Koala Insulation Franchise Review 2025: Costs, Fees, News, Average Revenues and/or Profits

Koala Insulation installs building insulation in a variety of forms, such as spray foam and blown in insulation. It also provides related services such as insulation removal, air sealing, and installing solar attic fans. Homeowners are becoming increasingly interested in insulation, as it helps keep their homes hot or cool, saving money on ever-rising energy bills. This is becoming particularly relevant in areas affected by extremes of hot and cold due to the changing climate. By keeping down the costs and impacts of shifting weather, it provides security from uncertainty as well as the more direct and immediate financial benefits.

The company leans into the environmental benefits of reducing energy use, with a green logo, cute mascot, and company name that evokes nature, making people more aware of their environmental impact and appealing to people already interested in protecting nature. As well as a franchise worth looking at in itself, it’s a useful case study in how the small details of a franchise and its brand can be used to activate thoughts and feelings in its customer base, drawing in more business.

In this exclusive Franchise Chatter FDD Talk post, you’ll learn the following:

Section I – Estimated initial investment (franchise costs) for a Koala Insulation franchise, based on Item 7 of the company’s 2025 FDD

Section II – Initial franchise fee, royalty fee, and marketing fee for a Koala Insulation franchise, based on Items 5 and 6 of the company’s 2025 FDD

Section III – Number of franchised and company-owned Koala Insulation outlets at the start of the year and the end of the year for 2022, 2023, and 2024, based on Item 20 of the company’s 2025 FDD

Section IV – News updates on the Koala Insulation franchise opportunity

Section V – Presentation and analysis of Koala Insulation’s financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2025 FDD, including information on the:

• 2024 average, median, maximum, and minimum gross revenue for the 87 Koala Insulation franchisees that were operational during the entire 2024 fiscal year, grouped by level of annual gross revenue (greater than $2.0M, $1.0M to $2.0M, $500K to $1.0M, less than $500K, and total)

• 2024 average, median, maximum, and minimum gross revenue for the 8 Koala Insulation single-territory franchisees that were operational during the entire 2024 fiscal year

• 2024 average, median, maximum, and minimum gross revenue for the 79 Koala Insulation multi-territory franchisees that were operational during the entire 2024 fiscal year, grouped by thirds and overall

• 2023 gross sales, cost of goods sold, gross profit, certain marketing & operating expenses, and total revenue less cost of goods sold and certain required marketing & operating expenses for the 73 Koala Insulation franchisees who participated in the Benchmarking Study and had been operating their Koala Insulation businesses at least 12 months at the time of the Benchmarking Study

• 2024 average, median, maximum, and minimum revenue per job for the 95 Koala Insulation reporting franchisees operating in 389 franchise territories during the 2024 fiscal year that utilized the CRM for this report

• 2021, 2022, 2023, and 2024 system sales for all Koala Insulation franchisees whose Koala Insulation businesses were operational for any part, even as little as one month if the franchisee completed initial training in October of their initial year of operations, of each of the 2021, 2022, 2023, and 2024 fiscal years

Section VI – Key ratios, comparables, computations, and analyses for the Koala Insulation franchise opportunity (exclusive content for Platinum subscribers)

Section I – Koala Insulation Franchise Costs

• Koala Insulation franchise costs, based on Item 7 of the company’s 2025 FDD:

• Initial Franchise Fee:  $49,500
• Training Expenses:  $500 to $5,000
• Equipment and Vehicles:  $50,025 to $68,922
• GPS Tracking Systems:  $350 to $600
• Insurances:  $3,500 to $6,000
• Initial Advertising/Marketing:  $26,000 to $30,000
• Professional Fees:  $2,500 to $6,000
• Rent (parking location/office):  $0 to $4,000
• Office Expense:  $500 to $1,250
• Computer, Phone, and Technology Systems:  $700 to $3,000
• Technology Activation Fee:  $5,000
• Business Licenses and Permits:  $500 to $5,000
• Additional Funds – 3 Months:  $50,000
• Total Estimated Koala Insulation Franchise Costs:  $189,075 to $234,272

Section II – Koala Insulation’s Initial Franchise Fee, Royalty Fee, and Marketing Fee

• Koala Insulation’s initial franchise fee, royalty fee, and marketing fee, based on Items 5 and 6 of the company’s 2025 FDD:

