Franchise Cost in India: What You Actually Pay (2026 Guide)

A franchise in India typically costs ₹50,000 to ₹5 lakh for a kiosk or home-based format, ₹5–30 lakh for a small outlet or service unit, and ₹30 lakh to ₹2 crore for a full retail or restaurant store. The franchise fee is only one line of that: interiors, equipment, deposit, stock and working capital account for most of it.

Franchise fee: ₹1–25 lakh, one time, and rarely refundable.
Fit-out, equipment, deposit and opening stock usually dwarf the fee.
Hold six months of working capital back before you commit the rest.

Reviewed by Shrenuj Jalan, Chartered Accountant · September 2026

The ranges here are editorial — they describe what franchising in India typically asks for at each format size. They are not any brand's figures. Every number on a listing on this site is entered by the brand itself and reviewed before it publishes.

Typical cost by outlet format

Format	Area	Franchise fee	Fit-out	All-in
Kiosk or cart Mall or high-street kiosk. Rent is usually a revenue share. Exclusive territory is rarely offered at this size.	40–100 sq ft	₹50,000 – ₹2 lakh	₹1 – 4 lakh	₹2 – 8 lakh
Counter / takeaway The most searched band in India. Two to four staff, delivery-led revenue, and the format where brands start offering a defined area.	150–300 sq ft	₹1 – 4 lakh	₹5 – 12 lakh	₹8 – 20 lakh
Small format store Seating or shelf-led retail with a manager. Deposit and working capital start to matter as much as the fit-out.	300–800 sq ft	₹3 – 8 lakh	₹12 – 30 lakh	₹20 – 45 lakh
Full-service outlet Kitchen, treatment rooms or a full showroom, six or more staff. You are hiring a manager you have not met yet — budget for that.	800–2,000 sq ft	₹5 – 15 lakh	₹30 – 80 lakh	₹45 lakh – 1.2 crore
Master or area development You are buying the right to develop a territory and appoint sub-franchisees, with an opening schedule attached.	Multiple units	₹25 lakh upwards	Per unit, as above	₹1 crore upwards

What the total is made of

Franchise fee: One-time, paid to the brand for the licence, training and launch support. Typically 5–15% of what you will spend in total, which is why quoting the fee as 'the cost' is misleading.
Interiors and fit-out: Civil work, furniture, lighting, signage. Usually the largest line. Ask whether the brand mandates a vendor and whether the quoted rate per square foot is carpet or built-up area.
Equipment and initial stock: Kitchen equipment, POS, chillers, opening inventory. Ask whether stock must be bought from the brand and at what margin.
Deposit: Refundable to the brand and/or the landlord. Refundable is not the same as available — it is locked for the length of the term.
Licences and statutory: FSSAI, trade licence, GST registration, shop and establishment, fire clearance where applicable. Small individually, not small together.
Working capital: Three to six months of rent, salaries, utilities and restocking. The single most common thing a first-time franchisee underestimates.

Franchise fee is not the investment

A brand quoting a ₹3 lakh franchise fee for a 250 sq ft counter is usually describing a ₹15–20 lakh commitment once interiors, equipment, deposit and three months of working capital are in. Neither figure is dishonest on its own; the gap between them is where first-time franchisees get hurt. When you compare two brands, compare all-in numbers on the same format and the same city, never fee against fee.

What you keep paying

Royalty is charged on revenue, not profit, so it is payable in a bad month too. A marketing or brand-fund contribution is often charged on top. Add rent, salaries, utilities, and any margin the brand takes on supplies you are required to buy from it. A 6% royalty plus a 2% brand fund is 8% of everything that crosses the counter before you have paid for a single sack of flour.

Reading a payback claim

Payback figures are projections built from an assumed footfall and an assumed average order value. Ask for both assumptions in writing, then ask what an existing outlet in a comparable city actually does. Break-even — the month revenue covers costs — arrives well before payback, and the two are frequently conflated in franchise marketing.

Eight questions to ask before you pay anything

Is the quoted investment capex only, or does it include working capital and deposit?
Is the area requirement carpet area or built-up?
Is royalty charged on gross revenue or net, and is the marketing contribution on top?
Can I see the unit economics of an existing outlet in a comparable city, not a model?
How many outlets opened in the last 24 months, and how many closed?
Is the territory exclusive, and is that exclusivity written into the agreement with a boundary?
What does renewal cost at the end of the term, and can the brand refuse it?
If I want to exit, what does the transfer clause allow?

Franchise cost: common questions

+What is the difference between franchise fee and total investment?

The franchise fee is a one-time payment for the rights to the brand and its system. Total investment is everything you spend to open: the fee plus fit-out, equipment, signage, rent deposit, opening stock, licences and working capital. The fee is usually the smallest line in that list.

+What royalty is normal for an Indian franchise?

Rates vary widely by brand and format, so compare the royalty each brand publishes on its listing rather than a market average. Most charge a percentage of monthly sales, sometimes with a minimum guarantee. Some formats charge a flat monthly fee instead, and a few take their margin in the supply price rather than as a royalty. Always ask which model applies and whether the royalty is on gross or net sales.

+How long does a franchise take to pay back?

It varies by brand and format; each listing here shows the payback period the brand itself publishes. Those figures are projections built on an assumed footfall and average order value, so ask for both assumptions in writing and compare them against what an existing outlet in a similar city actually does. Break-even, when revenue first covers costs, arrives well before payback.

+Are there hidden costs in a franchise agreement?

Common ones are a renewal fee at the end of the term, mandatory refurbishment every few years, a marketing or brand-fund contribution separate from the royalty, compulsory purchase of supplies from the franchisor, and training or audit charges. Ask for a written list of every recurring payment before you sign.

Where to go next

Browse opportunities →Franchise glossary →How to start a franchise →Zero investment franchise →Franchise loan in India →Insights →List your brand →

What does a franchise cost in India?