How to Buy a Franchise: Step-by-Step Investment Guide

Quick Answer

To buy a franchise, you must select a brand, review their Franchise Disclosure Document (FDD), secure financing, and sign a franchise agreement. Initial investments range from under $10,000 for service brands like Jan-Pro to over $4.7 million for major QSR brands like Burger King.

Source: FranchiseStack · July 2026

Based on an analysis of 192 franchises in FranchiseStack's database, the process of buying a franchise requires matching your available capital with a proven business model. Our data shows a massive variance in entry costs: real estate and home service franchises often require less than $50,000 (e.g., eXp Realty at $3K-$8K), while established food and retail brands typically require mid-to-high six-figure investments (e.g., Subway at $229K-$524K). Prospective owners must also account for ongoing royalty fees, which range from 0% at brands like RE/MAX to over 40% at 7-Eleven.

Key Data Points

Entry-level investments start as low as $3,000 (eXp Realty) and $4,000 (Jan-Pro).
High-capital food franchises can require up to $4.73 million (Burger King).
Royalty fees vary significantly, with many brands charging between 4% and 8% of gross sales.
Retail service brands like The UPS Store require mid-range capital between $178K and $403K.

Frequently Asked Questions

What is the first step in buying a franchise?

The first step is conducting market research and requesting the Franchise Disclosure Document (FDD) from brands that fit your budget and interest.

How much does it cost to buy a franchise?

Costs range from $3,000 for low-overhead service models to over $3 million for major restaurant chains like Taco Bell or McDonald's.

What are franchise royalty fees?

Royalties are ongoing payments to the franchisor for brand usage and support, typically ranging from 4% to 12% of monthly revenue, though some brands like Ace Hardware charge 0%.

Do I need experience to buy a franchise?

While helpful, many franchisors provide comprehensive training; however, they often have strict liquid capital and net worth requirements.

How long does it take to open a franchise?

The timeline varies by industry; service-based franchises can open in weeks, while brick-and-mortar locations like Dunkin' may take 6 to 12 months for site selection and construction.