Guide

How much does a franchise really cost in Australia?

The advertised franchise fee is rarely the real number. Here is how to read the full cost of a franchise, and what each category actually runs.

PB

Prakash Bartaula

Founder & Lead Analyst · Founder, Toradigm Pty Ltd

Last updated 2 October 2026 · 8 min read.

How much does a franchise cost in Australia?

A franchise in Australia can cost anything from under $30,000 for some home-based services to more than $1 million for large food and childcare formats. In the Q3 2026 Fee Index, the median all-in cost is $27,000–$80,000 for cleaning, $51,000–$128,000 for home and trade services, $300,000–$700,000 for coffee and cafés, and $250,000–$500,000 for fitness. The all-in figure includes the initial fee, establishment/fit-out and working capital, not the franchise fee alone.

The four cost buckets

  1. Initial franchise fee, a one-off licence fee, commonly $25,000–$55,000.
  2. Establishment / fit-out, the physical build, equipment and vehicle; the biggest and most variable bucket.
  3. Ongoing fees, royalty and marketing levy, charged as a percentage of gross sales for the life of the agreement.
  4. Working capital, cash to cover wages, stock and rent before the site is cash-flow positive.

What the categories actually cost

Category medians from the Australian Franchise Fee Index (Q3 2026) give a reality check. Coffee and café franchises have a median all-in cost of $300,000–$700,000 across 29 systems, with a 6.0% median royalty. Cleaning costs far less to start, $27,000–$80,000 at the median, but too few cleaning systems publish their royalty for a median, so check it in each disclosure document. Fitness spans a wide range, driven by fit-out on large-format sites.

A higher royalty is not automatically bad. Some low-entry models carry higher royalties because the franchisor's support cost is spread over a smaller sale. Judge the fee against the category median, not in isolation.

Ongoing fees compound

Royalty and marketing levy are charged on gross sales, so they scale with revenue for the whole term. A 1% difference in royalty on a $600,000-turnover site is $6,000 a year, over a 7-year term, $42,000. Small percentage differences are large dollar differences over time.

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Frequently asked questions

What is the cheapest type of franchise to buy in Australia?

Mobile and home-based services are typically the cheapest, because they need little or no fit-out. In the Q3 2026 Fee Index the median all-in cost is $18,000–$49,000 for lawn and garden, $27,000–$80,000 for cleaning and $51,000–$128,000 for home and trade services. Check the royalty too: it can be high even when entry is cheap.

Why is the franchise fee lower than the total cost?

The initial franchise fee is only the licence to operate. The total cost adds establishment/fit-out and working capital, which together are usually far larger than the fee itself. Always ask for the all-in figure.

Are franchise royalties negotiable?

Rarely. Royalties and marketing levies are usually set uniformly across the network and disclosed in the disclosure document. What varies is the establishment cost, which depends on your site.

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