Maaco Franchise Costs, Fees & Owner Salary (2023)

Initial Franchise Fee ($20,000)

‍The initial advertising contribution for a Maaco Center is $20,000, payable no later than 30 days before the Center is scheduled to open.

Maaco will use this contribution within one year after the actual opening of the Center for grand opening marketing, which may encompass traditional marketing, digital marketing, promotional and event materials, and other assets. The fee is utilized to purchase these marketing materials.

Royalty Fee (Varies between 4.8% and 8% of Gross Receipts)

‍The royalty fees paid by franchisees under the franchise agreement are calculated based on the cash a franchisee collects, as opposed to the sales invoices generated. Due to this, there may be differences in royalty fee rates among franchisees. Some franchisees have signed development agreements which provide for varying royalty incentives. Maaco Centers have paid royalty fees ranging between 4.8% and 8% of gross receipts.

Advertising Fee ($1,000 or based on weekly marketing budget)

‍Franchisees are obligated to pay a weekly marketing fee of $1,000 under the franchise agreement. However, some franchisees might pay higher weekly marketing fees based on the weekly marketing budget of the franchisees operating in their designated market area.

Here's an insight into the training and support they offer to their franchisees:

• Initial Training: Maaco offers an "Orientation/Training Program" which is conducted multiple times a year. This program is a blend of classroom instruction and hands-on experience, ensuring that franchisees are familiar with the operations of their service center. The training takes place in designated locations, including Charlotte, North Carolina, and may also be offered through online virtual classrooms. While Maaco provides the training, franchisees are responsible for their transportation, accommodation, food, and other personal expenses during this period.
• Field Training: To ensure that the knowledge gained in the classroom is effectively translated to real-world scenarios, Maaco offers "New Franchisee Orientation (Field Training)". This training is store-moderated and is divided into pre-classroom and post-classroom sessions. The pre-classroom segment is 40 hours long, and the post-classroom segment spans 160 hours.
• Optional Training: Recognizing the diverse needs of franchisees, Maaco offers optional training sessions. These sessions cover various aspects, including financial training and software training. The duration of these sessions can vary, with financial training currently set at 20 hours.
• Fast Track Training: For those franchisees or managers who come with prior experience, Maaco offers a "Fast Track" program. This program is tailored to cater to the needs of experienced individuals, ensuring they receive the specific training they require.

Franchisees of Maaco do not receive an exclusive territory under the Franchise Agreement. This means they might face competition from other franchisees, outlets owned by Maaco, or other distribution channels or competitive brands controlled by Maaco.

However, franchisees are allowed to operate the Center only at a location approved by Maaco. They are not restricted in terms of the area they can solicit business or the customers they may approach.

Furthermore, while the franchise is nonexclusive, Maaco has set certain conditions to protect franchisees. For instance, if Maaco wishes to license a third party to establish a Maaco Center in the same Core Based Statistical Area (CBSA) as an existing franchisee, they will not grant that license if it results in more than one Maaco Center for every 50,000 persons in that CBSA.

This offers a degree of protection against oversaturation in a given area. However, it's important to note that Maaco retains the right to develop and operate any business under any name in any area, regardless of its proximity to or effect on the Centers developed by the franchisee.

The Maaco franchise model requires franchisees to be actively involved in the management and operation of their center. Specifically, the franchisee (or if the franchisee is more than one person, the person approved by Maaco as the center's principal operator) must devote their full time, energy, and efforts to the direct management and supervision of the center.

The center must always be managed and operated by the franchisee or the designated principal operator. Additionally, both the franchisee (or their majority investor) and the individual conducting the day-to-day management and operation of the center as the principal operator must attend and complete Maaco's initial training program to the company's satisfaction.