• Initial Franchise Fee:  $49,500

• Royalty Fee:  6.5% of Gross Sales during the first 6 calendar months of operations (which for clarity shall begin and include any portion of any month during which you first receive any Gross Sales). Commencing with the 7th month of operations, you must pay Koala Insulation the Royalty Fees equal to: the greater of the Minimum Royalty or 6.5% of Gross Sales for the first $1,000,000 in annual Gross Sales. If Gross Sales exceeds $1,000,000 annually, the Royalty Fee will be reduced to the greater of the Minimum Royalty or 5% of Gross Sales for the remainder of that calendar year. If Gross Sales exceeds $2,000,000 annually, the Royalty Fee will be reduced to the greater of the Minimum Royalty or 4.5% of Gross Sales for the remainder of that calendar year. If Gross Sales exceeds $3,000,000 annually, the Royalty Fee will be reduced to the greater of the Minimum Royalty or 3.5% of Gross Sales for the remainder of that calendar year.

• Opening Advertising (Initial Six Months):  minimum of $2,500 per month for the month prior to opening and five months after opening

• Local Marketing (Ongoing):  the greater of $2,000 or 5% of Gross Sales per month, plus advertising agency management fees

• Brand Fund Contribution:  currently 1% of Gross Sales; maximum of 2% of Gross Sales

Section III – Number of Franchised and Company-Owned Koala Insulation Outlets

Franchised

2022

• Outlets at the Start of the Year:  248
• Outlets at the End of the Year:  326
• Net Change:  +78

2023

• Outlets at the Start of the Year:  326
• Outlets at the End of the Year:  385
• Net Change:  +59

2024

• Outlets at the Start of the Year:  385
• Outlets at the End of the Year:  395
• Net Change:  +10

Company-Owned

2022

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2023

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2024

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

Section IV – News Updates on the Koala Insulation Franchise

• Koala Insulation Opens First Franchise Location in Canada

• Koala Insulation Ranked No. 116 on Entrepreneur’s 2025 Franchise 500 List

Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Koala Insulation Franchise (Item 19, 2025 FDD)

Part 1 – Gross Sales for Koala Insulation Businesses for the 12 Months Ending September 30, 2024

• The information provided below presents Gross Sales derived by certain Koala Insulation franchisees during the period between October 1, 2023 and September 30, 2024 (“2024 Fiscal Year Reporting Period”).

• There were 395 total territories as of September 30, 2024. The information provided in the table below was compiled from 87 franchisees that were operational during the entire 2024 Fiscal Year Reporting Period. These franchisees operated 376 franchise territories during the 2024 Fiscal Year Reporting Period.

• 79 of these 87 franchisees operated in more than one territory under multiple franchise agreements during the entire 2024 Reporting Period as follows: 7 of the franchisees operated 2 territories, 15 franchisees operated 3 territories, 30 franchisees operated 4 territories, 7 franchisees operated 5 territories, 7 franchisees operated 6 territories, 4 franchisees operated 7 territories, 5 franchisees operated 8 territories, 2 franchisees operated 10 territories, and 2 franchisees operated 12 territories.

• Koala Insulation franchisees report Gross Sales to it for all of their territories on the same report. As a result, for the purposes of this Item 19, each of the 87 franchisees were considered to be one franchise even though some operate in more than one territory.

• There were 58 franchise territories that commenced operations during the 2024 Fiscal Year Reporting Period. The data includes 36 of those 58 territories that commenced operations during the 2024 Fiscal Year Reporting Period. Franchisees that operate multiple territories are required to provide aggregate data for all of their territories, and therefore, any of those existing businesses that acquired additional territories during the 2024 Fiscal Year Reporting Period were included in the data.

• The data excluded 22 territories that were purchased by a new franchisee during the 2024 Fiscal Year Reporting Period and 48 franchise territories that ceased operations during the 2024 Fiscal Year Reporting Period.

A. Total Gross Revenue

Greater Than $2.0M

• Number of Franchisees:  10
• Minimum:  $2,056,356
• Maximum:  $4,755,177
• Median:  $2,389,839
• Average:  $2,674,510
• Number Above Average:  2
• Percentage Above Average:  20.0%

$1.0M to $2.0M

• Number of Franchisees:  28
• Minimum:  $1,016,056
• Maximum:  $1,963,282
• Median:  $1,265,933
• Average:  $1,313,687
• Number Above Average:  9
• Percentage Above Average:  32.1%

$500K to $1.0M

• Number of Franchisees:  28
• Minimum:  $516,022
• Maximum:  $979,652
• Median:  $788,837
• Average:  $753,313
• Number Above Average:  16
• Percentage Above Average:  57.1%

Less Than $500K

• Number of Franchisees:  21
• Minimum:  $185,207
• Maximum:  $495,601
• Median:  $380,356
• Average:  $364,169
• Number Above Average:  11
• Percentage Above Average:  52.4%

Total

• Number of Franchisees:  87
• Median:  $848,593
• Average:  $1,060,559
• Number Above Average:  32
• Percentage Above Average:  36.8%

B. Total Gross Revenue – Single Territory

• The information provided in the table below was compiled from 8 single-territory Koala Insulation franchisees that were operational during the Reporting Period.

