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Franchise Startup Cost
It is common for there to be confusion between out of pocket cost vs total investment cost for a franchise.
Start costs are considered out of pocket costs, or the amount of money you will need upfront to get started with a franchise. This amount can vary in relationship to your personal budget needs, amount financed, and equipment needs.
Total investment cost includes money out of pocket and loans to finance your initial franchise investment. Your total investment differs from start-up costs, which are required for you to launch your business.
A comparison can be made between buying a home and starting a business. An initial down payment on the home (start cost) will get you moved in, and the mortgage (total investment cost) are required to continue living there.
Matco Tools Total Franchise Costs
| From | Up to |
Initial Franchise Fee | $10,000 | $10,000 |
Initial Inventory | $55,000 | $92,000 |
Acquisition and Establishment of Time Payment Reserve OR Time Payment Line of Credit | $22,000 OR $4,700 | $22,000 OR $9,325 |
Mobile Store Lease | $3,316.50 | $169,447 |
Computer Hardware | $3,100 | $4,200 |
Computer Software and Internet Service - 3 months' payments | $2,050 | $3,250 |
Insurance - 3 months' premiums | $768 | $3,118 |
Travel, Lodging and Meals (for training) | $179 | $2,967 |
Professional Services (accountant, legal help for you) | $310 | $5,852 |
Fixtures, Supplies, Licenses | $525 | $4,400 |
Additional Funds - 3 months' living expenses (reserve) | $5,000 | $13,500 |
Total | $107,476 | $340,059 |
Matco cannot give any specific numbers because of the variables and the franchise disclosure laws don't allow us to give any specific income numbers.
*Cost per Matco Tools 2024 FDD issued March 6, 2024.
Franchise Investment Overview
Matco, backed by one of the largest companies in the country, handles all franchise investment financing in our office.
If you qualify, Matco can finance:
• Up to $92,000 of the initial inventory
• Time Payment Reserve (all or part)
• $30,000 to cover other startup expenses
Each situation varies based on your finances, however, the investment needed for a new franchisee can be relatively low compared to other franchise opportunities.
Franchise Startup Costs Include
Your Initial Inventory
We’ll start you with an initial inventory of the tools most likely to be purchased by your customers. Almost all distributors finance their initial inventory, which in 2022 ranges between $55,000 and $92,000.
A Time Payment Reserve Account
Upwards of 70% of a distributor’s customers pay "on time" (like a credit card account). You’ll need to fund this account so that you can begin offering time-based payments to customers immediately.
Your Truck Lease
This is generally a much smaller figure, as you’ll need to pay for three months of the lease and insurance.
Professional Supplies and Systems
This includes a computer, software, and items like business cards and office supplies.