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Before You Buy a Franchise: Know the Real Costs

When people look into buying a franchise, one of the first numbers they see is the franchise fee. It’s often promoted as the total price to get in the door — but the truth is, that’s only a small part of what you’ll actually spend.

If you’re considering buying into a franchise system, you need to get a clear picture of both the startup and ongoing costs — because they can add up fast. And if you don’t plan for them, it can put your business — and your financial security — at risk.

Let’s break it down.

What Does It Really Cost to Open a Franchise?

Most franchises advertise an initial franchise fee — typically anywhere from $20,000 to $50,000 or more depending on the brand. But that’s just the beginning.

Here’s what you also need to budget for:

• Equipment and vehicles
• Inventory and supplies
• Licensing and insurance
• Buildout or lease improvements (if there’s a physical location)
• Marketing fees (both local and national)
• Training travel and lodging expenses
• Technology and POS systems
• Legal and accounting fees

It’s not uncommon for your real startup investment to be two to three times higher than the franchise fee alone.

The Ongoing Fees You’ll Keep Paying

Even after you open your doors, the costs don’t stop. Most franchise systems require:

• Ongoing royalty fees — usually a percentage of your gross sales (not profit).
• National marketing fees — whether or not you feel the impact locally.
• Software, support, or compliance fees
• Annual renewals or audits

And those costs aren’t optional. They’re written into your franchise agreement — and often increase over time.

Why It Matters

Before you commit to a franchise, it’s critical to count the real cost. Many new owners underestimate these numbers, thinking the franchise fee is the biggest expense, only to be blindsided later.

When you understand the total investment, you can:

✅ See how long it will realistically take to turn a profit.

✅ Decide if the business model is financially sustainable for you.

✅ Avoid financial strain or surprises down the road.

A Better Way: Know Before You Commit

At American Hose Pro, we’ve seen how costly traditional franchising can be — and how hidden fees can leave good business owners feeling trapped. That’s why we created FAIRchise, a business model designed to give people the support, systems, and freedom they need without the endless fees and long-term contracts.

It’s not about attacking franchising. It’s about offering a smarter, fairer option where you keep more of what you earn and invest it back into your own future.

Bottom line:

Before you sign a franchise agreement, make sure you understand every dollar you’ll spend — upfront and over time. It’s not just about getting into business; it’s about staying in business.

And if you’re looking for a better, fairer way to build a business you control, we’d be glad to show you what that looks like.