About Mr. Appliance Franchise
Mr.
Appliance is a home services franchise specializing in the installation and repair of household and commercial appliances.
Part of the Neighborly family of brands under Neighborly Assetco LLC, the company has been franchising since 1996 and has established itself as a trusted name in appliance repair across the United States.
Mr. Appliance Franchise Cost & Fees
Minimum Investment
$79K
Average Investment
$118K
Maximum Investment
$158K
| Fee Type | Amount | Notes |
|---|---|---|
| Initial Franchise Fee | $53,125 | One-time payment upon signing |
| Royalty Fee | 5% - 7% of Gross Sales of gross sales | Ongoing; paid monthly |
| Marketing/Ad Fund | 2% of Gross Sales | National brand fund |
| Total Investment Range | $78,925 – $157,640 | Includes build-out, inventory, working capital |
The investment range of $79K–$158K reflects variability in build-out costs, store size, lease terms, and market. The combined royalty (5% - 7% of Gross Sales) and marketing fee (2% of Gross Sales) are ongoing costs paid as a percentage of gross sales.
Investment Breakdown (Item 7)
| Item | Low | High |
|---|---|---|
| Initial Franchise Fee | $53,125 | $53,125 |
| Vehicle | $2,250 | $29,220 |
| Equipment, Supplies & Inventory | $5,900 | $11,400 |
| Insurance | $1,000 | $2,000 |
| Advertising & Promotional and Local Marketing Spending for Marketing Start-up Phase. | $7,500 | $35,000 |
| Training, Travel, Lodging & Food | $3,000 | $5,500 |
| Deposits, Permits & Licenses | $0 | $1,000 |
| Professional Fees | $0 | $5,000 |
| Additional Funds – 3 Mo. | $6,000 | $12,000 |
| Technician Training | $150 | $395 |
| Real Estate | $0 | $3,000 |
Additional Fees (Item 6)
| Fee Type | Amount |
|---|---|
| Transfer Fee | The greater of (i) $7,500 or (ii) 5% of the sales price |
| Renewal Fee | $5,000 |
| Technology Fee | $245.00 for unlimited office access, plus $85 per mobile technician; Additional Microsoft Office365 Exchange email accounts are $4.00 per month, O365 E1 email accounts are $8.00 per month, and O365 E3 email accounts are $20.00 per month. |
| Audit Fee | Cost of audit plus expenses, plus any amount owed as shown by the audit, plus interest and late fees |
| Local Marketing Groups | Not to exceed 2% of Gross Sales |
| Late Fees (on Software System Monthly Fees) | $25 per month or the maximum amount allowed under the law, whichever is less |
| Call Center Services One-time Set Up Fee | $249.00 |
| Call Center Services Monthly Fees | Tier One: $0.98-$1.25/Minute |
| Annual Convention (“Reunion”) Fees | Currently $1,000 or less |
| Late Fees (Franchise Agreement) | $10 per day |
| Dishonored Check or ACH Draft | $25 |
| Interest | 12% on unpaid balances |
| Failure to Maintain Insurance | Our actual cost for insurance premiums and a reasonable fee for expenses we incur |
| Amendment Fee | $250 |
| Unapproved Suppliers | Our actual out-of-pocket costs of inspection or testing |
| Indemnification and attorneys’ fees and costs | Varies according to loss |
| Tax Reimbursement | Varies according to tax |
| Additional Training Fees | The then-current fee, currently up to $5,000 |
| Key Accounts/Management Fee | Up to 5% of total Gross Sales related to Key Account work |
Training Program (Item 11)
| Detail | Information |
|---|---|
| Total Duration | Phase I Training generally lasts five days, Phase II Training generally lasts 5 days. Phase III Training is comprised of tasks and learning related to setting up your Business. Field training is 8-40 hours. |
| Classroom Training | 72.2 hours |
| On-the-Job Training | 8-40 hours |
| Training Location | Phase I and II Training occurs at our offices in Waco, Texas or at such other locations as we may designate, or via webinar/video conferencing. Phase III Training occurs via telephone or webinar/video conferencing. Field training in an Operating Business occurs at various locations or virtually. |
| Additional Training | Franchisor may require franchisees and key employees to attend ongoing training, regional meetings, and annual conventions ('Reunion') at franchisee's expense. A fee may be charged for attending meetings/conventions, regardless of actual attendance. |
Territory Rights (Item 12)
| Detail | Information |
|---|---|
| Territory Type | Limited territorial protection |
| Exclusive Territory | Yes |
| Territory Size | Minimum population of 125,000 and a maximum population of generally no more than 2,500,000. |
| Description | Franchisee receives the right to operate a Mr. Appliance business at a location within a designated territory that provides limited territorial protection. The territory population generally ranges from 125,000 to 2,500,000, but larger populations may be allowed under certain circumstances. Franchisor reserves the right to sell or allow others to sell similar products/services outside the territory or through different channels, and may advertise, solicit, and enter into Key Accounts within the territory. Franchisor will not operate or grant another Mr. Appliance franchise with marketing rights within the franchisee's territory. |
Renewal, Termination & Transfer (Item 17)
| Detail | Information |
|---|---|
| Initial Term | 10 years |
| Renewal Term | 10-year term |
| Renewal Fee | $5,000 |
| Renewal Conditions | Franchisee must not be in default, have satisfied all monetary and material obligations, be in good standing, have received no more than 3 written default notices, give written notice, sign a general release, complete current training, and sign the then-current franchise agreement (which may have different terms, conditions, and fees). |
