A reasonable base scenario is about $53,000 per year before personal income taxes and financing principal. This is not passive business profit. It is an independent estimate of pre-tax owner benefit for an active owner, using 2025 Gross Revenue reported in the 2026 N-Hance Franchise Disclosure Document and a broad official repair-industry net-income benchmark. A manager-run model is materially weaker: after a full-time operator wage assumption, modeled residual earnings range from approximately -$49,000 to $49,000.
The $31,000–$128,000 range is an independent analytical scenario, not an Item 19 financial performance representation by Nhance, Inc. It combines identified FDD facts with separately identified IRS and BLS benchmarks and explicit sensitivity assumptions. Actual results can differ materially because of territory mix, number of franchises owned, job volume, pricing, technician labor, product usage, vehicle and occupancy costs, financing, owner involvement, local competition, and execution.
Legal franchisor: Nhance, Inc. FDD: issued March 30, 2026. Item 19 status: Gross Revenue only; no operating profit, EBITDA, net income, cash flow, owner compensation, or owner earnings disclosure. Applicable population: 67 U.S. Active Franchise Owners operating 180 Traditional and Small Market businesses for the full 2025 calendar year. Benchmark basis: IRS 2023 nonfarm sole-proprietor “Miscellaneous repairs” data and BLS May 2025 supervisor wages. Checked: July 18, 2026. Current brand and format descriptions are available on the official N-Hance U.S. franchise website.
What does the N-Hance FDD actually report?
The official disclosure reports Gross Revenue per Active Franchise Owner, not owner earnings and not revenue per single franchise territory. The applicable period is the year ended December 31, 2025, and the population combines Traditional and Small Market franchises. The figures were voluntarily reported, were not independently audited, and exclude owners who did not provide full-year revenue data or whose businesses were terminated, not renewed, or ceased operations.
The 2026 N-Hance FDD defines an Active Franchise Owner as a U.S. franchisee operating full time for all of 2025 and completing at least two jobs through an N-Hance business in every calendar month. Item 19 states that 67 Active Franchise Owners operated 180 businesses. Because most owners held several franchise agreements, the revenue table is a per-owner portfolio measure. It cannot be divided mechanically into a reliable per-unit earnings figure.
| Item 19 grouping | Owners | Average Gross Revenue | Median Gross Revenue | Range |
|---|---|---|---|---|
| Top 25% | 16 | $1,425,376 | $1,223,247 | $895,011–$2,851,291 |
| Top 50% | 33 | $1,009,610 | $791,786 | $402,668–$2,851,291 |
| All active reporting owners | 67 | $625,402 | $400,837 | $107,600–$2,851,291 |
| Bottom 75% | 51 | $374,429 | $303,250 | $107,600–$791,786 |
| Bottom 25% | 17 | $188,912 | $199,397 | $107,600–$250,472 |
Official source: 2026 N-Hance Franchise Disclosure Document, Item 19, pp. 50–51. “Gross Revenue” excludes sales tax and returns but includes revenue received from operating the business. Item 19 expressly states that operating costs must be deducted to obtain net income or profit.
The $400,837 median and $625,402 average are top-line owner-level Gross Revenue. They do not deduct technician payroll, proprietary products, vehicles, rent, insurance, royalty, Brand Marketing Fund contributions, local advertising, software, credit-card processing, interest, depreciation, or other operating expenses. The FTC’s franchise buyer guidance recommends checking Item 19 assumptions, population coverage, written substantiation, and whether the reported cohort resembles the business a buyer expects to operate.
How does the revenue evidence translate into annual owner benefit?
The modeled owner-operator benefit is approximately $31,000 in the Conservative scenario, $53,000 in the Base scenario, and $128,000 in the Upside scenario. These are independent pre-tax estimates for an active owner, not FDD-reported profit. The revenue anchors come from the 2025 Item 19 distribution; the margin anchor comes from the IRS 2023 “Miscellaneous repairs” sole-proprietor category, a broad official proxy that includes repair activities but is not specific to N-Hance or franchised cabinet refinishing.
Base benchmark margin = IRS net income less deficit ÷ business receipts = $3.230813 billion ÷ $24.438604 billion = 13.22%. Conservative and Upside margins apply the stated sensitivity of minus or plus 3 percentage points.
- Conservative revenue anchor: $303,250The median Gross Revenue within Item 19’s Bottom 75% grouping. This is a disclosed cohort statistic, not a probability forecast.
- Base revenue anchor: $400,837The official median Gross Revenue across all 67 Active Franchise Owners.
- Upside revenue anchor: $791,786The median Gross Revenue within Item 19’s Top 50% grouping. It represents a stronger disclosed cohort, not a guaranteed upper result.
