How to compare franchise costs in Canada

Lists of the best franchises to own or buy rank brands by someone’s judgment. This page does not. It shows how to compare what franchisors publish about cost, using eight brands outside food service that have their own pages on Deavo and publish at least one Canadian cost figure: Anytime Fitness, Drama Kids, H&R Block, Kumon, Mr. Lube, Pet Valu, ServiceMaster and The UPS Store. They are listed alphabetically. Each figure is quoted as the franchisor published it, with the date its page was read, and none is offered as a sign that one franchise is a better buy than another. Pizza and other food brands are covered in food franchise opportunities in Canada.

Start with the franchise fee, then look past it

The initial fee is one cost among several. H&R Block’s franchise page says you can operate a franchise for as little as a $2,500 non-refundable franchise fee, and adds that the expenses of furnishing and running an office are up to you. Kumon lists its fee as $2,000 less a $1,000 deposit fee for a first centre, against a total investment of $59,415 to $155,815. Drama Kids lists $30,000 plus working capital and GST. The UPS Store Canada does not state its fee separately: its total initial investment includes the franchise fee for a 10-year franchise agreement. A low fee and a low total are different things, so read both.

Read what the total investment includes

Two totals can cover different things. The UPS Store Canada gives a traditional location range of $219,500 to $299,500, says it includes centre design, build-out and construction, and asks you to plan for at least $50,000 in working capital on top for your first year. Pet Valu’s franchise site prices a new store at $613,000 to $874,000, including furniture, fixtures, leasehold improvements, equipment, the opening inventory order and the initial franchise fee, and says the range does not include applicable taxes. Mr. Lube puts the cost of opening a flagship store at approximately $1,800,000 to $2,200,000 and says conversions of existing automotive stores or a landlord building the shell may reduce costs. Anytime Fitness says initial investment for a new club starts from approximately $500k, naming no currency. ServiceMaster’s estimated initial investment, $252,675 to $358,810, is for ServiceMaster Restore only and may vary according to territory purchased.

Royalties and advertising: check the base

A percentage means little until you know which sales it is charged on. The UPS Store Canada says that, as indicated in its current franchise disclosure document, it collects 7 percent of franchise owners’ Sales Subject To Royalty, plus a 3% advertising fee. Pet Valu’s annual information form says that in fiscal 2025 almost all Pet Valu, Paulmac’s Pets and Bosley’s by Pet Valu franchisees paid a royalty equal to 6% of non-grooming gross sales and 1% of grooming services sales per store, subject to limited relief programs. H&R Block says you won’t pay any additional costs for national advertising. The other five pages read publish no royalty, so ask for every recurring fee in writing.

Capital the franchisor asks you to have

Some franchisors publish an entry test of their own. The UPS Store Canada requires at least $150,000 in liquid assets and a minimum 50% cash investment, marks the liquid assets figure as subject to change, and says meeting the liquid assets minimum does not guarantee approval. Mr. Lube states a cash equity requirement of approximately $600,000 to $800,000. ServiceMaster Restore lists liquid capital of $150,000 to $200,000 and a net worth of $300,000. These tests are the franchisor’s; ask a lender separately what it would need from you.

Where the binding figures are

Several of these franchisors point to their own disclosure documents. Kumon says it offers franchises solely by means of its Franchise Disclosure Document, and The UPS Store Canada says its figures are subject to change and directs readers to its disclosure document for current amounts. Alberta’s Franchises Act requires a franchisor to give every prospective franchisee a copy of its disclosure document at least 14 days before the earlier of signing any agreement relating to the franchise or paying any consideration relating to it (a fully refundable deposit aside), subject to the Act’s exemptions, and Ontario’s Arthur Wishart Act sets a similar requirement. Ontario’s Act defines a material fact to include any information about the business, operations, capital or control of the franchisor or its associate, or about the franchise system, that would reasonably be expected to have a significant effect on the value or price of the franchise or the decision to acquire it. The Canadian Franchise Association lists seven provinces with franchise disclosure legislation; elsewhere, ask your lawyer which rules apply.

Low-cost and best-of labels

A franchise called low-cost, or placed on a list of the best franchises to buy, has been labelled by whoever made the list. The label is not a figure. Compare the published minimum, what it leaves out, the capital the franchisor requires and the recurring fees, then test each against the disclosure document and against what current franchisees tell you about their own costs. For pizza brands, the same comparison is set out in pizza franchises for sale in Canada.