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Description
Investment Icon

What is the Initial Investment for a Kumon Franchise?

To open a Kumon franchise, the initial investment ranges from $65,500 to $73,783. This includes a franchise fee of $2,000. Additionally, potential franchisees should be prepared for ongoing costs, such as a royalty fee of 40% and a marketing fee of 10%. It's essential to ensure you have the necessary cash reserves, which should be between $73,783 and $165,920, along with a net worth requirement of $100,000 to $150,000.

Fees Icon

What is the Financial Performance of a Kumon Franchise?

Kumon franchises have demonstrated strong financial performance, with an average annual revenue per unit of approximately $93,490. The median annual revenue is slightly lower at $87,901, while some units report revenues as low as $30,000 and as high as $1,200,000. With a breakeven time of about 12 months and an investment payback period of 24 months, the franchise presents a potentially lucrative opportunity for investors.

Revenue Icon

What Are the Typical Expenses for Running a Kumon Franchise?

Running a Kumon franchise involves various expenses that can total between $73,783 and $165,920 annually. Key expenses include rent, which can range from $3,000 to $7,000, and payroll costs for assistants, estimated between $10,725 and $12,870 for three months. Other costs include utilities, professional fees, insurance, and business licenses. Understanding these expenses is crucial for effective financial planning and management.

Breakeven Icon

How Many Kumon Franchises Are Currently Operating?

As of 2023, there are 1,618 franchised Kumon units in operation, with a slight increase from 1,606 in 2022. The total number of Kumon units has also grown, reaching 1,640. While the number of corporate-owned units has decreased from 31 in 2021 to 22 in 2023, the overall growth in franchised units indicates a robust franchise model that attracts new investors and supports existing franchisees.

Kumon 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:

$100,000 - $150,000
Investment Payback icon The estimated period to recoup your total investment.

i Investment Payback:

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

i Franchise Fee:

$2,000
Royalty Fee icon Ongoing percentage of revenue paid to the franchisor.

i Royalty Fee:

40%
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:

$73,783 - $65,500
Cash Required icon The minimum liquid capital you must have on hand.

i Cash Required:

$73,783 - $165,920
Average Revenue icon The typical yearly revenue generated per franchise location.

i Average Revenue:

$93,490
Median Revenue icon The middle value of yearly revenue among franchise locations.

i Median Revenue:

$87,901
Highest Revenue icon The largest reported annual revenue among franchisees.

i Highest Revenue:

$1,200,000
Lowest Revenue icon The smallest reported annual revenue among franchisees.

i Lowest Revenue:

$30,000
Industry icon A broad sector defining similar types of franchise businesses.

i Industry:

Children’s Franchises
Category icon A more specific division within the broader industry.

i Category:

Education & Tutoring
Leadership icon The key individuals guiding the franchise’s strategy and growth.

i Leadership:

Minoru Tanabe
Corporate Address icon The official business address of the franchisor’s headquarters.

i Corporate Address:

55 Challenger Road, Ridgefield Park, New Jersey 07660
Funding Year icon Available financing options to help start the franchise.

i Funding Year:

2001
Parent Company icon The main organization that owns the franchise brand.

i Parent Company:

Kumon North America, Inc.

Kumon 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

1640
The number of locations owned by independent franchisees.

Franchised Units i

1618
The number of locations owned and run by the franchisor.

Corporate Units i

22
Units 2021 2022 2023
Total Units 1599 1634 1640
Net Change YoY 35 6
Franchised Units 1568 1606 1618
Net Change YoY 38 12
Corporate Units 31 28 22
Net Change YoY -3 -6
Investment About

Investment Overview

The initial investment for a Kumon franchise ranges from $65,500 to $73,783. This includes a franchise fee of $2,000, with additional costs for marketing (10% of gross sales) and royalties (40% of gross sales). Aspiring franchisees should also prepare for a cash requirement between $73,783 and $165,920, depending on their specific setup and operational needs.

Potential About

Revenue Potential

Kumon franchises have shown promising revenue potential, with average annual revenue per unit at $93,490 and a median of $87,901. The range of annual revenue varies significantly, from as low as $30,000 to as high as $1,200,000, indicating that individual performance can differ based on location and management effectiveness.

Metrics About

Breakeven and Payback

Franchisees can expect to reach breakeven within approximately 12 months of operation. The investment payback period is estimated at around 24 months, allowing franchisees to recoup their initial investment relatively quickly if they effectively manage their operations and marketing efforts.

Fees About

Franchise Growth

Kumon has experienced steady growth in its franchised units, increasing from 1,568 in 2021 to 1,618 in 2023. This growth trend reflects the brand's ongoing appeal and the increasing demand for supplemental education services, positioning franchisees for potential long-term success in a growing market.

Breakeven About

Corporate Structure

Kumon operates both franchised and corporate units. As of 2023, there are 1,618 franchised units and 22 corporate units. This structure allows Kumon to leverage both franchisee investments and corporate resources to support brand growth and operational consistency across locations.

Units About

Operational Costs

Franchisees should anticipate various operating expenses, which can include rent ($3,000 - $7,000 annually), payroll for assistants (approximately $10,725 - $12,870 for three months), and utilities ($16,160 - $21,660). Understanding these costs is crucial for effective financial planning and maintaining profitability within the franchise model.

Frequently Asked Questions

The initial investment for a Kumon franchise ranges from $65,500 to $73,783, which includes the initial franchise fee of $2,000 and other startup costs.