• The data excludes 101 franchisees that were operational during the Reporting period but operated more than one Territory during the entire Reporting Period and report gross sales to Koala Insulation for all territories on the same report, and franchisees that either began operations or ceased active operations during the Reporting Period.

Single-Territory Franchisees

• Number of Franchisees:  8
• Minimum:  $295,334
• Maximum:  $1,179,453
• Median:  $428,393
• Average:  $544,885
• Number Above Average:  3
• Percentage Above Average:  37.5%

C. Total Gross Revenue – Multi-Territory

• The information provided in the table below was compiled from the 79 multi-territory Koala Insulation franchisees that were operational during the Reporting Period, each of which operate in more than one Territory under different Franchise Agreements.

• These 79 Koala Insulation franchisees reported Gross Sales to Koala Insulation for all territories on the same report. As a result, for the purposes of the table below, each of these 79 Koala Insulation franchisees was considered to be one franchisee even though they operate in more than one Territory.

Top Third

• Number of Franchisees:  26
• Minimum:  $1,229,407
• Maximum:  $4,755,177
• Median:  $1,734,459
• Average:  $1,942,489
• Number Above Average:  11
• Percentage Above Average:  42.3%

Middle Third

• Number of Franchisees:  27
• Minimum:  $749,370
• Maximum:  $1,198,867
• Median:  $924,284
• Average:  $935,891
• Number Above Average:  13
• Percentage Above Average:  48.1%

Bottom Third

• Number of Franchisees:  26
• Minimum:  $185,207
• Maximum:  $735,074
• Median:  $478,006
• Average:  $466,761
• Number Above Average:  16
• Percentage Above Average:  61.5%

Total

• Number of Franchisees:  79
• Median:  $924,284
• Average:  $1,112,779
• Number Above Average:  28
• Percentage Above Average:  35.4%

• The Average Gross Sales figures presented above represent the total dollar value of insulation services sold during the Reporting Period by the Koala Insulation franchisees identified above.

Part 2 – 2023 Benchmarking Study for Koala Insulation Franchisee Businesses for the 12 Months Ending December 31, 2023

• In 2024, Koala Insulation conducted a financial Benchmarking Study for Koala Insulation franchisees. The Benchmarking Study was conducted solely on a voluntary basis and was offered only to franchisees who had been operating their Koala Insulation Businesses at least 12 months at the time of the Benchmarking Study. Twenty-five franchisees who joined the system in 2023 or 2024 were ineligible to participate in the Benchmarking Study.

• 73 reporting franchisees operating 288 territories (“Reporting Franchisees”), out of 386 Koala Insulation franchised territories that were open as of December 31, 2023, participated in the Benchmarking Study. Each of the 73 Koala Insulation Franchisees were located in the United States

• This Part 2 presents information for those 44 Reporting Franchisees operating in 208 territories that had been open and operating on a full-time basis for at least two full years as of December 31, 2023. 40 of the 44 reporting franchisees contained in the chart below operate in multiple territories.

Gross Sales:  $1,100,064 (100.0%)

Cost of Goods Sold

• Installer Wages:  $199,979 (18.2%)
• Job Supplies:  $329,563 (30.0%)
• Cost of Fuel and Other COGS:  $54,346 (4.9%)
• Total Cost of Goods:  $583,888 (53.1%)

Gross Profit Margin:  $516,177 (46.9%)

Certain Marketing & Operating Expenses

• Royalties & National Brand Marketing Fund:  $81,004 (7.4%)
• Advertising and Marketing:  $56,870 (5.2%)
• Rent and Utilities Expense:  $34,432 (3.1%)
• Small Tools, Equipment & Uniform Expense:  $21,590 (2.0%)
• Vehicle Expense:  $25,519 (2.3%)
• Bank Service Charges & Merchant Fees:  $12,701 (1.2%)
• Insurance:  $31,425 (2.9%)
• Licenses & Permits:  $2,359 (0.2%)
• IT & Telephone:  $8,117 (0.7%)
• Total Certain Marketing & Operating Expenses:  $274,016 (24.9%)

Total Revenue Less Cost of Goods Sold and Certain Required Marketing & Operating Expenses:  $242,161 (22.0%)

• “Gross Sales” for purposes of this Part 2 means the total of all receipts derived from all sales of completed insulation projects.

