This is an estimated pre-tax owner-operator benefit for a full-year, one-location SCA Appraisal Services business, with a modeled base result of about $39,000. It assumes the owner performs the full-time Designated Appraiser role. The 2026 Franchise Disclosure Document reports Annual Gross Revenue, not owner earnings or profit.
This range is an independent analytical scenario, not an Item 19 financial performance representation by SCA Franchising Corporation. It combines identified FDD facts with separately identified cost and workload assumptions. Actual results can differ materially because of territory demand, file volume, assignment pricing, travel, software, insurance, staffing, Elite Program qualification, financing, owner involvement, and execution.
Limited confidence. The current FDD provides unusually granular revenue and file-count data, but it does not provide operating expenses, Operating Profit, EBITDA, Net Income, Owner Compensation, or Cash Flow. The earnings range therefore depends materially on explicit operating-cost assumptions and an external labor benchmark.
The applicable offer is the U.S. SCA Appraisal Services franchise issued by SCA Franchising Corporation. No public, franchise-controlled copy of the matching FDD was verified, so FDD references below are plain-text citations by year, Item, and page.
What does the 2026 FDD actually disclose?
Officially, Item 19 discloses Annual Gross Revenue and completed appraisal files, not owner earnings. The latest 2025 Measurement Period covers April 1, 2025 through March 31, 2026 and represents 82 franchised locations. The table identifies each reporting record, its number of locations, file count, and revenue; three records operated for only part of the period. Source: 2026 SCA Franchise Disclosure Document, Item 19, pp. 33-45.
| Population view | Reporting records | Locations represented | Use in this analysis |
|---|---|---|---|
| All records with 2025 revenue | 53 | 82 | Official table population; includes three partial-year records and multi-location portfolios. |
| Full-year records | 50 | 79 | Derived cohort after excluding the three records marked partial-year. |
| Full-year, one-location records | 35 | 35 | Primary revenue cohort for a single-location owner scenario. |
Full-year records reporting one location in the 2025 Measurement Period.
25th-to-75th percentile range calculated from the 35-record cohort.
Annual file count for the same full-year, one-location cohort.
Applied to Gross Revenue under Item 6.
Available only when weekly performance criteria are satisfied for eligible assignments.
BLS May 2023 median for Insurance Appraisers, Auto Damage; excludes self-employed workers.
The derived $129,547 median is revenue before the 50% Continuing Royalty and before vehicle, insurance, software, licensing, accounting, staffing, financing, and tax costs. The $176,827 cohort average is higher than the median because several high-revenue records pull the average upward; the median is the more stable central anchor for this owner-level analysis.
How is the $26,000-$73,000 owner-operator range calculated?
The range is an independent estimate for an active owner operating one location for a full year. Conservative, Base, and Upside revenue anchors use the derived 25th percentile, median, and 75th percentile of the 35 one-location records. Each scenario applies the official 50% standard royalty and the same transparent operating-cost framework.
| Scenario | Annual Gross Revenue | 50% royalty | Modeled non-royalty costs | Owner-operator benefit |
|---|---|---|---|---|
|
Conservative 25th-percentile revenue and files |
$98,448 | $49,224 | $23,673 | $25,551 |
|
Base Median revenue and files |
$129,547 | $64,773 | $26,052 | $38,722 |
|
Upside 75th-percentile revenue and files |
$209,259 | $104,630 | $31,701 | $72,929 |
What does the active-owner scenario range look like?
The modeled result rises from about $25,551 to $72,929 as the revenue and file-count anchors move from the cohort's lower quartile to upper quartile. These are pre-tax owner-operator benefit estimates for the 2025 one-location population, not FDD-reported profit.
Interpretation: the range is driven mainly by observed same-brand revenue dispersion. It is not a probability forecast, and the quartile anchors should not be read as guaranteed downside, expected, or maximum outcomes.
Sources: 2026 SCA Franchise Disclosure Document, Item 19, pp. 40-44; Item 6, pp. 4-7; derived quartiles and independent scenario calculations.
Which costs are included or excluded?
The model includes the official royalty and a transparent allowance for normal operating costs, but it does not treat owner labor as a payroll expense. This treatment applies to the active-owner, one-location 2025 scenario and is why the output is labeled owner-operator benefit rather than passive business profit.
- Royalty: 50% of Annual Gross Revenue in every primary scenario. The conditional 35% Elite Program rate is analyzed separately, not assumed.
- Vehicle: 15 business miles per completed file, multiplied by the 2025 IRS business mileage rate of $0.70 per mile. The 15-mile workload factor is an editorial assumption; the IRS rate is used only as a vehicle-cost proxy.
- Insurance: $3,200 annually, the midpoint of the FDD's $2,200-$4,200 annual premium range.
- Software: $6,000 annually for one user, equal to the Item 6 ceiling of $500 per month during the first 24 months. Actual required software pricing may be lower or higher after that period.
- Other operating allowance: $8,000 annually for phone, internet, licensing, accounting, supplies, and unlisted recurring expenses. This is an editorial scenario assumption, not an FDD figure.
- Excluded: personal income taxes, financing principal, financing interest, employer payroll burden, irregular capital expenditures, and a separate owner wage. Depreciation is not added separately because the mileage proxy incorporates vehicle-cost components.
How much does owner involvement change the result?
