Most articles just say "it depends." While that's technically true, it doesn't help much. Here’s where your money actually goes, what affects the cost, and where owners often underestimate.
In Australia, setting up a franchise system usually costs between $25,000 and $100,000. The price varies depending on how much of your business is already documented, how complex your operation is, your specific industry and how much work you do yourself.
That amount covers devising the strategy, building the systems, drafting Code compliant legal documents and then of course taking the franchise to market. It doesn’t include the cost of running the franchise after it’s set up, which we’ll discuss later.
Franchising costs fall into five parts: legal documentation, the operations manual, the financial model, brand and marketing assets, and franchisee recruitment.
| Component | Typical range (AUD) | What drives the cost |
|---|---|---|
| Franchise agreement & disclosure document | $8,000 – $20,000+ | Prepared by a franchise lawyer. Cost rises with territory complexity, multiple business formats, or supply arrangements that need documenting. |
| Operations manual | $10,000 – $40,000+ | Usually the largest single item. Depends almost entirely on how much of your business is already written down. |
| Financial model & fee structure | $3,000 – $10,000 | Setting the initial fee, royalty rate and marketing levy so both sides can make money. |
| Brand & marketing assets | $3,000 – $15,000 | Trademark registration, brand guidelines, franchisee-facing marketing templates. |
| Recruitment framework | $3,000 – $8,000 | Prospectus, selection criteria, interview process, onboarding. |
The single biggest factor is how much of your business is already documented. An owner with written processes, defined roles and clean financials will pay substantially less than one starting from nothing.
Beyond that, five things move the number:
Setting up the system is a one-time cost. Running it is ongoing. Plan for annual legal updates, field support for franchisees, marketing fund administration, and your own time managing the network.
The obligation that catches new franchisors out is disclosure. Under the Franchising Code of Conduct you must review and update your disclosure document at least once a year, and again during the year if anything material changes. That is a recurring legal cost, not a one-time expense, and the ACCC has been actively enforcing the deadlines.
You’ll also need to support franchisees before royalty income covers the cost. Your first two or three franchisees will need more of your time than their fees pay for, so make sure to budget for that gap.
Three places: the operations manual, their own time, and the support cost of early franchisees.
The operations manual. Owners often believe their business is more documented than it really is. Knowing how to do something and writing it down so someone else can follow are very different, and most of the work is in closing that gap.
Your own time. Franchising can’t be completely outsourced. While we have extensive experience developing operations manuals across a wide range of industries, no one knows your business as well as you do. You will need to contribute your knowledge and review the manuals, financial model and recruitment framework we prepare to ensure they accurately reflect how your business operates. This requires a genuine commitment of time while you continue running the existing business.
Early franchisee support. Your first franchisees are your proof of concept. They will need more support than the model assumes and helping them succeed is more important than the profit from their fees.
It typically takes around six months from commencement to being ready to recruit your first franchisee. The main factor affecting timing is how quickly you can provide the information, feedback and approvals we need throughout the process.
Yes. Many businesses begin franchising from a single successful location. One proven site is enough to establish the model. That said, two is better because it provides stronger evidence that the systems, economics and customer demand can be replicated in another location.
Yes. Your franchise agreement and disclosure document are critical legal documents and must comply with the Franchising Code of Conduct. Given the significant legal obligations and penalties involved, they should be prepared by an experienced franchise lawyer, not adapted from a generic template or handled as a DIY exercise.
Usually, since the franchisee pays for the new site instead of you. But it’s not free growth. You’re trading the upfront cost for the ongoing cost of building and running a system, and you have a lasting responsibility to support people who have invested in your brand.
The Franchise Assessment is free and takes a few minutes. It will tell you whether your business is a realistic candidate for franchising before you spend anything.
