How Much Does a Fresh Coat Franchise Owner Make?

A manager-run Fresh Coat territory may produce roughly a $95,000 loss to $81,000 of pre-tax owner earnings in the modeled range, while an active owner replacing the manager may receive an estimated owner-operator benefit of about $10,000 to $186,000. These are scenario results for one year-four-or-later territory, not official owner-income figures. The central scenario produces approximately $1,000 for a manager-run owner and $106,000 of owner-operator benefit.

The owner-operator figure is not pure business profit. It combines residual operating profit with the modeled market value of management labor performed by the owner. The manager-run result treats a $105,260 manager wage as an operating expense. Neither result is after-tax take-home pay, and neither includes financing interest or principal payments.

What do the three scenarios show?

The scenarios show that owner role changes the modeled annual economic result by about $105,260, the BLS construction-industry manager-wage benchmark. Revenue and Gross Profit anchors come from separate statistics within the same 2025 Item 19 population; they are not a single observed territory’s paired results.

Rounded to the nearest $1,000. “Conservative,” “Base,” and “Upside” are analytical labels, not probabilities. Source anchors: 2026 Fresh Coat FDD, Item 19, pp. 27–29. Operating assumptions are detailed below.

Item 19 officially reports Gross Revenue and Gross Profit percentages, not owner earnings. The 2025 table covers 62 full-time U.S. franchised territories that operated throughout the year and submitted complete monthly revenue and annual income-statement information. Fresh Coat had 182 territories in operation at year-end, owned by 132 franchisees, and no company-owned outlets.

The FDD defines Gross Revenue on an accrual basis as amounts billed, net of client refunds, discounts, and separately stated sales or excise taxes. It defines Gross Profit as Gross Revenue minus direct labor and paint. Item 19 explicitly says these figures do not include the other operating costs needed to determine net income or profit. That limitation is why the evidence mode is FDD-anchored scenario estimate rather than official earnings disclosure.

Official values from the 2026 Fresh Coat FDD, Item 19, pp. 27–29. The cumulative median Gross Profit percentage is 40.0%; the table above uses the disclosed average percentage for a consistent quartile comparison.

How representative is the Item 19 cohort?

The official cohort represents 62 of 182 year-end territories, or 34.1%, and therefore excludes most of the system. Excluded territories include those not open for the full year, not operated full time, missing one or more monthly Gross Revenue reports, or missing the required income statement. The sample is per territory, not per owner, so it does not disclose the earnings of multi-territory portfolios.

Item 20 reports that the franchised system moved from 187 territories at the start of 2025 to 182 at year-end. During 2025, 23 outlets opened, 13 were terminated, one was not renewed, seven were reacquired, and seven ceased operations for other reasons. These counts provide population context but do not establish why any particular territory opened, transferred, or closed. Source: 2026 Fresh Coat FDD, Item 20, pp. 30–36.

The model starts with Item 19 Gross Profit, then subtracts recurring franchise obligations, insurance, modeled overhead, and—only for the manager-run case—a manager wage. This is a bottom-up analytical bridge. It does not treat Item 7 startup investment as an annual expense.

Which assumptions are official and which are editorial?

Gross Revenue, Gross Profit percentages, royalty, branding, local-advertising requirements, technology fees, insurance range, and owner-participation rules are official FDD facts; the unreported overhead ratios and scenario pairings are editorial assumptions. The following treatments apply to all three scenarios.

• Revenue and Gross Profit: Conservative uses the fourth-quartile medians, Base uses cumulative medians, and Upside uses first-quartile medians. Each pairing is analytical because Item 19 does not identify a single territory with both values.
• Royalty: The model uses 6% of Gross Revenue. Item 6 permits a 5% rate above $1 million and 4% above $2 million, subject to good standing, application, and timing rules. Keeping 6% avoids assuming that a reduction applies for the full modeled year.
• National branding: 2% of Gross Revenue, with the $350 monthly minimum tested. The percentage exceeds the minimum in all three scenarios.
• Local advertising: The mature model uses the greater of 8% of Gross Revenue or $3,000 per month. The Conservative scenario therefore uses the $36,000 annual minimum. During the first three years, the requirement is the greater of 10% or $3,000 per month.
• Technology and insurance: Technology is $499 monthly. Insurance uses $8,000, $5,400, and $2,800 across the three scenarios, spanning the Item 7 annual range.
• Other operating overhead: 7%, 6%, and 5% of revenue cover unitemized office, vehicle, answering, estimating, accounting, licensing, travel, administrative, and similar costs. These are editorial assumptions because Item 19 does not disclose them.
• Manager wage: $105,260 is the BLS May 2024 construction-industry median wage for general and operations managers. It excludes employer payroll taxes and benefits, so a fully loaded manager cost could be higher.
• Excluded items: Financing interest, loan principal, depreciation, capital expenditures, owner personal income taxes, and after-tax distributions are not modeled. Fresh Coat Item 10 states that the franchisor does not offer or guarantee financing.