Officially, the FDD requires an Operating Principal to personally supervise the business and at least one full-time qualified Designated Appraiser to run day-to-day operations. The Operating Principal may serve as the Designated Appraiser. In the estimated manager-run comparison below, a paid appraiser replaces the owner's production labor for the same one-location 2025 scenarios. Source: 2026 SCA Franchise Disclosure Document, Item 15, pp. 26-28.
What remains after replacing the owner's appraisal labor?
Subtracting the BLS median employee wage of $74,520 produces a negative residual in all three standard-royalty scenarios. The comparison applies to the modeled one-location cohort and excludes employer payroll taxes and benefits, so the paid-appraiser result is optimistic.
Interpretation: at the observed one-location revenue anchors, owner labor is the central economic component. A delegated model may require substantially higher revenue, a lower labor cost, Elite Program savings, or multiple-location scale before it produces positive residual profit.
Labor benchmark: U.S. Bureau of Labor Statistics, Insurance Appraisers, Auto Damage, May 2023. BLS reports a $74,520 median employee wage and excludes self-employed workers.
The $26,000-$73,000 range is not pure passive profit. It combines residual business economics with compensation for the appraisals and operating work performed by the owner. Even using the BLS 25th-percentile employee wage of $63,690, the modeled upper-quartile standard-royalty case leaves only about $9,239 before payroll taxes, benefits, debt service, and personal taxes.
Which variables move annual earnings the most?
Estimated owner benefit is most sensitive to Annual Gross Revenue and the Continuing Royalty rate. At the $129,547 base revenue and 843-file workload, moving from the 50% standard royalty to a modeled full-year 35% rate adds $19,432 before any other change. The actual Elite Program is conditional, evaluated weekly, and may apply only to eligible assignments.
| Base-case sensitivity | Royalty | Miles per file | Estimated owner-operator benefit |
|---|---|---|---|
| Lower travel assumption | 50% | 10 | $41,672 |
| Primary base assumption | 50% | 15 | $38,722 |
| Higher travel assumption | 50% | 20 | $35,771 |
| Illustrative full-year Elite rate | 35% | 15 | $58,154 |
A 10-mile-per-file travel swing changes the base result by about $5,901 from low to high. The 15-percentage-point difference between the standard and Elite royalty changes it by $19,432 under the all-revenue illustration. Buyers should verify actual weekly qualification rates, the assignments treated as eligible, and the duration of reimbursements rather than underwriting the 35% rate as automatic.
What does the evidence still not resolve?
The largest unresolved uncertainty is the actual expense structure of comparable franchisees. Item 19 does not disclose labor, vehicle, insurance, software, subcontractor, bad-debt, administrative, or other operating costs, and it does not separate owner compensation from business profit. The uncertainty applies to every 2025 location and is greatest when comparing active owners with delegated or multi-location operators.
- Annual Gross Revenue
- The FDD's cash and other consideration received for services. It includes revenue before royalty and operating expenses.
- Estimated owner-operator benefit
- Modeled cash available after identified operating costs, before personal taxes and financing, with owner labor embedded.
- Manager-run residual
- Owner-operator benefit less a paid appraiser wage benchmark. It is not after-tax income and excludes employer payroll burden.
- Multi-location revenue
- Portfolio-level revenue for a reporting record with more than one listed location; it must not be treated as per-location performance.
Item 20 shows franchised outlets declining from 88 at the start of 2025 to 82 at year-end. That movement does not prove why outlets left and should not be used as a profit measure, but it increases the importance of interviewing current and former franchisees. Source: 2026 SCA Franchise Disclosure Document, Item 20, pp. 45-49.
What should a buyer verify before relying on any income estimate?
A buyer should replace the scenario assumptions with written, territory-relevant evidence. The following checks apply to the current U.S. offer, the 2025 Measurement Period, and the one-location active-owner model.
- Request the written Item 19 substantiation and confirm whether each table row maps to one franchisee, one entity, or a portfolio of service areas.
- Obtain recent profit-and-loss statements from several full-year, one-location franchisees with similar geography and file volume.
- Separate the 50% Continuing Royalty, software, insurance, vehicle mileage, licenses, accounting, subcontractor payments, employee wages, and payroll burden.
- Verify how often comparable owners qualify for the Elite Program, which assignments are eligible, and how reimbursement timing affects cash flow.
- Compare an owner-as-Designated-Appraiser model with a paid Designated Appraiser model; do not call the first figure passive profit.
- Interview current and former franchisees listed under Item 20 and the FDD exhibits, including operators below and above the median revenue level.
- Model financing interest and principal separately. Do not subtract the Item 7 startup investment from one year of revenue or treat personal taxes as a fixed business expense.
What is the strongest defensible annual earnings view?
The strongest defensible range is approximately $26,000 to $73,000 per year of estimated pre-tax owner-operator benefit, with a base scenario near $39,000. It is scenario-based, not an official Item 19 earnings result, and it applies to a full-year, one-location business under the standard 50% royalty where the owner performs the Designated Appraiser work.
The most important earnings drivers are Annual Gross Revenue and actual Elite Program qualification. The largest unresolved uncertainty is the non-royalty cost structure, especially vehicle workload and paid labor. A buyer should verify the Item 19 substantiation, obtain comparable franchisee financial statements, and test both owner-operated and delegated staffing models before treating any range as decision-grade.
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