Hello Garage Franchise Costs, Fees & Owner Salary (2023)

INVESTMENT

$132,000

-

$161,000

OPERATING PROFIT

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Adam

Updated

February 27, 2024

Is

Hello Garage

a franchise?

Yes,
Hello Garage
is a franchise and
currently
accepts
franchise
applications

Hello Garage, a franchise focused on garage renovation, offers an opportunity to dive into a market with significant potential. Founded in 2019 and starting franchising in 2020, the franchise has expanded rapidly and is part of a booming $2.2 billion industry that's growing annually​​. Hello Garage is headquartered in Omaha, Nebraska.

Hello Garage stands out by offering a simple, home-based business model that requires few employees and no lease or build-out, allowing for quick opening times. The franchise provides comprehensive support, including a national appointment center that closes 69% of leads at no additional fee to the franchisee. Training is extensive, with a mix of virtual sessions, in-person training, and ongoing support to ensure franchisees are well-equipped to succeed​​.

Ideal candidates for Hello Garage are those with a passion for serving people, business/managerial acumen, superior people skills, and a motivation to build a scalable business. The franchise seeks individuals who are comfortable following a proven process and are dedicated to achieving strong economic results​​.

How many

Hello Garage

franchises

are there?

In 2022, there were
151
outlets in the United States, of which
141
are franchises, and
10
are corporate-owned.

What are the

Hello Garage

franchise

fees?

Initial franchise fee

$49,500

Royalty fee

6.0%

Advertising fee

2.0%

Initial Franchise Fee

You will pay an initial franchise fee equal to the amount described on Exhibit A. This fee is payable when you sign the Agreement, is fully earned upon receipt, and is non-refundable.The initial Franchise Fee for a single Protected Territory is $49,500.

Technology On-Boarding Fee

You will pay $175 to process your technology onboarding. This fee is payable 90 days after you sign the Agreement, is fully earned upon receipt, and is non-refundable.

Royalty Fee

You must pay a non-refundable weekly royalty fee equal to 6% of Gross Revenue, due via electronic transfer each Wednesday. Each year, you must pay a minimum Royalty Fee equal to 6% of the Minimum Performance Requirement Per Protected Territory.

Transfer Fee

You will pay a $10,000 fee before the completion of any transfer of the Franchise Agreement, assets, or interest in your franchise.

Renewal Fee

You will pay a fee equal to 20% of the current initial franchise fee for the first protected territory at least 30 days before the renewal of the Franchise Agreement.

Minimum Local Advertising Spend Requirement

The Hello Garage franchise advertising fees are:

  • Brand Fee: Greater of $150/week or 2% of Gross Revenue/month.
  • Local Advertising: Minimum of 10% of Gross Revenue or $60,000/year for one territory; for multiple territories, 10% of Gross Revenue or $35,000 per territory/year.

How much does

it cost

to start a

Hello Garage

franchise?

It costs between
$132,000
and
$161,000
to start a
Hello Garage
franchise.
Type Of Expenditure Amount
Initial Franchise Fee $49,500
Technology On-Boarding Fee and Software License Fees $844
Minimum Opening Marketing Spend $20,000 - $30,000
Launch Kit $1,300
Vehicle Financing & Vehicle Wrap $3,000 - $7,000
Opening Inventory Purchase and Initial Equipment Package $46,024 - $50,754
Business Licenses and Permits $140 - $250
Computer System $0 - $4,000
Travel Expenses to Attend Initial Training In-Person $2,000 - $3,000
Insurance $700 - $1,500
Trade Show Booth $1,300 - $2,000
Franchise Resource Bookkeeping Fee $750 per franchisee
Additional Funds - 3 Months $6,000 - $10,000
Total $131,558 - $160,898

Note: The table above provides a snapshot of the main costs associated with starting the most common franchise format (as disclosed in the Item 7 of the Franchise Disclosure Document). For a complete overview of all the expenses involved with the various formats offered by the franchisor, please consult the Franchise Disclosure Document.

Does

Hello Garage

provide

training

to its

franchisees?

Yes,
Hello Garage
provides training to its franchisees.

Training

The franchisor provides a comprehensive initial training program that takes place in multiple phases:

  1. Phase One: Occurs at least two weeks before the opening of the Franchised Business, spanning 3 to 5 days. This phase includes virtual training before and after the first phase, required for the Designated Owner, Operating Manager, approved managers, employees, and sales employees.
  2. Phase Two: Conducted during the first year of the Franchised Business's operation over 2 to 4 days as determined by the franchisor. This training includes instruction on Franchised Business operations, services offered, compliance with state and federal laws, leadership, customer service, and marketing and sales programs.

Additionally, the franchisor may adjust the amount of training based on factors like the Designated Owner's and Operating Manager's previous experience. There's also opening assistance provided by the franchisor's employee to help in the initial stages of the Franchised Business, with no training fee charged for this support. However, subsequent on-site assistance may incur a fee.

Required Ongoing Training: The franchisor may mandate further training for the Designated Owner, Operating Manager, and designated employees, covering additional aspects necessary for the operation of the Franchised Business. This might include compensation, travel, lodging, and living expenses for attending these training sessions.

Does

Hello Garage

provides

territory

protection?

The franchisor offers territory protection to franchisees. When you sign the Franchise Agreement, you will receive one or more contiguous Protected Territories. Each Protected Territory is determined by various factors, including a commute of approximately an hour throughout the territory, and will include up to approximately 75,000 qualified single-family households.

During the term of the Franchise Agreement and provided you comply with the Franchise Agreement, the franchisor will not place, or grant a third party the right to place, another Hello Garage business inside your Protected Territory, except as described in specific conditions.

This means you will not receive an exclusive territory, but you may face competition from other franchisees, from outlets that the franchisor owns, or from other channels of distribution or competitive brands that the franchisor controls.

Can a

Hello Garage

franchise

be run as

a passive

investment?

The franchisor requires franchisees, particularly the Operating Manager, to assume responsibilities on a full-time basis and not engage in any other business or activity that may conflict with their obligations to the franchise. This indicates a significant level of involvement in the day-to-day operations of the franchise​​.

Additionally, the franchisee, if an individual, or a designated Principal Owner in case the franchisee is an entity, must oversee the Franchised Business operations and is required to have satisfactorily completed the franchisor's initial training program.

Even if the Designated Owner and Operating Manager are not the same person, the Designated Owner still must oversee the Franchised Business but is not required to be involved in the day-to-day operation​​.

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