|
ampm Franchise ProfileRetail Franchises > Convenience Stores |
What Are the Initial Costs to Open an ampm Franchise?
The initial investment for an ampm franchise ranges significantly, with costs starting as low as $313,861 and going up to $7,602,212. This includes a franchise fee of $30,000, along with other startup expenses. Franchisees should also be prepared to maintain a cash reserve of at least $50,000 and meet a net worth requirement of $500,000 to $1,000,000. Understanding these financial commitments is crucial for aspiring franchisees to evaluate their readiness for this opportunity.
What Are the Financial Performance Metrics for ampm Franchisees?
ampm franchisees can expect an average annual revenue of about $1,000,000 per unit, with a median revenue of $82,900. The highest reported annual revenue per unit is $1,400,000, while the lowest is $64,600. Additionally, franchisees can anticipate a breakeven time of approximately 12 months, making it vital to analyze these figures to gauge potential profitability and operational efficiency.
What Are the Ongoing Fees and Expenses for ampm Franchisees?
Owning an ampm franchise entails ongoing fees, including a royalty fee of 11% and a marketing fee of 5.5% of gross revenue. Franchisees should also budget for annual running expenses, which typically total between $77,280 and $81,280. These expenses cover rent, utilities, marketing, and administrative salaries, so it’s important to factor them into your financial planning to ensure sustained profitability.
What Support Does ampm Provide to Franchisees?
ampm offers comprehensive support to its franchisees, including training and operational guidance to help navigate the complexities of running a convenience store. Franchisees benefit from the brand's established reputation, marketing resources, and ongoing assistance in optimizing their business operations. This support structure is designed to empower franchisees, whether they are first-time owners or seasoned investors looking to expand their portfolios.
ampm Franchise Financial Requirements
Below, you’ll find an overview of the initial investment needed to launch the business, along with the ongoing fees required by the franchisor to maintain operations over time.
The minimum total assets (minus liabilities) you must possess.
Net Worth Required:
The estimated period to recoup your total investment.
Investment Payback:
The initial fee paid to join the franchise system.
Franchise Fee:
Ongoing percentage of revenue paid to the franchisor.
Royalty Fee:
Regular contribution toward the franchise’s advertising fund.
Marketing Fee:
The estimated timeframe to recover your initial costs.
Breakeven Time:
The total amount required to launch the franchise.
Initial Investment:
The minimum liquid capital you must have on hand.
Cash Required:
The typical yearly revenue generated per franchise location.
Average Revenue:
The middle value of yearly revenue among franchise locations.
Median Revenue:
The largest reported annual revenue among franchisees.
Highest Revenue:
The smallest reported annual revenue among franchisees.
Lowest Revenue:
A broad sector defining similar types of franchise businesses.
Industry:
A more specific division within the broader industry.
Category:
The key individuals guiding the franchise’s strategy and growth.
Leadership:
The official business address of the franchisor’s headquarters.
Corporate Address:
Available financing options to help start the franchise.
Funding Year:
The main organization that owns the franchise brand.
Parent Company:
ampm Franchise Unit Growth Summary
A breakdown of corporate, franchised, and total units, with yearly net changes.
Total Units
Franchised Units
Corporate Units
| Units | 2008 | 2009 | 2010 |
|---|---|---|---|
| Total Units | 510 | 325 | 217 |
| Net Change YoY | -185 | -108 | |
| Franchised Units | 334 | 245 | 208 |
| Net Change YoY | -89 | -37 | |
| Corporate Units | 176 | 80 | 9 |
| Net Change YoY | -96 | -71 |
Initial Investment
The ampm franchise offers a range of investment options, with a low initial investment starting at $313,861 and going up to $7,602,212. This flexibility allows aspiring franchisees to choose a model that aligns with their financial capacity and business goals, making it accessible for a variety of investors.
Franchise Fees
To become an ampm franchisee, an initial franchise fee of $30,000 is required. Additionally, franchisees must pay an ongoing royalty fee of 11% of gross sales, along with a marketing fee of 5.5%. These fees contribute to the overall support and resources provided by the franchisor.
Financial Requirements
Franchisees must demonstrate financial stability, with a cash requirement of $50,000 and a net worth requirement ranging from $500,000 to $1,000,000. This ensures that franchisees have the necessary resources to successfully operate their ampm location and withstand initial operational challenges.
Revenue Potential
ampm franchises show promising revenue potential, with average annual revenue per unit reported at $882,960. The median annual revenue is $82,900, while the revenue range spans from $64,600 to $1,400,000. This variability highlights the potential for growth and success in different market conditions.
Breakeven and Payback
Franchisees can expect to reach breakeven within 12 months, alongside an investment payback period of the same duration. This quick turnaround is appealing for those looking to minimize risk and maximize return on investment in a relatively short timeframe.
Company Growth
The ampm franchise has shown a dynamic growth pattern, with a total of 510 units in 2008, which decreased to 217 units by 2010. The franchise system has evolved, with a notable shift from corporate-owned units to franchised locations, emphasizing its commitment to expanding through franchising and empowering individual entrepreneurs.
Frequently Asked Questions
The initial investment for an ampm franchise ranges from $313,861 to $7,602,212, which includes the franchise fee, equipment, and other startup costs.