How Much Can You Make as a Franchise Owner?

The Big Question

One of the first questions prospective franchise owners ask is:

• “How much do franchisees make per year?”

• “What’s the average profit or salary of a franchise owner?”

• “Am I buying a job, or building wealth?”

The honest answer: it depends. Your income in franchising is shaped by several factors, from the franchise system you choose to the role you play in the business. This article breaks down those factors in a clear sequence so you can understand the drivers of franchise earnings.

Reality Check Before the Numbers

1. Cash Flow ≠ Your Paycheck

Net operating income is not the same as owner income. Out of your monthly profit, you must set aside money for:

• Reserves: at least 2–3 months of expenses.

• CAPEX (growth investments): vehicles, equipment, remodels, or extra territories.

• Marketing: campaigns are paid before sales come in.

• Taxes.

If you pocket every dollar of net income, you will starve the business. That’s why owners often pay themselves less in the early years, even when the business is “profitable.”

2. Reserves Grow as the Business Grows

Bigger businesses require bigger safety nets. As expenses and growth opportunities expand, your reserves need to scale. This reality makes early reinvestment critical.

Factors That Drive Your Income

Did You Budget a Salary Before Launch?

When you build your financial model, add a manager’s salary line item from day one. This forces you to be realistic about whether the business can support both operations and your household. Banks won’t approve an inflated salary, but penciling in a modest one ensures you don’t end up working full-time with no pay.

The Franchise System You Choose

Some systems have sky-high average revenues, others struggle with closures. What matters:

• Average unit economics (Item 19 in the FDD).

• Industry growth rates (steady 2–3%+ per year is a good baseline).

• System stability (low closure rates, supportive franchisor).

Item 19 from The Franchise Disclosure Document:

Financial Earnings Claims

Below are the earnings claims from some big names in their respective industries. You will see that some average millions of dollars while others average a few hundred thousand. The average income of the first franchise is more than the average revenue of the last franchise. Why would you even consider the last one?

Some people purchase a franchise without diving deep into this document which means they are set up for small returns before they even start. Don't be like them.

Automotive Shop

Mobile Restoration Franchise

Retail Franchise

Well Known Home Services Franchise

Factors That Drive Your Income (continued)

The Franchisor’s Rules

Not every franchisor lets you scale indefinitely. Some cap ownership at a percentage of total units. If you want to grow into a 10+ unit operator, make sure the system allows it.

Your Role in the Business

• Owner-operator: If you’re the manager, you’ll save payroll and likely pay yourself sooner.

• CEO from day one: If you hire a manager, salesperson, and staff immediately, you’ll need more working capital and it will take longer before you see personal income.

Scale: 1 Unit vs 10 Units

The path to high income usually involves multi-unit ownership. For example:

• 1 unit: $200K net before owner distributions.

• 10 units: After managers, district managers, and a CFO, you might net $550K.

• 15 units: With leverage in management layers, you could reach $700K–$1.1M.

How Good of an Operator Are You?

Two franchisees in the same system, same market, can have wildly different results. Leadership, grit, and the ability to follow a system separate the million-dollar owners from those who fail.

Timeline: Years 1–5

• Year 1: Often breakeven or small salary. Stressful.

• Year 2: Possible to match a corporate salary, but still hands-on.

• Year 3–5: If executed well, many owners start to outpace their old jobs. Some scale into multi-unit wealth; others stall.

So, How Much Can You Make?

There is no universal answer. But here’s the truth:

• Single-unit, owner-operator franchises can provide a strong salary (often $75K–$200K).

• Multi-unit franchisees with 5–15+ units can reach $500K–$1M+ annually, with systems and teams in place.

• Poor fit, bad franchisors, or weak execution can wipe out your investment entirely.

Franchising can create wealth, but it’s not guaranteed. Success requires picking the right system, reinvesting profits, and grinding through the first few years.

If you want help finding the right franchise and building a realistic income plan, reach out at tracerfranchising.com.