How Much Does a Franchise Cost? Item 7 Ranges From 55 Filed FDDs

The headline finding

Real estate is hidden in roughly 45% of these headline totals. A franchisor can show a clean Item 7 range and still leave the most expensive line, the land and the building, entirely out of it. The Goddard School discloses about $1.0M for a lease format and about $5.5M for the buy-land-and-build format, the same brand, a 5x swing driven only by who owns the real estate. Midas shows a $385,450-floor 8-bay total that excludes $615K to $1.25M of land and $1.25M to $2.05M of construction. If you underwrite the headline number, you can be off by millions before you sign.

How we built this

New to Item 7 itself? The Item 7 table explained guide covers how to read the table line by line; this page is the data.

We pulled the most recent registered Franchise Disclosure Document for 55 franchise brands directly from US state franchise registries (primarily Wisconsin DFI), not from aggregators or summaries. We read Item 7 (Estimated Initial Investment) in each filed FDD and recorded the low-high total plus every disclosed line item, verbatim. We classified each brand into one of 10 industry categories and recorded the FDD cover year. Where a franchisor disclosed more than one store format (for example conversion versus ground-up build, kiosk versus endcap), each row below records a single named format's range and is never a blend across formats; additional disclosed formats are preserved in that brand's row notes. The 56 rows below cover 55 brands.

We excluded any figure we could not trace to a filed Item 7 table or its summary sentence. We did not estimate, average, or infer any number. We flagged, not silently corrected, every internal inconsistency we found, such as a summary sentence whose low differs from the table total. Those are footnoted on the relevant rows. We did not adjust for inflation, region, or unit count. Every figure is as-disclosed.

Honest limits: this is a sample of 55 brands across 10 categories, not the franchise market average. It is large enough to show category-level patterns, not market-wide certainty. Item 7 ranges are franchisor estimates, not actuals; real costs vary by location, market, and build. No more than about 20% of the sample is from any single category.

The benchmark

Sort any column, filter by category, and click any row to expand the format breakdown and real-estate handling. Default sort is total investment low, ascending. Dollar figures are as-disclosed in the FDD.

Category patterns

One row per category, computed from the rows above. Median midpoint is the median of each brand format's (low plus high) divided by two. The last column is the share of formats whose headline total excludes the cost of real estate.

What the headline number hides: the normalization checklist

Before you compare two Item 7 tables, normalize for these, or you will compare numbers that do not mean the same thing.

1. Real estate: Does the total include the building, or exclude it? 25 of 56 formats here exclude real estate purchase from the headline. A $385K auto shop can become $2M and up once you add the land and construction the table left out. Always check the real-estate column first.
2. Store format: A franchisor's low number is often its cheapest format (conversion, kiosk, food truck). The build-it-from-the-ground-up number can be 3x to 5x higher. Match formats before comparing.
3. Working capital period: The additional-funds line usually covers 3 months, but some disclose 6, 9, or 12. A bigger reserve is not a more expensive franchise; it is a longer runway baked in.
4. Franchise fee versus territory or development fee: Some totals bundle a development or territory fee on top of the franchise fee. The to-franchisor number is what actually leaves your pocket up front.
5. Landlord allowance: Several leasehold-improvement ranges are net of an assumed tenant-improvement allowance. If your landlord gives less, your real cost is higher.
6. Owner salary: Item 7 reserves rarely include your own living expenses. Add your runway on top.

How to read this before you sign

Searchers and acquirers: use the category patterns to sanity-check a seller's or franchisor's claimed opening cost against peers in the same lane, then dig into the real-estate footnote before you model returns.

Franchise buyers: pull the format that matches your actual site, not the cheapest one in the range, and rebuild Item 7 line by line against real quotes. The low end is rarely your base case.

Multi-unit developers: watch the development and territory fees and the ADA (area development agreement) formats, where the per-unit math and the up-front commitment change the picture.

How Inkvex surfaces these traps on a real FDD

This benchmark is the pattern. On a specific deal, an Inkvex review reads the actual FDD and tells a buyer what the number means before they sign: a risk score from 1 to 10, the exact Item 7 clauses quoted, the real-estate-exclusion and working-capital traps flagged, and an attorney-handoff summary. It is the same lens applied to your document instead of a sample.

Franchise cost FAQ, answered from the filed FDDs

Every figure below is as-disclosed in the brand's filed FDD; the benchmark table above carries the format breakdowns and footnotes.

Related diligence guides

• Franchise costs by brand: every FDD in this benchmark, one page per brand
• FDD Item 7 estimated initial investment checklist
• FDD red flags
• FDD review checklist
• Personal guarantees in franchise agreements
• Multi-unit development agreements