Direct earnings answer
That is a defensible manager-run, pre-tax owner-earnings scenario for a mature Touching Hearts at Home Business using the middle half of the 2025 Gross Revenues distribution. The base scenario is approximately $98,800 per year. These figures are not profit or owner-income figures reported by Touching Hearts, Inc.; Item 19 reports revenue, not earnings.
- Legal franchisor
- Touching Hearts, Inc., a Minnesota corporation
- Current disclosure
- 2026 Touching Hearts Franchise Disclosure Document, issued April 30, 2026
- Item 19 status
- Official 2025 Gross Revenues and same-store sales growth; no business profit, EBITDA, Net Income, owner compensation or cash-flow disclosure
- Applicable cohort
- 66 franchised Businesses open for a full year as of December 31, 2025; three newer Businesses were excluded
- Estimate method
- FDD quartile and system median Gross Revenues multiplied by a 9.7% home-care agency median profit-margin proxy, sensitized by minus or plus 3 percentage points
- Owner-role benchmark
- May 2023 BLS annual mean wage of $100,050 for General and Operations Managers in NAICS 624120
- Date checked
- July 22, 2026
Scenario
$98,800
Base manager-run earnings
Pre-tax estimate before financing principal and personal income taxes.
Official
$1,018,557
Median Gross Revenues
2025 Item 19 median across 66 mature franchised Businesses.
Official
66
Reporting Businesses
All franchised Businesses open for at least one full year.
Benchmark
9.7%
Home-care median margin
Activated Insights reported this 2023 industry median.
Official
6%
Service Fee
Applied to Gross Revenues after the limited Start-Up Phase reduction.
Benchmark
$100,050
General Manager labor value
BLS annual mean wage for the closest industry and occupation match.
Item 19 evidence
What does the Touching Hearts Item 19 actually report?
It reports 2025 Gross Revenues, not owner earnings. The official average was $1,213,802 and the official median was $1,018,557 for 66 franchised Businesses that had operated for at least a full year. The overall range was $113,095 to $5,366,988. Only 22 Businesses, or 33%, were above the average, which shows why the median is the cleaner central sales anchor.
The FDD defines Gross Revenues broadly as billings for approved services and related activity, whether or not the customer has paid. It excludes applicable sales taxes and approved refunds, rebates or discounts. Consequently, Gross Revenues is not cash collected, Gross Profit, Operating Profit, Net Income or owner compensation.
| 2025 Item 19 cohort | Businesses | Median Gross Revenues | Reported range |
|---|---|---|---|
| Top 25% | 16 | $2,300,240 | $1,746,584–$5,366,988 |
| Upper-middle 25% | 17 | $1,142,620 | $1,019,513–$1,746,584 |
| Lower-middle 25% | 17 | $945,943 | $545,677–$1,017,602 |
| Bottom 25% | 16 | $273,861 | $113,095–$502,219 |
Official source: 2026 Touching Hearts FDD, Item 19, pp. 24–26. The franchisor states that the data were not audited or independently verified and may not have been prepared consistently with generally accepted accounting principles.
Item 20 provides useful population context. The system had no company-owned outlets in 2023, 2024 or 2025. Franchised Businesses increased from 65 to 69 during 2025, with four openings and no reported cessations that year. Because the system has no company-operated cohort, there is no same-brand company-store profit proxy available. See the official Touching Hearts U.S. franchise information for the current public description of the opportunity, while treating the delivered FDD as the controlling diligence document.
Scenario model
How is the $63,000–$145,000 earnings range calculated?