Active involvement can turn the value of a manager position into owner-operator benefit, but it does not create passive profit. Item 15 does not require the owner personally to supervise the business, although Fresh Coat recommends personal supervision. Each franchised business must be directly supervised by an approved, trained manager, and each additional franchised business must have its own full-time manager or marketing employee.

In a manager-run structure, the modeled residual belongs to the owner before financing and personal taxes, but only after the manager wage. In an owner-operated structure, the owner performs that management labor and the model adds the $105,260 wage benchmark back to the residual. The resulting benefit compensates the owner for operating work that may include sales, scheduling, project oversight, staffing, budgeting, and general administration.

Is Fresh Coat a passive-income model?

The available evidence does not support calling Fresh Coat passive. The FDD allows a non-owner manager, but that manager has a material economic cost, and the base scenario leaves only about $1,000 after the wage benchmark. A manager-run owner may still perform oversight, capital allocation, hiring, and accountability functions, none of which is valued separately in the scenario.

The official U.S. Fresh Coat franchise website describes a home-based model, while the official investment page lists the current initial fee and investment range. Those pages help define the offer but do not replace Item 19 for financial performance evidence.

The largest unresolved uncertainty is the amount of operating expense below Gross Profit, especially manager compensation, sales and administrative labor, local advertising efficiency, and unreported overhead. Item 19 stops before net income. At the $653,107 base revenue, every one-percentage-point change in Gross Profit or recurring expense changes annual earnings by about $6,531.

The next uncertainty is cohort comparability. The 62-territory Item 19 sample excludes about two-thirds of year-end territories, and the FDD does not provide results by territory age, owner-operated versus manager-run status, residential versus commercial project mix, geography, debt load, or number of territories per owner. It also does not pair each revenue statistic with the corresponding Gross Profit percentage.

What should a buyer verify before relying on an earnings estimate?

A buyer should reconcile the scenario against Item 19 substantiation and real franchisee profit-and-loss statements before treating any number as decision-grade. The most useful checks are specific, role-aware, and territory-level.

• Request the written substantiation for the 2025 Item 19 table and written clarification of the second-quartile Gross Profit inconsistency.
• Ask for the number of eligible and excluded territories by age, sales quartile, owner-operated status, manager-run status, and number of territories per owner.
• Interview current and former franchisees from Item 20 about actual owner salary, owner draw, distributions, retained earnings, manager payroll, payroll burden, and weekly owner hours.
• Obtain full-year profit-and-loss statements that separately show direct labor, paint, royalty, national branding, local advertising, technology, insurance, office, vehicle, administrative labor, and professional fees.
• Verify whether the local territory is subject to the $3,000 monthly advertising minimum and whether cooperative advertising could add another contribution.
• Confirm the timing and eligibility rules for any royalty-rate reduction above $1 million of annual Gross Revenue.
• Model financing interest and principal separately using the buyer’s actual loan terms; do not treat operating earnings as cash available after debt service.
• Compare continuing, transferred, terminated, reacquired, and closed territories without assuming that Item 20 status alone proves profitability or failure.

The strongest defensible annual range is approximately −$95,000 to $81,000 for a manager-run territory and $10,000 to $186,000 for estimated owner-operator benefit. The range is scenario-based, not an official Fresh Coat earnings claim. Sales volume and the Gross Profit percentage determine the starting pool, but owner involvement is the largest modeled earnings driver because the manager-wage benchmark is $105,260.

The largest unresolved issue is the expense structure below Item 19 Gross Profit. A prospective buyer should verify the franchisor’s written Item 19 substantiation, reconcile the model to territory-level profit-and-loss statements, clarify the inconsistent Gross Profit cell, and interview both continuing and former franchisees about owner hours, manager cost, advertising efficiency, debt service, and actual cash distributions.

Primary FDD references: 2026 Fresh Coat Franchise Disclosure Document, issued April 17, 2026; Item 6, pp. 5–9; Item 7, pp. 9–11; Item 15, p. 23; Item 19, pp. 27–29; Item 20, pp. 30–36. Monetary scenarios use U.S. dollars and are rounded only after full-precision calculations.