• “Installer Wages” is all gross wages paid to install staff, contractor, and subcontractors but do not include processing fees or other costs.

• “Job Supplies” includes the insulation product(s) and consumable goods required to provide the services. This does not include any shipping costs or equipment rental costs.

• “Installer Fuel and Other COGS” includes fuel purchased for the truck used to pull the Koala Rig and fuel consumed by equipment on the Koala Rig. Other COGS includes equipment rental costs, material dumping fees, and the costs of job permits and fees.

• “Royalties & National Brand Marketing Fund” was calculated by first determining the amount of Monthly Branding Royalty and National Brand Marketing Fund that each of the 44 Reporting Franchisees would have paid under the FDD, and then taking the total average of such amount.

• “Advertising and Marketing” is the amount of advertising and marketing services purchased by the franchisee in their local territories for lead generation.

• “Rent and Utilities Expense” is the amount spent on rent for office or warehouse space as well as any utilities costs for occupying those facilities.

• “Small Tools, Equipment & Uniform Expense” includes installation tools such as hammer tackers, screwdrivers, construction supplies, personal protective equipment, removable vacuum bags and staples, small equipment drills, and ladders and uniforms.

• “Vehicle Expense” includes costs of parking, tolls, maintenance, and vehicle leases, but does not include fuel or insurance.

• “Bank Service Charges & Merchant Fees” means customary fees associated with maintaining a local banking relationship and accepting payment from customers via credit cards.

• “Insurance” includes the amount spent on insurance coverage policies required under the FDD.

• “Licenses and Permits” means the amount spent on maintaining required licenses and permits to operate their Koala Insulation business.

• “IT & Telephone” means the amount spent on licensing the field services technology platform for office and field devices and maintaining a VOIP phone system.

• “Total Revenue Less Cost of Goods Sold and Certain Marketing & Operating Expenses” means the average total Revenue minus Installer Wages, Job Supplies, Cost of Fuel and Other COGS, Royalties & National Brand Marketing Fund, Advertising and Marketing, Rent and Utilities, Small Tools, Equipment and Uniform Expense, Vehicle Expense, Bank Service Charges & Merchant Fees, Insurance, License & Permits, and IT & Telephone.

• This amount does not equal the average gross profit of the 44 Reporting Franchisees that had been open and operating on a full-time basis for at least two years as of December 31, 2023, as they each incurred additional costs and expenses that are not reflected in this Part 2, including any compensation paid to either part-time or full-time office administration staff, sales personnel or operations management staff, or compensation paid to the owner.

Part 3 – Average Revenue per Job for Year Ending September 30, 2024

• The table below presents the median and average “Average Revenue per Job” for Koala Insulation projects as reported by certain Koala Insulation businesses operational during the fiscal year ending September 30, 2024.

• The information provided in the table below was compiled from reports compiled from the Customer Relationship Management (“CRM”) software utilized by Koala Insulation franchisees.

• The Average Revenue per Job report was obtained from 95 Reporting Franchisees operating in 389 franchise territories during the fiscal year ending September 30, 2024. Excluded from the report are 14 franchisees that did not utilize the CRM for this report.

Average Revenue per Job

• Number of Franchisees:  95
• Minimum:  $1,497.48
• Maximum:  $6,683.49
• Median:  $3,034.46
• Average:  $3,155.10
• Number Above Average:  38
• Percentage Above Average:  40%

• “Average Revenue per Job” is calculated by the CRM software reflecting the average revenue realized from each job that the franchisee completed and recorded in the CRM during the reporting period.

Part 4 – Koala Franchise System Sales for Years Ending September 2021, 2022, 2023, and 2024

• The information provided in the tables below is based on the aggregate Gross Sales (“System Sales”) reported to Koala Insulation from all Koala franchisees whose Koala businesses were operational for any part, even as little as one month if the franchisee completed initial training in October of their initial year of operations, of each fiscal year ended September 30, 2021, September 30, 2022, September 30, 2023, and September 30, 2024.

• 2021:  $10,467,822 (N/A)
• 2022:  $44,533,927 (325.4% sales growth)
• 2023:  $79,031,430 (77.5% sales growth)
• 2024:  $96,730,976 (22.4% sales growth)

Section VI – Koala Insulation Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️