| Transfer Fee | The greater of (i) $7,500 or (ii) 5% of the sales price |
| Transfer Conditions | Franchisee must not be in default; have paid in full all amounts owed to franchisor, affiliates, or suppliers; provided all required reports; the new franchisee qualifies; training for new franchisee is arranged; franchisee, owners and guarantors sign release; transfer fee paid; current franchise agreement signed by new franchisee; new franchisee agrees to be bound by all customer obligations of Franchisee, including all warranty work and service plans obligations. |
| Termination for Cause | Franchisor can terminate if franchisee defaults on material provisions, with cure periods (10 days for payment/reports, 30 days for other defaults). Immediate termination without cure for material misrepresentation, voluntary abandonment (7+ consecutive days), business closure for safety, domain name registration with Marks, unauthorized use of confidential information, insolvency/bankruptcy, conviction of misdemeanor impairing Marks/goodwill or any felony, intentional understatement/underreporting of Gross Sales/fees, 2% or more understatement on audit within 2 years, unauthorized transfer, or second default of any type within 12 months. |
| Non-Compete Period | During the term of the Agreement and during any Interim Period (if applicable), and for a period of two years after expiration or termination of the Agreement or cessation of association with Franchisee. |
| Non-Compete Details | During the term and for two years after termination/expiration, franchisee (including owners, spouse, children, parents, siblings) cannot own, manage, operate, maintain, engage in, consult with or have any interest in any Competitive Business (defined as any business offering products/services that compose part of the System, are similar to those offered by franchisees, or otherwise competes directly or indirectly with the System) within the Territory, within a 25-mile radius of the outer boundary of the Territory, or inside the territory of another MR. APPLIANCE business. Also, for one year after termination, cannot divert or attempt to divert business/customers from the System. |
Operations & Supply (Items 8 & 15)
| Detail | Information |
|---|---|
| Owner-Operator Required | Yes |
| Participation Details | If the franchisee is an individual, they must directly perform or supervise the operation of the Business, or if consent is given, a manager who completed training must supervise. If the franchisee is a legal entity, a designated 'principal owner' who completed training must directly supervise, unless consent is given for a manager to supervise. Principal owners and guarantors must sign a personal guarantee. Franchisees cannot have an interest in competitors. Existing businesses can be excluded from the franchise if approved. |
| Required Suppliers | Franchisor or its designated supplier (currently ZorWare) for Software System. Intuit Limited for Quickbooks Online. Designated service provider for call center services. ProTradeNet for vehicle ordering to receive rebates. Franchisor-approved suppliers for advertising and promotional materials. |
| Supply Restrictions | Franchisee must use approved products, inventory, supplies, uniforms, tools, equipment, signs, telephone and internet equipment and service, advertising materials, and other items. Franchisor reserves the right to designate a primary or single source for certain products and supplies, and may be that single source. Franchisee may purchase from other suppliers if they follow approval procedures and obtain prior written approval, including testing at franchisee's expense. Franchisee cannot contract with an alternative supplier for products/services where franchisor has designated a supplier. |
| Franchisor Revenue from Suppliers | ProTradeNet's predecessor PTNLLC had revenue of $963,454 (about 11% of its total revenues of $8,792,535) from purchases by Mr. Appliance franchisees in 2020. ZorWare had revenue of $1,440,177 (about 23% of its total revenues of $6,262,426) from required purchases/payments by franchisees for initial training, maintenance, and monthly support in 2020. Predecessor had revenue of $428,355 (about 3.70% of its total revenues of $11,572,800) from purchases by Mr. Appliance franchisees from approved suppliers or under Predecessor’s specifications in 2020. Franchisor had no revenue from franchisee purchases in 2020. Franchisor or affiliates may receive a commission from brokerage of capital lease or other equipment finance. |
Financing (Item 10)
| Detail | Information |
|---|---|
| Financing Available | Yes |
| Description | Franchisor may finance a portion of the initial franchise fee, up to 70% (or 80% if certain requirements are met), based on credit-worthiness and collateral. Interest rates range from 9% to 12% based on credit score. Monthly payments begin approximately 2 months after Phase I Training. Repayment terms range from up to 5 years for loans less than $45,000 to 9 years for loans greater than $150,000. A security interest in the business assets is required. Franchisor may also refer to third-party lenders but does not guarantee obligations. |
Mr. Appliance Franchise Earnings — Item 19
Average Revenue
$214
Median Revenue
$207
Revenue Range
$112 – $421
Sample Size
287 units
Past financial performance does not guarantee future results. Individual results will vary.
