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Description
Investment Icon

What Are the Initial Investment Requirements for a Junk King Franchise?

To open a Junk King franchise, you should prepare for an initial investment ranging from $93,300 to $180,000. This includes a franchise fee of $65,469. It's essential to have a cash requirement that aligns with this investment range, as well as a net worth of $500,000 to $1,000,000. These figures highlight the financial commitment needed to start your journey with Junk King, ensuring you are well-equipped to launch your business.

Fees Icon

What Are the Ongoing Fees Associated with a Junk King Franchise?

As a Junk King franchisee, you will be responsible for an ongoing royalty fee of 8% of your gross revenue, along with a marketing fee of 10%. These fees are crucial for supporting the brand's marketing efforts and maintaining operational standards. Understanding these ongoing financial obligations will help you plan your budget effectively and ensure your franchise remains profitable.

Revenue Icon

What Is the Average Revenue Potential for a Junk King Franchise?

The average annual revenue for a Junk King franchise unit is approximately $569,082, with a median revenue of $476,871. This indicates a strong revenue potential within the junk removal industry. However, it's essential to note the variability, with the lowest annual revenue recorded at $9,019 and the highest at $2,633,850. Such figures can help you assess the earning potential and set realistic financial goals for your franchise.

Breakeven Icon

How Quickly Can You Expect to Break Even with a Junk King Franchise?

Junk King franchisees can expect to break even within 12 months of operation. This quick turnaround is appealing for many entrepreneurs, as it suggests a relatively low risk associated with the investment. Additionally, the investment payback period is also 12 months, indicating that you could potentially recover your initial investment within the first year, provided you effectively manage your operations and marketing efforts.

Junk King 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.

Net Worth Required icon The minimum total assets (minus liabilities) you must possess.

i Net Worth Required:

$500,000 - $1,000,000
Investment Payback icon The estimated period to recoup your total investment.

i Investment Payback:

12 Months
Franchise Fee icon The initial fee paid to join the franchise system.

i Franchise Fee:

$65,469
Royalty Fee icon Ongoing percentage of revenue paid to the franchisor.

i Royalty Fee:

8%
Marketing Fee icon Regular contribution toward the franchise’s advertising fund.

i Marketing Fee:

10%
Breakeven Time icon The estimated timeframe to recover your initial costs.

i Breakeven Time:

12 Months
Initial Investment icon The total amount required to launch the franchise.

i Initial Investment:

$93,300 - $180,000
Cash Required icon The minimum liquid capital you must have on hand.

i Cash Required:

$93,300 - $180,000
Average Revenue icon The typical yearly revenue generated per franchise location.

i Average Revenue:

$569,082
Median Revenue icon The middle value of yearly revenue among franchise locations.

i Median Revenue:

$476,871
Highest Revenue icon The largest reported annual revenue among franchisees.

i Highest Revenue:

$2,633,850
Lowest Revenue icon The smallest reported annual revenue among franchisees.

i Lowest Revenue:

$9,019
Industry icon A broad sector defining similar types of franchise businesses.

i Industry:

Cleaning Franchises
Category icon A more specific division within the broader industry.

i Category:

Commercial Cleaning
Leadership icon The key individuals guiding the franchise’s strategy and growth.

i Leadership:

Michael Andreacchi
Corporate Address icon The official business address of the franchisor’s headquarters.

i Corporate Address:

377 Oyster Point Blvd., Suite 19, South San Francisco, California 94080
Funding Year icon Available financing options to help start the franchise.

i Funding Year:

2010
Parent Company icon The main organization that owns the franchise brand.

i Parent Company:

Junk King Franchise Systems, Inc.

Junk King Franchise Unit Growth Summary

A breakdown of corporate, franchised, and total units, with yearly net changes.

The overall number of operating franchise locations.

Total Units i

174
The number of locations owned by independent franchisees.

Franchised Units i

169
The number of locations owned and run by the franchisor.

Corporate Units i

5
Units 2021 2022 2023
Total Units 109 135 163
Net Change YoY 26 28
Franchised Units 103 132 158
Net Change YoY 29 26
Corporate Units 6 3 5
Net Change YoY -3 2
Investment About

Investment Overview

The Junk King franchise offers a low to moderate initial investment, ranging from $93,300 to $180,000. The franchise fee is set at $65,469, with ongoing royalty and marketing fees of 8% and 10% of gross sales, respectively. Potential franchisees should prepare for a cash requirement within the same range as the initial investment and must demonstrate a net worth between $500,000 and $1,000,000 to qualify for ownership.

Potential About

Revenue Potential

Franchisees can expect an average annual revenue of $569,082, with a median annual revenue of $476,871. The revenue potential varies significantly, with the lowest annual revenue recorded at $9,019 and the highest at $2,633,850. This wide range highlights the opportunity for franchisees to optimize their operations for greater profitability.

Metrics About

Breakeven and Payback

Junk King franchises typically achieve breakeven within 12 months, allowing owners to recoup their initial investments quickly. This rapid payback period is a significant advantage for aspiring entrepreneurs, as it provides a clearer path to profitability and financial stability in the early stages of operation.

Fees About

Franchise Growth

The Junk King franchise has shown consistent growth, increasing from 103 franchised units in 2021 to 158 in 2023. This upward trend indicates a strong market demand for junk removal services and reflects the brand's expanding footprint across various regions. The growth in franchised units suggests a robust support system for new franchisees entering the market.

Breakeven About

Financial Performance

Analyzing the average profit and loss figures reveals that the cost of goods sold (COGS) accounts for 29.8% of revenue, resulting in a gross profit margin of 78.2%. However, operating expenses represent 34.6% of revenue, leading to an EBITDA of -$24,572, or -4.3%. Understanding these financial metrics is crucial for franchisees to manage their operations effectively and improve profitability.

Units About

Operational Expenses

Franchisees should anticipate annual operating expenses totaling approximately $101,300. Key costs include rent ($24,000), utilities ($6,000), marketing and advertising ($10,000), and management salaries ($45,000). By closely monitoring these expenses, franchisees can identify areas for cost savings and enhance their overall financial performance.

Frequently Asked Questions

The initial investment for a Junk King franchise ranges from $93,300 to $180,000, which includes the franchise fee of $65,469.