Home Inspection Franchise Cost – There are Hidden Costs
Choosing to open a home inspection franchise is a personal decision you should weigh. While there may be personal reasons as to why some may choose or not choose to open a home inspection franchise, there are some facts about the franchise costs and savings every inspector should consider. Knowing these facts will help you make the right decision for your business. Having all the information and facts will determine the true home inspection franchise cost, in the start up, and in the long term.
Some home inspection franchises can be as low as $17,000 to sign up for and begin working, while others can be well above the $100,000 mark. However, these are just the lump fees a franchise will require from you to sign up. Some other fees some franchisees may not thin of right away include royalty payments, service sales, updates and improvements, training and conferences, and free training.
Royalty Payments – Part of the Franchise Costs
Royalty payments are like rent; you have to pay them monthly, quarterly, or maybe yearly to the franchiser. These fees are solely for the privilege of using the franchiser’s brand name and systems in order to do business. In most cases, royalty fees are based on the amount you have made as a home inspector; however, some franchises may charge a set fee.
The costs of your services often are set by the franchiser, meaning you don’t get to choose how much you charge. This can be alright for some who are relying on the name of the franchise to bring in business, but this can be harmful to others who are trying to compete with other home inspectors in the area. The service fees charged by the franchise guarantee they will make a profit off every inspection you perform.
Updates and Improvements
Updates and improvements to the franchise system can become costly because the franchise can legally require you to make these updates and improvements without them fronting the cost. Some franchises will do this through a monthly subscript fee, while others might require the funding for this added cost up front.
Training and Conferences
Quarterly and annual conferences for franchisers are not unheard of, and while the franchiser may not be obtaining a profit from these, you still have to pay for lodging, food, and travel, in some cases. Other times, the franchiser may charge you for their time and effort in these conferences and training seminars, which can add up pretty quickly.
Free For Training
Lastly, some franchises retain the right to ask their franchisees to train other individuals looking to get into the home inspection market. Some franchises might deduct existing fees from the franchisee’s costs for their time and effort in training a new home inspector, while others might require the franchisee to do this service for free.
Some franchises will include all of these fees up front, which is why some of them appear to cost a lot more than others. Make sure to read the contract for the franchise agreement to understand your obligations to the franchise, as well as what they will and will not pay for. If something seems unclear in the contract, be proactive about having it explained.
Be sure to do your homework, so you are aware of all the home inspection franchise costs. Then you need to decide if its worth it to you in the long run. Most inspection franchise companies will want at least a 10 year commitment as well.