- Margin sensitivity: 10.22%, 13.22%, and 16.22%The IRS benchmark is an all-in tax net-income measure. N-Hance fees are not subtracted a second time, avoiding double counting. The specific franchise fee structure remains a major comparability limitation.
Annual pre-tax owner benefit before financing principal; rounded to the nearest $1,000.
Interpretation: Revenue variation and margin variation compound. The Upside result is more than four times the Conservative result because both the revenue anchor and the assumed margin are higher.
Sources: 2026 N-Hance FDD, Item 19, pp. 50–51; IRS 2023 nonfarm sole-proprietorship statistics, Table 1. The Census Bureau NAICS description for 811420 identifies furniture refinishing within Reupholstery and Furniture Repair, but the IRS category used here is broader.
| Scenario | Gross Revenue anchor | Net-income margin | Owner-operator benefit | Manager-run residual |
|---|---|---|---|---|
| Conservative | $303,250 | 10.22% | $30,992 | -$48,859 |
| Base | $400,837 | 13.22% | $52,991 | -$26,861 |
| Upside | $791,786 | 16.22% | $128,428 | $48,576 |
Rounding: calculations use full-precision inputs; chart values are rounded to the nearest $1,000. The model excludes personal income taxes and financing principal. Because the IRS net-income proxy includes deductible business interest and depreciation, those items are implicitly included in the benchmark rather than separately modeled. Capital expenditures and owner-specific tax consequences are not estimated.
How much does active owner involvement change the result?
Active involvement can be the difference between a positive owner benefit and a negative manager-run residual at lower revenue levels. Item 15 permits an owner not to participate in direct daily operation, but a trained operator must run the business. The IRS Schedule C benchmark is treated here as an owner-operator benefit proxy because a sole proprietor cannot deduct their own salary or personal withdrawals. To estimate a manager-run result, the model subtracts a full-time operator wage of $79,851.
The wage assumption uses the May 2025 BLS median hourly wage of $38.39 for First-Line Supervisors of Mechanics, Installers, and Repairers, annualized at 2,080 hours. This occupation is an imperfect but relevant field-service supervision proxy. It excludes employer payroll taxes, benefits, recruiting costs, bonuses, and local wage variation, so a fully burdened manager could cost more.
The gap between the two markers is the modeled $79,850 value of full-time operator labor.
Interpretation: The Base scenario does not support a full-time operator at the national median wage assumption. A manager-run structure becomes positive only in the Upside case, and even then the residual is about $49,000 before personal taxes and financing principal.
Sources: 2026 N-Hance FDD, Item 15, p. 43; BLS May 2025 Occupational Employment and Wage Statistics; IRS Publication 334, which states that a sole proprietor cannot deduct their own salary or personal withdrawals.
The $79,850 difference is compensation for work performed, not passive profit. An active owner may handle sales, scheduling, customer relationships, estimating, technician supervision, quality control, and local marketing. A buyer comparing N-Hance with a salaried job should separate the market value of those duties from the business’s residual return on invested capital.
How much of revenue is committed before ordinary operating costs?
At least 16% of Gross Revenue is directed to royalty, Brand Marketing Fund, and local marketing requirements once percentage calculations exceed the contractual minimums. This official FDD structure applies before technician payroll, products consumed above the purchase minimum, vehicle costs, rent, insurance, card processing, and other overhead. At the Base revenue anchor of $400,837, the known percentage obligations plus selected fixed recurring items total approximately $73,200, or 18.3% of revenue.
| Recurring item | Official requirement | Base-revenue illustration | Treatment |
|---|---|---|---|
| Royalty | Greater of 6% of Gross Revenue or monthly minimum | $24,050 | 6% applies at $400,837 revenue |
| Brand Marketing Fund | Greater of 2% of Gross Revenue or monthly minimum after ramp period | $8,017 | 2% applies at the Base anchor |
| Local marketing | Greater of 8% of Gross Revenue or fixed monthly minimum | $32,067 | Separate from Brand Marketing Fund |
| Customer relationship software | $349 per month | $4,188 | Annualized fixed fee |
| Local website sub-site | $35 per month per site | $420 | Annualized for one site |
| Proprietary product purchase minimum | $4,430 per business per calendar year, CPI-adjustable | $4,430 | Purchase floor, not a profit measure |
| Known recurring outflows | Percentage obligations plus listed fixed items | $73,172 | 18.3% of Base revenue |
Official sources: 2026 N-Hance FDD, Item 6, pp. 12–20, and Item 11, pp. 33–34. The official N-Hance franchise costs and fees page confirms the current U.S. offer and directs prospects to the FDD for ongoing fees. The illustration assumes one business and one local website; multi-business owners may incur additional fixed charges and purchase minimums.
Are these obligations deducted again in the earnings scenarios?
