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Estrella Insurance Franchise ProfileAccounting & Financial Franchises > Financial Planning |
What is the Initial Investment for an Estrella Insurance Franchise?
To open an Estrella Insurance franchise, the initial investment ranges from $12,250 to $84,000. This includes a franchise fee of $25,000, which grants you the rights to operate under the Estrella Insurance brand. Additionally, potential franchisees should have cash reserves between $49,950 and $84,000 and a net worth of $100,000 to $250,000 to ensure financial stability during the startup phase.
What Are the Ongoing Fees Associated with an Estrella Insurance Franchise?
Franchisees of Estrella Insurance are required to pay a royalty fee of 6% on their gross revenue, in addition to a marketing fee of 7%. These ongoing fees contribute to the overall support and brand development provided by Estrella Insurance, helping franchisees to effectively market their services and maintain a competitive edge in the insurance industry.
What Are the Financial Performance Expectations for Estrella Insurance Franchisees?
Estrella Insurance franchisees can expect an average annual revenue of approximately $1,170,495 per unit. The financial metrics show a gross profit margin of 68.3%, indicating a strong potential for profitability. With the right management and operational strategies, franchisees can achieve an EBITDA of around $437,324, which reflects a healthy 37.4% of revenue.
How Quickly Can Franchisees Expect to Break Even?
One of the attractive aspects of an Estrella Insurance franchise is the relatively quick breakeven period, estimated at just 12 months. This means that with effective business practices and customer acquisition strategies, franchisees may recover their initial investment within the first year of operation, setting the stage for future profitability and growth in their franchise business.
Estrella Insurance Franchise Financial Requirements
Below, you’ll find an overview of the initial investment needed to launch the business, along with the ongoing fees required by the franchisor to maintain operations over time.
The minimum total assets (minus liabilities) you must possess.
Net Worth Required:
The estimated period to recoup your total investment.
Investment Payback:
The initial fee paid to join the franchise system.
Franchise Fee:
Ongoing percentage of revenue paid to the franchisor.
Royalty Fee:
Regular contribution toward the franchise’s advertising fund.
Marketing Fee:
The estimated timeframe to recover your initial costs.
Breakeven Time:
The total amount required to launch the franchise.
Initial Investment:
The minimum liquid capital you must have on hand.
Cash Required:
The typical yearly revenue generated per franchise location.
Average Revenue:
The middle value of yearly revenue among franchise locations.
Median Revenue:
The largest reported annual revenue among franchisees.
Highest Revenue:
The smallest reported annual revenue among franchisees.
Lowest Revenue:
A broad sector defining similar types of franchise businesses.
Industry:
A more specific division within the broader industry.
Category:
The key individuals guiding the franchise’s strategy and growth.
Leadership:
The official business address of the franchisor’s headquarters.
Corporate Address:
Available financing options to help start the franchise.
Funding Year:
The main organization that owns the franchise brand.
Parent Company:
Estrella Insurance Franchise Unit Growth Summary
A breakdown of corporate, franchised, and total units, with yearly net changes.
Total Units
Franchised Units
Corporate Units
| Units | 2017 | 2018 | 2019 |
|---|---|---|---|
| Total Units | 134 | 115 | 127 |
| Net Change YoY | -19 | 12 | |
| Franchised Units | 134 | 115 | 127 |
| Net Change YoY | -19 | 12 | |
| Corporate Units | 0 | 0 | 0 |
| Net Change YoY |
Investment Overview
Estrella Insurance offers a franchise opportunity with a low initial investment starting at $12,250 and a high of $84,000. The initial franchise fee is set at $25,000, with ongoing royalty fees of 6% and a marketing fee of 7%. To get started, franchisees should have liquid cash between $49,950 and $84,000 and a net worth of $100,000 to $250,000.
Revenue Potential
Franchisees can expect significant annual revenue, with an average per unit revenue of $3,355,863. The revenue ranges from a low of $443,171 to a high of $14,867,794, showcasing the potential for profitability in the Estrella Insurance model. This robust revenue stream highlights the brand's strong market presence and operational effectiveness.
Breakeven and Payback
Estrella Insurance franchises typically see a breakeven point within 12 months. This quick return on investment is appealing for aspiring entrepreneurs, as it indicates strong cash flow management and efficient operations. Franchisees can expect to recoup their initial investment within the same time frame, making it a potentially lucrative opportunity.
Franchise Growth
The Estrella Insurance franchise has shown steady growth in the number of franchised units over the years. In 2017, there were 134 franchised units, followed by 115 in 2018, and 127 in 2019. This consistent presence in the market reflects the brand's stability and the ongoing demand for its services.
Financial Performance
The average annual revenue for Estrella Insurance franchises is approximately $1,170,495, with a gross profit margin of 68.3%. Operating expenses account for around 30.9% of revenue, leading to an EBITDA of 37.4%. These figures indicate a healthy financial structure, allowing franchisees to maintain profitability while managing operational costs effectively.
Corporate Structure
Estrella Insurance operates as a franchise system without any company-owned units, focusing entirely on franchised locations. This model allows franchisees to own and operate their businesses independently while benefiting from the support and resources of the Estrella Insurance brand. The absence of corporate units reinforces the commitment to franchisee success and growth.
Frequently Asked Questions
The initial investment for an Estrella Insurance franchise ranges from $12,250 to $84,000. This includes the franchise fee of $25,000 and other startup costs.