Initial franchise fee
Franchise Expo USA reports franchise fees range from $10,000 to over $100,000 depending on the brand's recognition and support. See FDD Item 5.
Investment bands
Franchise investment ranges for first-time owners
Last updated: October 2026
Franchise investments range from about $10,000 to several million dollars, so set your comfort range before you look at brands.
Franchise Fit Guide uses four planning bands to help first-time owners match concepts to money they are comfortable committing. The bands are rough guides, not quotes: every brand publishes its own estimated initial investment in Item 7 of its Franchise Disclosure Document, and that range is the number to plan around.
How much should I invest in a franchise?
Invest what you are comfortable with, including several months of working capital, not the maximum a lender approves. As Frannexus puts it, someone who technically qualifies for a $500,000 opportunity may still be wrong to invest $500,000.
Agree on a ceiling with your financial advisor and your partner first. Then the band you land in quickly filters which concepts are worth researching.
Four planning bands
| Total initial investment | What often falls in this band | Question to ask yourself |
|---|---|---|
| Under $100,000 | Often home-based, mobile, or service concepts with little or no build-out. | Is my working capital enough to cover the months before revenue? |
| $100,000 to $250,000 | Often service businesses with vehicles or a small office, and some smaller retail formats. | How much of this range is financed, and what does that payment look like? |
| $250,000 to $500,000 | Often storefront retail, fitness, or quick-service formats with build-out and equipment. | Can my household absorb a slower ramp-up than planned? |
| Over $500,000 | Often full-service restaurants, larger sites, or multi-unit commitments. | Am I investing this because it fits, or because I qualify? |
What goes into the total investment?
Royalties and marketing fees
Usually a percentage of gross sales. Franchise Expo USA says 4 to 8 percent is common; L'Express Franchise found about 4 to 10 percent among the profitable brands it reviewed. See FDD Item 6.
Build-out, equipment, and working capital
Real estate, equipment, inventory, and the cash to operate before you break even. These usually make up most of the range in FDD Item 7.
How wide is the spread between brands?
Very wide. GrowthFactor reports a Subway franchise can start at $233,000 while a Burger King requires up to $4.67 million, and that the average initial investment across the industry declined 2.7 percent in 2025. Vetrepreneur notes there are franchises that cost $10,000 and franchises that cost a million dollars.
Because the spread is so large, the investment band is one of the fastest filters in choosing the right franchise. Pair it with the self-assessment so cost and fit point the same way.
Common questions
- How much does a franchise cost?
- Costs range widely. Vetrepreneur notes there are franchises that cost $10,000 and franchises that cost a million dollars, and GrowthFactor reports a Subway can start at $233,000 while a Burger King can require up to $4.67 million. Item 7 of each brand’s Franchise Disclosure Document lists its estimated initial investment range. More in the FAQ
- How much is a typical franchise fee?
- Franchise Expo USA reports initial franchise fees range from $10,000 to over $100,000 depending on the brand’s recognition and support. The fee is only one part of the total investment, which also covers equipment, build-out, inventory, and working capital. Item 5 of the Franchise Disclosure Document shows the initial fee for a specific brand. More in the FAQ
- What are franchise royalties?
- Royalties are ongoing payments to the franchisor, usually a percentage of gross sales. Franchise Expo USA reports 4 to 8 percent is common, and L’Express Franchise found roughly 4 to 10 percent among the profitable brands it reviewed. Many systems also charge a marketing fund contribution. Item 6 of the FDD lists every recurring fee. More in the FAQ
- How much should I invest in a franchise?
- Invest an amount you are comfortable with, not the maximum you qualify for. Frannexus makes the point that someone who technically qualifies for a $500,000 opportunity may still be wrong to invest $500,000. Set a comfort ceiling with your financial advisor, including working capital for the early months, before you look at brands. More in the FAQ
- How do people finance a franchise?
- Common routes include personal savings, SBA-backed loans, conventional bank loans, home equity, retirement-account rollover structures, and franchisor financing where offered. Each carries different risks and costs. Talk with a financial advisor and a lender early, because financing shapes which investment band is realistic for you. More in the FAQ
- What is the cheapest food franchise to start?
- Food franchises usually cost more than service concepts because of equipment, build-out, and staffing. GrowthFactor cites a Subway starting at $233,000 as one example. Lower-cost food formats such as kiosks or mobile units exist, so compare each brand’s Item 7 range, and decide whether food service suits your lifestyle before chasing the lowest price. More in the FAQ
Know your number? See what fits it.
Tell a FranNet consultant your comfort range and they will present options that match it. There is no cost to you, and no promise of results: just a clearer shortlist.