This post was updated on December 13, 2016 to reflect information from Miracle-Ear’s 2016 FDD (Item 7).
Detailed Estimates of Miracle-Ear Franchise Costs Based on Item 7 (Estimated Initial Investment) of Miracle-Ear’s 2016 Franchise Disclosure Document
- Franchisees sign one Franchise Agreement which covers all existing locations as well as new locations opened in the assigned territory.
- There are certain one-time investments franchisees make when entering into the Franchise Agreement. There are also investments incurred by location, as indicated below.
1. Initial Franchise Fee: $30,000
- This is the minimum Initial Franchise Fee you will pay on the basis of an Exclusive Territory with a population of up to 250,000. The Initial Franchise Fee will be increased $4,000 for every 100,000 population increase (prorated to a percent per 100,000 population) in your Exclusive Territory. The larger the population of the Exclusive Territory, the greater the Initial Franchise Fee.
- If you are (1) an existing Miracle-Ear franchisee who acquires an additional franchise, (2) acquiring an Exclusive Territory which includes Pre-franchised Territory, or (3) an individual who has been selling hearing aids for at least 12 months, Miracle-Ear reserves the right, in its sole discretion, to waive all or part of the Initial Franchise Fee.
- Miracle-Ear is participating in the International Franchise Association’s Veterans Franchise Initiative known as “Vet Fran.” If you are an honorably discharged US veteran of the armed forces, you may qualify for a 10% discount off your Initial Franchise Fee.
2. Prepaid Expenses – Franchise: $0 to $2,500
- Prepaid Expenses include business insurance, rent/utility deposits, business incorporation, license and registration fees, and hearing aid license(s).
3. Prepaid Expenses – Location: $1,000 to $5,000
4. Travel and Living Expenses During Training: $1,500 to $5,000
5. Real Property, Build Out Costs: $10,000 to $85,000 (by location)
- If you do not own acceptable office and retail space, you must lease or license space. Locations typically are 400 to 1,500 square feet in a visible, high traffic retail, office, or medical building.
- The exact cost of any required leasehold improvements will depend on several factors, including the cost of construction drawings and architectural plans, any customized design and layout you choose beyond Miracle-Ear’s prototype plans and specifications, the condition of the premises, whether you are currently operating a hearing aid business when you become a Miracle-Ear franchisee, whether you will like to do more than the minimum required renovations, the landlord’s agreement to reimburse you for certain improvements, and other economic factors.
- If you are converting an existing retail hearing aid business to a Miracle-Ear Center, your leasehold improvement expenses may be less.
6. Furniture, Fixtures, and Equipment: $40,000 to $60,000 (by location)
- The maximum amount estimated for furniture, fixtures, and equipment assumes you have not previously operated a hearing aid business and includes an audiometer(s), sound booth, lab supplies, and computer equipment.
- Miracle-Ear also requires other equipment for the successful operation of a hearing aid dispensing practice, including, among other items, a Real-Ear-Measurement machine, video otoscope, hearing aid diagnostic equipment, copier, fax machine, and telephone system.
- This equipment may be purchased or leased and the list may be revised or increased from time to time through updates to the Manual.
- If you are converting an existing business to a Miracle-Ear Center, you may have some of the necessary furniture, fixtures, and equipment, but you will need to update your Center’s furniture, fixtures, and equipment to the current Miracle-Ear design.
- You must utilize a computer system designed for use in your Miracle-Ear Center. The estimated amount assumes that you will purchase your computer hardware and software equipment, although you also may lease the hardware.
- Miracle-Ear will provide at no charge its proprietary software, which you must use with your computer system. You must also use the Sycle.net software, which requires a monthly fee.
- You are also required to maintain high-speed Internet access.
7. Signage: $1,500 to $10,000 (by location)
- This item is for interior and exterior signs for your Center. Signs must meet Miracle-Ear’s standards and specifications and comply with any local government regulations.
8. Inventory: $5,000 to $10,000 (by location)
- You will need to purchase an initial supply of approved hearing aids, batteries, parts, accessories, and other related supplies.
9. Additional Funds – 3 Months: $30,000 to $80,000 (by location)
- This amount estimates expenses you will incur during the first 3 months of Center operations, including initial wages and fringe benefits; insurance premiums; rent; marketing; taxes; office, paper, and cleaning supplies; and telephone hook-up. It does not include inventory costs beyond the opening inventory costs identified in the table.
- The amounts are estimates and Miracle-Ear cannot guarantee that you will not incur additional expenses.
10. Location Total: $87,500 to $250,000
- Location totals do not include the initial investment to become a franchisee and is based on Miracle-Ear’s estimate of nationwide average costs and prevailing market conditions.
- Miracle-Ear has limited recent information received from a small sample of franchisees who have opened Centers in the past 5 years.
11. Total: $119,000 to $287,500
- This total is an estimate of your initial investment and is based on Miracle-Ear’s estimate of nationwide average costs and prevailing market conditions.
- Miracle-Ear has relied on its over 30 years of franchise experience and over 60 years of experience in the hearing products business to compile these estimates, although it has only a limited amount of recent information on which to base these estimates.