Franchise ROI Calculator · India
Thinking of buying a franchise? Enter the fee, setup cost, royalty and expected revenue to see your real monthly profit, payback period and ROI — before you sign. Made for first-time franchise buyers in tier-2 and tier-3 cities.
1 · One-time investment
What you pay upfront to open the outlet.
2 · Monthly economics
Expected once the outlet is running.
Your franchise returns
Monthly profit and how fast you get your money back.
Franchise ROI: will the numbers actually work?
Franchise enquiries are booming across tier-2 and tier-3 India, but a glossy brochure rarely shows the real returns. Before you pay a franchise fee, you need to know two things: how much profit the outlet makes each month after the royalty, and how many months it takes to get your investment back. This free calculator works both out from your own numbers, so you can compare franchises honestly.
How the calculation works
Monthly profit = Revenue − COGS − Royalty − Ad fee − Rent − Staff − Other
Payback period = Total investment ÷ Monthly profit and Annual ROI = (Monthly profit × 12) ÷ Total investment
Total investment adds the franchise fee, setup and interiors, equipment and stock, and the security deposit. The deposit is usually refundable later, but you still fund it upfront, so it counts toward payback.
The trap most buyers miss: royalty is on revenue
Franchise royalty is charged on your sales, not your profit — typically 4–10% — and many brands add a separate advertising fund fee of 1–3% on top. On thin margins this matters enormously: a 6% royalty on a business making 12% net margin takes half your profit. Always model both, which this tool does by default.
What is a healthy payback?
Many Indian franchise investors aim for a payback within 18–36 months. Faster is better, but a slightly longer payback can still be fine for a strong, long-lived brand. Use the break-even revenue figure to see the minimum monthly sales you need just to avoid a loss — a crucial reality check for a new location.
Frequently asked questions
How is franchise ROI calculated?
ROI = annual profit ÷ total investment, as a percentage. Annual profit is monthly profit (after royalty and all costs) times twelve.
Is royalty on profit or sales?
On sales (revenue), almost always. Many franchises also charge a separate ad-fund fee, also on revenue.
Does the security deposit count?
It is part of your upfront outlay so it is included in total investment and payback, even though it may be refunded when you exit.
Is this tool free and private?
Yes — completely free, no sign-up, and everything runs in your browser. Nothing you enter is stored or uploaded.