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Hello Garage Franchise ProfileHome Based Franchises > Home Repair Services |
What Are the Initial Investment Requirements for a Hello Garage Franchise?
To open a Hello Garage franchise, you will need to prepare for an initial investment ranging from $130,828 to $160,334. This includes a franchise fee of $49,500 and additional costs related to equipment, inventory, and setup. It's essential to have a net worth between $300,000 and $500,000, along with sufficient cash reserves to cover these upfront costs. Understanding these financial commitments is crucial for aspiring franchisees.
What Are the Ongoing Fees Associated with a Hello Garage Franchise?
Hello Garage franchisees are required to pay a royalty fee of 3% on gross sales, along with a marketing fee of 3%. These ongoing fees contribute to the overall operational costs and support the brand’s marketing efforts. Being aware of these fees will help you prepare your financial plan and ensure that you can maintain profitability while adhering to the franchise's standards.
What Is the Average Revenue Potential for a Hello Garage Franchise?
The average annual revenue per unit for a Hello Garage franchise is approximately $706,035, with a median revenue of $651,853. Revenue can vary significantly, with the lowest reported annual revenue at $102,776 and the highest at $1,384,509. Understanding these figures can help you gauge the potential profitability of your investment and set realistic financial goals for your franchise.
How Long Does It Typically Take to Break Even with a Hello Garage Franchise?
Franchisees can expect to reach breakeven within about 12 months of operation. With an investment payback period of approximately 21 months, this timeline indicates that Hello Garage offers a relatively quick return on investment compared to other franchise opportunities. This information is vital for financial planning and assessing the viability of your franchise venture.
Hello Garage 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:
Hello Garage 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 | 18 | 20 | 26 |
| Net Change YoY | 2 | 6 | |
| Franchised Units | 9 | 10 | 13 |
| Net Change YoY | 1 | 3 | |
| Corporate Units | 9 | 10 | 13 |
| Net Change YoY | 1 | 3 |
Investment Overview
Hello Garage offers a low initial investment range of $130,828 to $160,334, making it an accessible opportunity for aspiring franchisees. The initial franchise fee is set at $49,500, with ongoing royalty and marketing fees of 3% each. This financial structure supports franchisees in establishing their business while maintaining a manageable cost base.
Revenue Potential
Franchisees can expect strong revenue potential, with average annual revenue per unit reported at $706,035 and a median of $651,853. The revenue range varies significantly, from $102,776 at the lowest to $1,384,509 at the highest, indicating the opportunity for substantial earnings depending on market conditions and operational efficiency.
Breakeven and Payback Period
Franchisees typically reach breakeven within 12 months of operation, providing a relatively quick return on investment. The average investment payback period is around 21 months, allowing franchisees to recoup their initial investment and start generating profit in a reasonable timeframe.
Unit Growth
Hello Garage has demonstrated steady growth in franchised units, increasing from 9 units in 2021 to 13 units in 2023. This trend reflects the brand's expanding market presence and the increasing interest from potential franchisees, highlighting the viability of the franchise model.
Financial Performance
The average financial performance shows that Hello Garage units generate significant revenue, with total operating expenses averaging $5,307,492. While the brand faces challenges with EBITDA reported at -$282,208, the gross profit margin of 62.2% indicates strong potential for profitability with effective cost management.
Franchise Support
Hello Garage provides comprehensive support to franchisees, including training, marketing, and operational assistance. This robust support system is essential for new franchisees to navigate the initial challenges of starting their business and to optimize their long-term success within the franchise network.
Frequently Asked Questions
The total initial investment for a Hello Garage franchise ranges from $130,828 to $160,334, which includes the initial franchise fee and other startup costs.