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Tru Franchise ProfileRestaurant Franchises > Full-Service Restaurants |
What is the Initial Investment for a Tru Franchise?
To open a Tru franchise, you'll need to consider a significant initial investment ranging from $12,763,888 to $18,595,223. This includes a franchise fee of $100,000. Additionally, ensure you have cash reserves between $2,000,000 and $3,000,000 to cover startup costs and initial operating expenses. Understanding these financial requirements is crucial for aspiring franchisees to assess their readiness for ownership.
What Are the Ongoing Fees Associated with a Tru Franchise?
Owning a Tru franchise involves ongoing fees that are essential to maintaining brand standards and supporting marketing efforts. Franchisees are required to pay a royalty fee of 5% on gross sales, along with a marketing fee of 4%. These fees contribute to the overall operational success of your franchise and help in building brand recognition in your market. It's important to factor these ongoing costs into your financial planning.
What Are the Revenue Expectations for a Tru Franchise?
Tru franchisees can expect varying revenue levels based on unit performance. The average annual revenue per unit is approximately $1,376,897, with a median of $1,016,156. The lowest reported annual revenue is $600,000, while the highest can reach up to $1,331,169. Understanding these figures can help franchisees set realistic financial goals and assess the profitability of their investment.
How Long Does It Take to Break Even with a Tru Franchise?
The breakeven time for a Tru franchise is estimated at 24 months, with an investment payback period of around 36 months. This timeline is vital for potential franchisees to consider when evaluating the financial viability of their investment. Planning for these timelines can help ensure that you have adequate funding and resources to support your franchise during the initial growth phase.
Tru 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:
Tru Franchise Unit Growth Summary
A breakdown of corporate, franchised, and total units, with yearly net changes.
Total Units
Franchised Units
Corporate Units
| Units | 2021 | 2022 | 2023 |
|---|---|---|---|
| Total Units | 177 | 212 | 231 |
| Net Change YoY | 35 | 19 | |
| Franchised Units | 177 | 212 | 231 |
| Net Change YoY | 35 | 19 | |
| Corporate Units | 0 | 0 | 0 |
| Net Change YoY | 0 | 0 |
Investment Overview
The Tru franchise offers a compelling investment opportunity with an initial investment range between $12,763,888 and $18,595,223. The franchise fee is set at $100,000, with ongoing royalty fees of 5% and a marketing fee of 4%. Prospective franchisees should have a cash reserve of $2,000,000 to $3,000,000 and a net worth of at least $6,165,500 to qualify for ownership.
Revenue Potential
Franchisees can expect strong revenue generation, with average annual revenue per unit reported at $1,331,169 and a median of $1,016,156. The revenue range varies significantly, with the lowest unit generating $600,000 and the highest reaching $1,331,169. This revenue potential underscores the profitability of the Tru franchise model.
Breakeven and Payback
The Tru franchise has a breakeven period of approximately 24 months, allowing franchisees to recoup their initial investment relatively quickly. The investment payback period is around 36 months, providing a clear timeline for financial recovery and subsequent profitability.
Franchise Growth
The Tru franchise is experiencing steady growth, with the number of franchised units increasing from 177 in 2021 to 231 in 2023. This upward trend reflects the brand's expanding market presence and the confidence franchisees have in the business model.
Operational Expenses
Average annual operating expenses for a Tru franchise unit are estimated at $861,000. This figure includes various costs associated with running the business, ensuring franchisees can plan their financial strategies effectively while maintaining operational efficiency.
Financial Performance
The financial performance of Tru franchise units is robust, with an EBITDA of $1,371,192, which constitutes 99.58% of revenue. This high EBITDA percentage indicates strong profitability and efficient management of expenses, making the Tru franchise an attractive option for potential investors.
Frequently Asked Questions
The initial investment for a Tru franchise ranges from $12,763,888 to $18,595,223, which includes the franchise fee and other startup costs.