $65,000 to $120,000 for three months, under 2% of the project either way.
Tropical Smoothie Cafe makes the point most sharply. Its 2026 Item 7 runs $275,500 to $770,500 and its working capital line is $1,500 to $52,500 for three months. A buyer who budgets from that document alone and opens at the high end has funded a $770,500 build with as little as $52,500 of runway behind it.
Budget from the Item 7 high estimate, add 15% for build-out overruns, add three to six months of operating reserve beyond what the table shows, and add your own living expenses. On a $500,000 high estimate that lands near $670,000. Our build-out cost breakdown and the list of costs that never appear in the FDD go through the additions line by line.
Opening cost is one number. Owning cost is a percentage of every dollar you ever ring up, and Item 7 does not include a cent of it.
Across the systems disclosing a rate, the median royalty is 6% of sales (mean 6.17%, with 67% of brands at 6% or below) and the typical advertising or brand fund contribution is 2%. For the 1,518 systems disclosing both, the combined figure at the midpoint is 8% of gross sales, and 59% sit at or above that. A further 492 systems disclose a recurring technology fee we can price: $311 a month at the median, with 53% charging $300 or more, which is $3,700 a year before a single customer walks in.
The inversion worth understanding is that cheap-to-open often means expensive-to-own. Coverall North America opens for $17,986 to $64,280 in its 2026 filing, one of the lowest entry points in the library. Its Item 6 discloses a 5% royalty plus a separate 10% support fee, both on gross dollar volume billed, for 15% off the top. Goosehead Insurance opens for $66,000 to $111,500 and charges 20% of gross revenues during the initial term. Culver’s, at nearly two hundred times Coverall’s entry cost, charges 4% plus 2.5%.
On a unit doing $1 million in sales, the difference between a 6.5% combined load and a 13% one is $65,000 a year, every year, for a ten-year term. That gap dwarfs any franchise fee in the library. Read Item 6 before Item 7, and check the brand against our royalty burden index, the ongoing fee breakdown and the technology fee data.
Most franchise purchases run through an SBA 7(a) loan, and the SBA publishes every approval. Filtering the agency’s loan-level file for franchise-coded borrowers gives the real number rather than a range someone guessed at.
In fiscal 2026 through March 31, lenders approved 3,774 franchise 7(a) loans across 1,137 distinct brands, 14% of all 7(a) approvals in the period. The median initial interest rate was 9.25%, with the middle half between 8.50% and 9.75%. The median gross approval was $363,150 on a median term of 120 months, and 92% of those loans carry a variable rate that reprices with prime.
| Fiscal year | Franchise 7(a) loans | Median initial rate | Median loan |
|---|---|---|---|
| 2024 | 5,904 | 11.00% | $327,000 |
| 2025 | 7,135 | 10.00% | $380,000 |
| 2026 (through 3/31) | 3,774 | 9.25% | $363,150 |
SBA 7(a) FOIA loan-level file, franchise-coded approvals only, data as of March 31, 2026.
Rates have come down 175 basis points in two years, which is real relief, but the payment is still the number that kills deals. The median $363,150 loan at 9.25% over ten years costs $4,650 a month, or $55,794 a year in debt service before you pay yourself. A $500,000 loan on the same terms is $6,402 a month. Set that against the brand’s Item 19 median revenue and the 8% royalty and ad load, and you can see in about two minutes whether the unit can carry the debt. Only 1,456 of 2,126 systems (68%) publish an Item 19 at all, so for roughly a third of the market you and your lender are underwriting a projection with no disclosed benchmark behind it.
Practical notes on structure. Lenders want a 10% to 20% equity injection from documented sources. A 401(k) rollover can fund that injection without an early withdrawal penalty, at the cost of real structural complexity. A HELOC is cheaper capital that puts your house behind a business with a documented failure rate. The full SBA franchise loan guide walks the underwriting, and the HELOC versus SBA versus ROBS comparison covers the tradeoffs.
Every figure below was read out of the brand’s own current Franchise Disclosure Document and cross-checked against its Item 7 total.
Coverall North America discloses that 2026 range, of which $16,668 to $45,660 goes to the franchisor. Commercial cleaning, home-based, no build-out, and the initial fee is most of the cost. The tradeoff sits in Item 6: 5% royalty plus a 10% support fee on gross dollar volume billed. You buy in cheaply and pay for it every month afterward.
Great Clips discloses that range in its 2026 filing. Franchise fee $20,000, which is 10.7% of the low estimate and 4.8% of the high. Leasehold improvements including labor run $70,000 to $200,000 and fixtures, signage and salon technology hardware another $40,000 to $55,000, so construction and equipment are 59% to 61% of the project. Additional funds cover three to six months at $20,000 to $60,000. Ongoing: 6% of biweekly gross sales plus a 5% ad fund. Item 19 reports a median of $390,685 across 4,158 salons for 2025, so the 11% fee load is roughly $43,000 a year at the median unit.