Mr. Appliance Litigation & Risk Flags
3 Pending Actions ListedReview the full FDD for details on pending litigation.
Bankruptcy History DisclosedA bankruptcy disclosure is present in this FDD.
Litigation and bankruptcy data is sourced from Items 3 and 4 of the FDD. Always verify current status directly from the most recent FDD.
Mr. Appliance System Growth
Total Units
288
Franchised
288
Company-Owned
0
Mr. Appliance currently operates 288 franchised locations and 0 company-owned units. Unit count data is sourced from Item 20 of the FDD.
Unit History (Item 20)
| Year | Opened | Closed | Total |
|---|---|---|---|
| 2018 | 61 | 24 | 250 |
| 2019 | 52 | 26 | 277 |
| 2020 | 34 | 23 | 288 |
Transfers: 12 | Closures: 23
State Registrations
Registered in 14 states: CA, HI, IL, IN, MD, MI, MN, NY, ND, RI, SD, VA, WA, WI
Franchisor Financials (Item 21)
Revenue
$270.0M
Net Income
$-5,341,000
Total Assets
$1361.0M
Audited by BDO USA, LLP for year ending December 31.
Mr. Appliance Franchise — FAQ
The total investment to open a Mr. Appliance franchise ranges from $78,925 to $157,640, per their Franchise Disclosure Document. This includes the initial franchise fee of $53,125. The investment covers build-out, inventory, equipment, signage, working capital, and other startup costs.
Mr. Appliance charges a royalty fee of 5% - 7% of Gross Sales of gross sales, plus a 2% of Gross Sales contribution to the marketing/advertising fund. These fees are paid on an ongoing basis.
You can download the Mr. Appliance Franchise Disclosure Document free on this page. The FDD is a public document filed with state franchise registries. Always also request the current FDD directly from Mr. Appliance to ensure you have the most up-to-date version.
According to the Item 19 financial performance representation in their FDD, Mr. Appliance franchise owners report average revenue of $214 and median revenue of $207. This is based on a sample of 287 units. Past performance does not guarantee future results.
Mr. Appliance has been franchising since 1996. The FDD shows an investment range of $78,925-$157,640, a 5% - 7% of Gross Sales royalty, and includes an Item 19 earnings disclosure. There are 3 pending litigation action(s). Review the full FDD and contact current franchisees listed in Item 20 before making any investment decision.
The franchise fee is $53,125 and the total investment ranges from $78,925 to $157,640 depending on location size and market. Contact the franchisor directly for current net worth and liquid capital requirements, territory availability, and application details.
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Data Source & Disclaimer: This website is for informational purposes only. It is not an offer to sell or buy a franchise. This profile is based on publicly available FDD data sourced from state franchise registry filings. All information is for research purposes only and does not constitute legal, financial, or investment advice. Data may be outdated or contain errors. Always obtain the current FDD directly from Mr. Appliance and consult a qualified franchise attorney before making any investment decision. FranchiseOverview.com is operated by Franchising Compliance, LLC and is not affiliated with Mr. Appliance or any of its subsidiaries. To report an inaccuracy: info@franchiseoverview.com