No. The scenario margin is an all-in IRS net-income proxy, so subtracting the FDD obligations again would double count expenses. The fee table serves a different purpose: it shows why a broad non-franchise industry margin may not transfer cleanly to N-Hance. A buyer should replace the proxy with actual N-Hance franchisee profit-and-loss statements before relying on the scenario.
Why is the evidence confidence limited?
Confidence is limited because the FDD supplies strong owner-level revenue evidence but no same-brand operating-cost or profit evidence. The final range therefore depends materially on an external IRS margin proxy and an explicit ±3 percentage-point sensitivity. The largest unresolved question is the actual expense structure of comparable N-Hance owners after technician labor, proprietary products, required marketing, vehicles, occupancy, insurance, and management.
- Gross RevenueThe FDD’s top-line measure. It is not business profit, owner salary, distributions, or take-home pay.
- Estimated owner-operator benefitModeled cash earnings before personal taxes and financing principal, including the economic value of labor performed by an active owner.
- Manager-run residualOwner-operator benefit less the modeled full-time operator wage. It is before personal taxes and financing principal and excludes employer benefit load.
- Debt serviceNot included in the operating result. Interest is implicitly reflected in the IRS benchmark, but loan principal payments are separate cash outflows.
- Personal taxesNot estimated. Federal, state, local, self-employment, payroll, and entity-level outcomes depend on the owner’s structure and circumstances.
Item 19 excludes nonreporting owners and businesses that were terminated, not renewed, or ceased operations. Item 20 also shows that U.S. franchised businesses declined from 255 at the start of 2025 to 209 at year-end: 3 opened, 26 terminated, 22 were not renewed, and 1 ceased for another reason. That system movement does not prove why any outlet left, but it increases the importance of reviewing former-franchisee contacts and understanding whether the Item 19 cohort is representative. Official source: 2026 N-Hance FDD, Item 20, pp. 52–57.
What variables move the earnings range most?
Gross Revenue per owner and the cost of replacing owner labor are the two largest modeled drivers. Territory count also matters because the FDD’s owner-level results frequently represent several franchise agreements supported from one operating base. Other high-impact variables are lead cost, close rate, average job value, technician productivity, rework, proprietary product usage, travel time, local marketing efficiency, and whether an owner needs commercial space.
The official N-Hance earnings overview similarly identifies territory size, local demand, pricing, job volume, operational efficiency, customer experience, and reputation as performance drivers, while directing candidates to Item 19 rather than publishing a profit claim.
What should a buyer verify before relying on this range?
A buyer should treat the $31,000–$128,000 owner-operator range as a screening model and replace its external assumptions with same-brand evidence. The most useful next evidence is written Item 19 substantiation plus comparable franchisee profit-and-loss statements separated by owner role, territory count, business age, and format.
- Request written Item 19 substantiationConfirm how 2025 Gross Revenue was collected, validated, grouped, and reconciled, and ask whether any post-issuance material changes exist.
- Match the owner portfolioAsk each franchisee how many franchise agreements, territories, vehicles, technicians, websites, and operating locations support the reported owner-level revenue.
- Separate owner labor from residual profitRecord the owner’s weekly hours and duties, then price a replacement operator, salesperson, estimator, or production manager for the local market.
- Rebuild the actual operating statementVerify technician payroll and payroll burden, proprietary product cost, local advertising, lead fees, vehicle expense, rent, insurance, software, card processing, training, rework, and administrative overhead.
- Test the fee minimums by formatTraditional and Small Market franchises have different minimum royalty and local marketing thresholds. Determine which format and ramp period apply.
- Review Item 20 contacts and exitsInterview current and former franchisees, including owners with lower revenue and those who transferred, terminated, did not renew, or ceased operations.
- Model financing separatelyUse the buyer’s actual financed amount, rate, term, and repayment schedule. Do not subtract the initial investment from one year of revenue or describe loan principal as an operating expense.
What is the strongest defensible N-Hance owner-earnings range?
The strongest defensible range from the available evidence is approximately $31,000 to $128,000 in annual pre-tax owner-operator benefit, with a Base estimate near $53,000. The range is scenario-based, not official N-Hance profit data. Its main driver is Gross Revenue per active owner, while owner involvement determines whether the result represents compensation for work or residual business profit.
The largest unresolved uncertainty is the same-brand expense structure. Item 19 provides a meaningful 2025 revenue distribution but no operating profit, owner compensation, or net-income bridge. Under the modeled $79,850 operator wage, manager-run residual is negative in the Conservative and Base scenarios and approximately $49,000 in the Upside scenario. A buyer should verify the FDD’s written substantiation, obtain actual profit-and-loss data from comparable current franchisees, and interview former franchisees before treating any point in the range as applicable to a specific territory or ownership plan.