The range is an independent manager-run estimate. It uses the lower-middle quartile median, overall median and upper-middle quartile median from the 2025 FDD as three revenue anchors. It then applies a 6.7%, 9.7% and 12.7% all-in profit-margin sensitivity. The 9.7% center comes from an Activated Insights home-care margin benchmark; the low and high margins are explicit analytical assumptions of three percentage points below and above that benchmark.
| Scenario | Revenue anchor | Margin assumption | Manager-run owner earnings |
|---|---|---|---|
| Conservative | $945,943 | 6.7% | $63,400 |
| Base | $1,018,557 | 9.7% | $98,800 |
| Upside | $1,142,620 | 12.7% | $145,100 |
Pre-tax estimates before financing principal and personal income taxes
Interpretation: The base estimate is not presented as the most likely outcome. It is simply the FDD system median revenue multiplied by the published industry median margin.
Sources and method: 2026 Touching Hearts FDD, Item 19, pp. 24–26; Activated Insights, 2023 home-care agency median profit margin. Calculations use full-precision inputs and are rounded to the nearest $100.
- Manager compensation is treated as an operating expense. Residual profit is the manager-run owner-earnings estimate.
- Debt principal and personal income taxes are excluded. They depend on each buyer’s capital structure, entity and tax situation.
- Major capital expenditures are excluded from annual owner earnings. Routine operating expenses are presumed to be reflected in the all-in margin proxy.
- Interest and depreciation treatment is uncertain. The free benchmark summary does not publish a complete accounting definition, so the model should not be read as EBITDA, Net Income or cash flow.
Recurring obligations
How much do the disclosed fees absorb at the median sales level?
At the $1,018,557 Item 19 median, the known recurring franchise and required local-marketing burden is at least about $85,325 a year. This includes the 6% Service Fee, the required 2% local marketing spend, the current $200 monthly Technology Fee and only the $120 monthly minimum for WellSky. Actual WellSky expense can be higher because the charge is the greater of $10 per active client per month or $120 per month.
| 2026 FDD obligation | Stated basis | Annual amount at median sales |
|---|---|---|
| Service Fee | 6% of Gross Revenues | $61,113 |
| Local Marketing Spend | Greater of $300 monthly or 2% of prior-month Gross Revenues | $20,371 |
| Technology Fee | Current fee of $200 monthly | $2,400 |
| WellSky minimum | Greater of $10 per active client monthly or $120 monthly | $1,440 minimum |
| Known total | Excludes variable WellSky above minimum and contingent fees | $85,325 minimum |
Official source: 2026 Touching Hearts FDD, Item 6, pp. 6–8, and Item 11, pp. 13–16. The Marketing Fund Fee is currently not collected but may be implemented at up to 2% of Gross Revenues. An advertising cooperative is also currently not collected.
Owner role
How does active owner involvement change the economics?
An owner who personally serves as the required full-time General Manager could have an estimated owner-operator benefit of about $163,000–$245,000. This is not pure business profit. It combines the manager-run residual profit with the market value of management labor performed by the owner.
The 2026 FDD requires an approved General Manager to devote full time and attention to day-to-day operations. The General Manager may be a Principal Owner or a non-owner employee. For a labor-value benchmark, the BLS May 2023 wage estimates for NAICS 624120 report an annual mean wage of $100,050 for General and Operations Managers. The U.S. Census Bureau NAICS 624120 definition covers services for older adults and people with disabilities, including non-medical home care and homemaker services, making it a reasonable—though not exact—industry match.
The owner-operator calculation assumes the 9.7% margin proxy already reflects normal paid management expense. If the underlying survey treats owner compensation differently, adding the full BLS wage could overstate owner-operator benefit. That accounting-definition gap is not resolvable from the public benchmark summary.
The difference is the $100,050 annual General Manager labor benchmark
Interpretation: Active ownership can raise total economic benefit because the owner replaces a paid management role, but the added amount compensates full-time work. It should not be treated as passive income or a distribution available without labor.
Sources and method: 2026 Touching Hearts FDD, Item 15, p. 20; U.S. Bureau of Labor Statistics, May 2023, General and Operations Managers in NAICS 624120. Wage plus scenario residual, rounded to the nearest $100.
Uncertainty
How wide could actual owner earnings be?
