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ExtraMile Franchise ProfileRetail Franchises > Convenience Stores |
What are the Initial Investment Requirements for an ExtraMile Franchise?
To open an ExtraMile franchise, you should be prepared for a significant initial investment. The total estimated investment ranges from $182,575 to $4,109,100. This includes a franchise fee of $15,000. Additionally, you will need to demonstrate a net worth between $500,000 and $1,000,000, along with liquid cash requirements of $182,575 to $534,300 to cover startup costs and operational expenses.
What are the Financial Performance Metrics for ExtraMile Franchise Units?
ExtraMile franchise units have shown promising financial performance, with an average annual revenue of $72,917 per unit. The median annual revenue is slightly lower at $64,832, while the revenue range varies widely, from a low of $7,657 to a high of $525,017. Franchisees can expect to break even within approximately 12 months and achieve investment payback in about 24 months, making it a potentially lucrative opportunity for investors.
What Ongoing Fees Should ExtraMile Franchisees Expect?
As an ExtraMile franchisee, you will incur ongoing fees that include a royalty fee of 4.50% on gross sales and a marketing fee of 1.50%. These fees are essential for maintaining brand presence and supporting national marketing efforts, which can drive customer traffic to your location. Understanding these ongoing costs is crucial for effective financial planning and ensuring long-term profitability.
How Many Units Does ExtraMile Operate?
ExtraMile has demonstrated steady growth in its franchise network, operating a total of 878 units as of 2020. This includes 615 franchised units and 263 corporate-owned locations. The growth trajectory from 523 franchised units in 2018 to 615 in 2020 indicates a strong demand for the brand and a solid foundation for potential franchisees looking to join a growing network.
ExtraMile 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:
ExtraMile Franchise Unit Growth Summary
A breakdown of corporate, franchised, and total units, with yearly net changes.
Total Units
Franchised Units
Corporate Units
| Units | 2018 | 2019 | 2020 |
|---|---|---|---|
| Total Units | 782 | 832 | 878 |
| Net Change YoY | 50 | 46 | |
| Franchised Units | 523 | 570 | 615 |
| Net Change YoY | 47 | 45 | |
| Corporate Units | 259 | 262 | 263 |
| Net Change YoY | 3 | 1 |
Investment Overview
The ExtraMile franchise offers a range of initial investment options, with costs ranging from $182,575 to $4,109,100. The initial franchise fee is set at $15,000, making it accessible for aspiring franchisees. With a cash requirement between $182,575 and $534,300, potential owners can evaluate their financial readiness to embark on this business opportunity.
Financial Performance
The average annual revenue per unit for ExtraMile franchises is approximately $72,917, with a median revenue of $64,832. This indicates a solid earning potential for franchisees. However, revenues can vary significantly, with the lowest reported at $7,657 and the highest reaching $525,017, highlighting the importance of location and operational efficiency in driving sales.
Operating Costs
Operating expenses for ExtraMile franchises account for about 49.3% of total revenue, totaling approximately $35,982,387 annually. Key expense categories include employee wages and benefits, general administrative costs, and marketing fund expenses. Understanding these costs is crucial for franchisees to manage their financial performance effectively.
Royalty and Marketing Fees
Franchisees are required to pay a royalty fee of 4.50% of gross sales, along with a marketing fee of 1.50%. These fees contribute to the brand's overall marketing efforts and support systems, ensuring franchisees benefit from a strong brand presence and customer engagement initiatives.
Breakeven and Payback Period
ExtraMile franchises typically achieve breakeven within 12 months of operation, which is a favorable timeline for new business owners. The investment payback period is approximately 24 months, allowing franchisees to recoup their initial investments relatively quickly, provided they manage their operations effectively.
Growth and Expansion
The ExtraMile franchise has shown consistent growth, increasing from 523 franchised units in 2018 to 615 in 2020. This upward trend indicates a strong demand for the brand and a successful franchise model. Additionally, the presence of corporate units supports franchisees by providing operational insights and resources for ongoing success.
Frequently Asked Questions
The initial investment for an ExtraMile franchise ranges from $182,575 to $4,109,100, which includes the franchise fee and other startup costs.