Knowledge Base

Are there any hidden charges when buying a franchise?

Costs
Written by
Sam Stawarz
Published on
June 12, 2023

If you're thinking about buying a franchise, it's important to know what the costs are going to be. There are several fees that you should expect when buying a franchise, but there may also be some hidden charges. Let's take a look at the fees that come with buying a franchise and how you can avoid any hidden charges along the way!

The fees involved in buying a franchise.

There are several fees involved in buying a franchise. These can be broken down into two categories:

  • Fees related to the sale of your business, such as the franchise fee and royalty fee.
  • Fees related to running your business, such as advertising fees and training costs.

Are there any hidden charges?

No, there are no hidden charges. The price you see is the price you pay. However, there are some fees associated with buying a franchise that you should be aware of:

  • Franchise fee--this covers the cost of buying into the system and getting started with your franchise business. It's often paid over time as part of your royalty payments (see below). Some franchises may also charge an upfront fee instead of an ongoing royalty payment structure; this can be negotiated during your initial contract negotiations.
  • Royalty fees--these are usually based on a percentage of sales or profits from each store location in your chain, but they vary widely depending on what kind of franchise it is; some franchises require more money than others do because they offer more services or support than others do
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