Actual results could fall well outside the central $63,000–$145,000 range. The FDD’s bottom-quartile median Gross Revenues were $273,861, while the top-quartile median was $2,300,240. Applying the same 6.7% to 12.7% sensitivity mechanically produces roughly $18,300 to $292,100, but that broader span is a stress test—not a forecast—because the expense structure may change materially at different revenue levels.
The largest unknown is the exact conversion of Touching Hearts Gross Revenues into operating profit after caregiver payroll, payroll taxes, workers’ compensation, recruiting, scheduling staff, office payroll, insurance, occupancy, bad debt, local marketing, software and franchise charges. The public margin benchmark is useful but not same-brand evidence. Activated Insights describes the 2023 median margin as 9.7%; its later 2025 HCAOA benchmarking sample reports 1,149 industry providers representing 3,776 locations, demonstrating broad industry coverage but not proving compatibility with this specific franchise cohort.
A second cross-check points to caution rather than precision. The IRS Corporation Income Tax Returns Complete Report provides aggregate industry financials; a broad 2022 “miscellaneous health care and social assistance” calculation yields net income less deficit equal to about 4.6% of total receipts. That category is too broad and its tax-accounting definitions differ from the home-care benchmark, so it is not averaged into the scenario. It simply shows that a lower all-in margin is plausible.
What variables move earnings most?
Caregiver labor economics and billable hours are the dominant operating drivers. A small change in the spread between client billing rates and fully burdened caregiver cost can move profit more than a fixed monthly fee. Client retention, caregiver retention, overtime, unfilled shifts, payor mix, collection timing and office productivity all affect that spread.
Sales maturity also matters. The FDD warns that many Item 19 Businesses had operated for more than five years and are likely to report substantially higher revenue than a first-year franchisee. The 2025 same-store sales increase was 15%, but only 27 of 66 Businesses, or 41%, attained or exceeded that average. Average growth should not be treated as a guaranteed annual escalation rate.
Buyer verification
What should a prospective buyer verify before relying on this range?
Verify the actual expense bridge, not just the Item 19 sales number. The Federal Trade Commission’s franchise buyer guidance recommends scrutinizing earnings claims and speaking with current and former franchisees. The Touching Hearts FDD states that written substantiation for its Item 19 financial performance representation is available upon reasonable request.
- Request Item 19 substantiation and reconcile Gross Revenues to cash collections, caregiver payroll, payroll burden and Gross Profit for comparable mature Businesses.
- Ask several franchisees for manager salary, office staffing, recruitment cost, overtime, workers’ compensation, insurance, bad debt and local marketing as percentages of Gross Revenues.
- Separate owners who serve as full-time General Manager from owners who employ a non-owner General Manager; ask how many hours each owner works.
- Compare first-year, third-year and five-year-plus Businesses rather than applying the mature 2025 median to a startup ramp.
- Confirm the current Service Fee, Technology Fee, WellSky charge, Marketing Fund status and any advertising cooperative before signing.
- Model the buyer’s actual debt service separately, then discuss entity structure and personal tax consequences with qualified advisers.
Decision synthesis
What is the most defensible earnings takeaway?
A mature, manager-run Touching Hearts at Home Business may reasonably model approximately $63,000–$145,000 in annual pre-tax owner earnings, with a base calculation near $98,800. This is a scenario-based estimate anchored to official 2025 Gross Revenues, not an official Item 19 profit result.
The most important earnings driver is the margin between client billings and the fully burdened cost of caregivers and office operations. The largest unresolved uncertainty is the same-brand expense structure, including manager compensation and how recurring franchise obligations interact with local labor and pricing.
A buyer should verify Item 19 substantiation, obtain a revenue-to-profit bridge from comparable franchisees, distinguish owner-operated from manager-run results, and test financing separately. The owner-operator benefit may reach roughly $163,000–$245,000 in these scenarios, but about $100,050 of that amount represents the market value of full-time General Manager labor rather than passive business profit.
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