Top 10 Revenue Streams
Top 10 Revenue Streams
1. Initial Franchise Fees
($5,000 - $50,000)
2. Franchise Royalties
(3% - 10% Of Gross Sales)
3. Services Provided To Franchisees
(Varies With Services)
4. Sales Of Equipment To Franchisees
(Varies With Equipment)
5. Sales Of Products And Supplies To Franchisees
(Varies)
6. Rebates From Vendors And Suppliers
(2% - 20%)
7. Master Franchise Fees
($100,000 - $1 Million+)
8. Training Fees
($1,000 - $10,000)
9. Transfer Fees
($1,000 - $12,500 When A Franchise Is Sold To Another
Franchisee)
10. Franchise Renewal Fees
(50% - 100% Of Initial Fee)
Profit Potential
.
Business owners can earn $300,000 or more from each and every franchised unit over 20 years.
Franchise Profit Potential
The following is an example of the potential income to you from the sale of one franchise. The example is based on you charging an initial franchise fee of $25,000 and a 6% royalty fee.
Franchise Fee Income
One (1) franchise unit sold at $25,000 = $25,000
Royalty Fee Income
One (1) franchise unit generating an average of $250,000 per year in gross sales and paying a 6% royalty = $15,000/year or $300,000 over the course of 20 years.
The success of a franchise company is based mostly on its recurring fees (royalties) that are normally received weekly or monthly from franchisees. The initial franchise fee and other revenue streams help a company grow and produce cash flow to sustain that growth, but the royalty income and the income from the sale of proprietary products to franchisees are the main sources of growth and profitability.