Understanding the Franchise Royalty Fee (and Other Key Expenses)

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It’s standard for franchisors to establish a number of fees in order to help cover the cost of services franchisees receive, and to make franchising profitable for them as well as their franchisees. Our sign business franchising costs fall into this category, and one of the key expenses you should be sure to understand before franchising is our ongoing royalty fee. Here’s a quick look at what you should expect to pay, along with a few other expenses to keep in mind when you invest.

Our Modest Royalty Fee

One important sign business franchising cost is the royalty fee, which helps cover the costs of the many resources our franchisees enjoy. In addition to the use of our well-established brand name, they have access to ongoing training and support, marketing assistance, business coaching, and much more. The exact amount you’ll pay for your royalty fee will depend on how profitable your franchise is – for many of our franchisees, this amount comes to 6% of their gross sales, due monthly. Given the many perks of franchising with Signarama, our franchisees find that this monthly fee is well worth the cost and might even pay for itself when they consider benefits like discounts from our vendor network.

Marketing Fund Fee

In addition to the ongoing royalty payments, our franchisees pay 1% of their gross sales as towards a marketing fund fee (up to $1,500). This fee helps to cover some of the costs of our larger marketing efforts that drive awareness of the Signarama in your community and nationwide. The best way to get a clearer picture of exactly which marketing expenses this sign business franchising cost goes towards is to request a copy of our franchise disclosure document.

Initial Franchise Fee

Signarama invests many resources into the opening of each new franchise: location scouting, training, and grand opening assistance are just a few of the ways we help our franchisees. Not only does our initial franchise fee grant franchisees access to our well-established brand name, but it also helps offset costs like these. We estimate that the total investment in a new Signarama franchise will run between $185K-$195K, and the initial franchise fee of $49,500 is included in that estimate.

Some prospective franchisees wonder why they should partner with a brand like Signarama that assesses fees when they could open their own sign business and not have to worry about these expenses. However, opening a new business can be tricky and there are many variables involved. Signarama has been in business for over 30 years, and our expertise gives us unique insight into exactly what it takes to get a new sign franchise up and running quickly and efficiently. Our time-tested business model allows franchisees to hit the ground running without needing to develop their own operations procedures. All in all, our franchisees find that our guidance helps them to start off strong without wasting any time reinventing the wheel – and that makes each of these fees well worth the expense!

The best way to learn about our sign business franchising costs is to review our franchise disclosure document – contact us today to request a copy!

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