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ATAX Franchise ProfileAccounting & Financial Franchises > Tax Services |
What Are the Initial Investment Requirements for an ATAX Franchise?
To open an ATAX franchise, you should prepare for an initial investment ranging from $62,650 to $79,000. This includes a franchise fee of $35,000. Additionally, you will need to have a net worth between $100,000 and $500,000. It's crucial to ensure you have the necessary cash on hand, as this will be essential for covering startup costs and meeting ongoing financial obligations.
What Are the Ongoing Fees for ATAX Franchise Owners?
ATAX franchisees are required to pay a royalty fee of 14% on their revenue, along with a marketing fee of 3%. These ongoing costs are important to factor into your financial planning, as they contribute to the overall operational expenses of running your franchise. Understanding these fees will help you manage your budget effectively and maintain profitability.
What Is the Average Revenue Potential for an ATAX Franchise?
The average annual revenue per ATAX unit is approximately $170,285, with a median annual revenue of around $94,750. While the lowest annual revenue recorded is $3,820, the highest can reach up to $1,154,230. This wide range indicates that revenue potential can vary significantly based on location, management, and market demand, making it essential to conduct thorough market research before investing.
How Quickly Can You Expect to Break Even with an ATAX Franchise?
Franchisees can anticipate a breakeven time of about 12 months, with an investment payback period of approximately 10 months. This relatively swift return on investment is appealing for aspiring franchise owners, as it suggests that with effective management and marketing, you can start seeing profits in the first year of operation. Understanding these timelines can aid in setting realistic financial expectations.
ATAX 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:
ATAX Franchise Unit Growth Summary
A breakdown of corporate, franchised, and total units, with yearly net changes.
Total Units
Franchised Units
Corporate Units
| Units | 2021 | 2022 | 2023 |
|---|---|---|---|
| Total Units | 58 | 70 | 98 |
| Net Change YoY | 12 | 28 | |
| Franchised Units | 58 | 70 | 98 |
| Net Change YoY | 12 | 28 | |
| Corporate Units | 0 | 1 | 2 |
| Net Change YoY | 1 | 1 |
Initial Investment
The ATAX franchise offers a low initial investment ranging from $62,650 to $79,000. This includes a franchise fee of $35,000. The cash required to start an ATAX unit falls within the same range, making it accessible for aspiring entrepreneurs looking to enter the tax preparation industry.
Financial Performance
Franchisees can expect an average annual revenue of approximately $170,285 per unit, with a median revenue of $94,750. The revenue figures highlight the potential profitability of an ATAX franchise, though it’s important to note that some units may generate significantly lower or higher revenues, with extremes ranging from $3,820 to $1,154,230.
Royalty and Marketing Fees
ATAX charges a royalty fee of 14% on gross sales, along with a marketing fee of 3%. These fees contribute to the overall operational costs but also support brand development and marketing efforts that benefit all franchisees.
Breakeven and Payback Period
Franchisees can anticipate a breakeven period of about 12 months, with an investment payback timeline of approximately 10 months. This relatively quick return on investment can be appealing for those looking to establish a profitable business in a short timeframe.
Growth and Expansion
The ATAX franchise has shown consistent growth, increasing from 58 franchised units in 2021 to 98 in 2023. This expansion indicates a strong demand for their services and a growing brand presence in the tax preparation market.
Corporate Structure
ATAX is structured to support franchisees with corporate units. As of 2023, there are 2 corporate-owned locations, which allows the franchisor to directly manage and refine operational practices that can benefit franchisees across the network.
Frequently Asked Questions
The initial investment for an ATAX franchise ranges from $62,650 to $79,000. This includes the franchise fee and other startup costs necessary to launch the business.