Culver’s discloses that range in its 2026 filing. Land $225,000 to $2,400,000, site work $356,000 to $2,193,000, building $2,047,000 to $4,391,000, furniture and equipment $458,000 to $584,000, sign package $88,000 to $300,000, POS $42,350 to $56,100. The franchise fee of $35,000 to $65,000 is under 2% of the project at either end of the range. Ongoing royalty is 4% plus a 2.5% ad contribution, the lightest load of these three, which is what a franchisor can charge when the franchisee is carrying eight-figure real estate.
Read those three together and the pattern is hard to miss. The franchise fee tells you almost nothing about affordability, and the ongoing rate tends to move in the opposite direction from the entry cost.
The market range is context. Before you sign anything, pull the four numbers that decide the deal, in this order.
Then confirm the year on the document. FDDs are re-filed annually and every range moves. Each brand page on this site shows the parsed Item 7, Item 5 and Item 6 figures with the filing year attached, and our Item 19 transparency leaderboard and franchise fee benchmark rank every system against its category.
Every figure on this page came out of a filed disclosure document rather than a development brochure. Use the compare tool to put two brands side by side, filter the full library by budget, run your own numbers through the investment calculator, or start from the cost breakdown by tier.
The cost to open is the first number a franchise salesperson will quote you and the least decisive one on its own. Pair it with the working capital period, the Item 6 fee stack and the Item 19 median before you write a check.
Get the full 12-section FDD analysis — $49
Real franchise data, real Item 19 numbers, personalized to your capital and location. Comparing 2–3 brands? The 3-pack is $99.
Browse franchises · pick your brand Or see a real sample report →
Get this comparison as a spreadsheet.
We'll email you the full comparison spreadsheet: every brand in this category with its Item 7 investment range and royalty, side by side. No spam, unsubscribe anytime.
✓ Check your inbox
The comparison spreadsheet is on its way.
The only franchise report written entirely for the buyer. 12 sections covering financial risks, legal obligations, and a personalized recommendation.
Browse Franchise Library See a real sample report →
$49 per brand · $99 for a 3-brand pack
franchise costsinvestmentitem 7item 5franchise feefinancingstartup costs
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.
The median franchise costs $187,750 to $452,000 to open. That is the median of the Item 7 low estimate and the median of the Item 7 high estimate across 1,734 non-lodging franchise systems with a current Franchise Disclosure Document on file, all of them 2025 or 2026 filings. The distribution is wide: 4.3% of systems open for under $50,000, 41.9% come in under $250,000, and 15.7% cost $1 million or more. Item 7 already covers the franchise fee, build-out, equipment, opening inventory and a first slice of working capital, but it excludes your living expenses and usually stops at three months of operating reserve.
The median total investment midpoint is $325,015 and the middle half of the market falls between $155,160 and $662,550. Medians beat averages here because a small number of hotel and large-format restaurant systems drag the mean far above anything a normal buyer will pay. When a source quotes one average franchise cost, ask whether it is a median or a mean, across how many disclosure documents, and whether hotels were included. Lodging systems alone have a median Item 7 of $1,128,210 to $11,178,916.
Real entry points start near $18,000. Only 74 of 1,734 systems (4.3%) have an Item 7 midpoint under $50,000, and their median range is $18,988 to $45,788 with a $17,250 median franchise fee. Coverall North America discloses $17,986 to $64,280 in its 2026 filing and Jazzercise discloses $2,170 to $2,965 for an associate franchisee. What the cheap tier has in common is no build-out, not a cheaper brand. It also tends to carry the heaviest ongoing fee load.
Industry sets the number because industry decides whether you need a building. Median Item 7 ranges run from $54,524 to $112,500 in financial services and $55,582 to $215,550 in real estate up to $310,700 to $716,796 in fitness and $369,950 to $855,624 in food and beverage. Home services sits at $128,659 to $226,250, senior care at $119,692 to $248,238, and cleaning at $134,222 to $286,925. The median franchise fee barely moves across that whole span, staying between $25,000 and $50,000 in every category.
Plan on roughly a third more than the Item 7 high estimate. Of the 930 filings that state a working capital period, 813 budget exactly three months, and the median working capital line is $20,000 to $50,000. That covers payroll, rent and the royalty clock during a ramp that usually runs a year. Add a build-out contingency, three to six more months of operating reserve, and your own living expenses, none of which Item 7 is required to estimate.
Around 9.25%. Across 3,774 franchise-coded SBA 7(a) loans approved in fiscal 2026 through March 31, the median initial rate was 9.25%, with the middle half between 8.50% and 9.75%. The median loan was $363,150 on a 120-month term, which is about $4,650 a month. Roughly 92% of those loans carry a variable rate that reprices with prime, so underwrite the top of the range rather than the median.
This page is part of VetMyFranchise. View all pages: llms.txt · llms-full.txt