INDUSTRY BENCHMARK · 42 SYSTEMS · FISCAL 2019–2025
Are home services franchises a good investment?
Across 42 home services franchise systems (4,138 franchised units), franchisees exited at an annualized rate of 9.2% in their latest FDD Item 20 filings, while new outlets opened at 22.5%. The median buy-in: a $55K franchise fee, 6.0% royalty, and a total investment of $118K–$207K.
People search for a “home services franchise failure rate,” but no such official number exists. What franchisors must disclose — in the Item 20 outlet tables of the FDD — is how many franchised outlets were terminated, not renewed, or “ceased operations — other reasons” each year. That annualized exit rate is the honest, measurable proxy: it slightly overstates failure (some exits are retirements or sales) and slightly understates distress (struggling units often sell before they close), but unlike survey numbers it comes from legally mandated disclosures.
9.2%
337 exits / 3,680 units at start
22.5%
828 outlets opened
42
verified FDD extractions
4,138
at latest fiscal year end
$55K
FDD Item 5
6.0%
FDD Item 6
$118K–$207K
FDD Item 7
32/42
systems disclosing an FPR
SOURCE: FDD ITEM 20 OUTLET TABLES FILED WITH STATE REGULATORS (MINNESOTA CARDS) · 42 SYSTEMS · 42 FILINGS · FISCAL 2019–2025
| Signal | Brand | Index | Grade |
|---|---|---|---|
| STRONGEST | COOL VU GLASS AND SURFACE SOLUTIONS | Proven & strong | |
| STRONGEST | Five Star Bath Solutions | Proven & strong | |
| STRONGEST | MIGHTY DOG ROOFING | Proven & strong | |
| WEAKEST | Kitchen Refresh | Too new to judge | |
| WEAKEST | Dryer Vent Superheroes | Too new to judge | |
| WEAKEST | ProLift Garage Doors | Too new to judge |
HEALTH INDEX: SOURCED 0–100 SCORE FROM EACH BRAND'S OWN FDD ITEM 20 · METHODOLOGY
Home Services franchise questions, answered from the filings
What percentage of home services franchises fail?
There is no official failure rate, but FDD Item 20 filings show the honest proxy: across 42 home services franchise systems, 337 franchised outlets left their systems (terminations, non-renewals, and "ceased operations — other") out of 3,680 open at the start of the year — an annualized exit rate of 9.2% in fiscal 2019–2025. Not every exit is a failure (some are retirements or sales), but it is the measurable floor.
How much does a home services franchise cost?
Across the latest FDD filings of 42 home services systems, the median initial franchise fee is $55K (Item 5) and the median total investment range is $118K–$207K (Item 7).
What royalty do home services franchises charge?
The median ongoing royalty across 42 home services franchise systems is 6.0% of gross sales, per Item 6 of their latest FDD filings.
Are home services franchises growing or shrinking?
In the latest Item 20 filings, home services systems opened new franchised outlets at an annualized rate of 22.5% while franchisees exited at 9.2%. Openings currently outpace exits in this industry.
What is the healthiest home services franchise?
By the Watch Desk verdict system (computed from FDD Item 20 with an evidence gate), the strongest verified home services system tracked is COOL VU GLASS AND SURFACE SOLUTIONS.
A broker is paid by the franchisor to place you. An independent CPA is paid by you — and the job is pressure-testing the numbers, including talking you out of a bad deal.
Talk to an independent CPA before you buy →