Rainbow Restoration franchise unit economics
Rainbow Restoration franchisees dry out, clean up and rebuild properties after water, fire, smoke and mold damage, mostly on insurance work. Across 284 businesses the 2025 average was $1,063,348 against a median of $601,671, and 31% reached the average. The license fee slides from 8% down to 3% as revenue climbs. So the median business hands over 10% of sales while the top tenth hands over 5%.
- Primary source
- Rainbow International SPV LLC, 2026 Franchise Disclosure Document
- Items read
- Items 5 and 6 for fees; Item 19 for sales and any profit figure
- Population
- 284 of 328 locations
- Our calculations
- Marked on the page with an asterisk. Method
- Last reviewed
- 26 September 2026
Disclosure-based. Not a forecast, not an offer to sell a franchise, and not advice.
The license fee falls a point at a time as revenue climbs, from 8% below $750,000 to 3% above $3,500,000, and it is set once a year on the previous year’s sales. That makes each threshold a cliff: billing $750,000 against $749,999 cuts the fee by $7,500 for the whole of the following year. At the top of the ladder the same single dollar is worth $35,000.
- Every rung of the ladder is a cliff worth 1% of itself.$7,500 at the $750,000 threshold, $14,000 at $1,400,000, $20,000 at $2,000,000, $27,500 at $2,750,000 and $35,000 at $3,500,000 *. The rate applies to the whole year, so a December invoice can pay for itself many times over.
- The median business hands over 10% of sales and the top tenth hands over 5%.$601,671 at 8% license plus 2% marketing, against $4,420,188 at 3% plus 2% *, a five-point range between the middle of the system and its highest-selling tenth.
- Territory population differs 12.5 times over and average revenue differs 2.4 times over.$730,906 across the 116 businesses working 40,000 to 249,999 people, against $1,736,727 across the 80 working 500,000 and up *. The ground grows far faster than the billing does.
- The lowest-selling tenth averages $30,028 against a minimum license fee of $4,500 to $10,320.15.0% or 34.4% of revenue depending on territory population *, before the marketing fee, the minimum applies everything below $56,250 in a small territory and below $129,000 in a large one.
- Departures outran openings in two of the last three years.18 opened against 19 gone in 2023 and 15 against 17 in 2025, 2024 has the entire three-year gain of 14, on 33 openings.
How much does a Rainbow Restoration franchise make?
The average Rainbow Restoration unit reported $1,063,348 of revenue in the 2026 FDD, and the median reported $601,671. The brand’s disclosure document discloses revenue and not profit, so what an owner keeps depends on the cost structure set out below. Fees come off the top first, at about 10% of sales across royalty, brand fund and the rest of the stack. Revenue is not income. Rent, wages, cost of goods and the franchise fees all come out before an owner is paid. The figures for the highest-selling and lowest-selling businesses are below.
Top performers
What separates the top Rainbow Restoration performers
Rainbow Restoration splits its locations into groups instead of publishing one average. The best group averaged $4,420,188 a year. The worst averaged $30,028. Both run the same brand, on the same agreement, paying the same fees. The middle location sold $601,671. The average was $1,063,348. More than half the system is below the number the brand quotes.
Decided before you open
- Trade area and site.A 147.2× gap between bands is not an operating gap. Catchment, daytime population and what sits next door set the ceiling before the first customer arrives.
- Territory, and how much of it is real.This model sells from a territory rather than a building, quoted at 249,999 people. Two owners with the same brand and different ground are running different businesses, and density decides how much driving sits between jobs.
- What you spend to open.Opening costs $185,336 to $351,900, a 1.9× range inside one brand. The high end usually buys more capacity, so the cheapest build is not always the cheapest route to the top band.
Live operating levers
- Claims, the operating driver.This model bills on claims. The work is done first and the carrier pays later, so the owner funds wages and materials in between and the speed of collection matters as much as the volume won. It is worth watching every week, because by the time it turns up in a monthly close the quarter is half gone.
- Fees, and where the minimum bites.Fees run about 10.0% of sales. A minimum sits underneath the percentage, so the low-volume location pays the higher effective rate. The brand charges the weakest locations the most. Work out the sales level where the percentage overtakes the minimum and know which side of it you are on, because the answer changes what an extra dollar of sales is worth.
Context you underwrite around
- The reporting screen.284 of 328 locations are behind these figures. Locations open less than the full year, brand-owned, or not meeting the reporting criteria are excluded, so the numbers describe locations that cleared that screen, not the system as a whole.
- What the disclosure leaves out.Item 19 publishes no profit or cost data for franchised locations. Anything below the sales line has to come from the franchisor or from owners you call.
Where the system sits
The average sits 1.77 times the median.
| Band | Businesses | Average | Median | High | Low | Reaching the average | Rung * | Total charge * |
|---|---|---|---|---|---|---|---|---|
| Top 10% | 28 | $4,420,188 | $3,726,109 | $14,541,506 | $2,612,014 | 10, 36% | 3% | $221,009 |
| Top 25% | 71 | $2,824,113 | $2,192,830 | $14,541,506 | $1,256,826 | 25, 35% | 4% | $169,447 |
| Top 50% | 142 | $1,853,927 | $1,245,784 | $14,541,506 | $605,282 | 44, 31% | 6% | $148,314 |
| All businesses | 284 | $1,063,348 | $601,671 | $14,541,506 | $1,643 | 89, 31% | 7% | $95,701 |
| Bottom 50% | 142 | $272,768 | $280,442 | $598,060 | $1,643 | 73, 51% | 8% | $27,277 |
| Bottom 25% | 71 | $113,109 | $81,156 | $286,828 | $1,643 | 30, 42% | 8% | $11,311 |
| Bottom 10% | 28 | $30,028 | $21,735 | $61,794 | $1,643 | 13, 46% | 8% | $4,500 |
Counts, averages, medians, ranges and attainment are as the brand reported it. The rung and total-charge columns are marked *, applying the ladder plus the 2% marketing fee to each group averages. The bottom tenth governed by the minimum instead of the rate.
The median business bills $601,671, which is 56.6% of the average. $1,063,348 against $601,671 *, 89 of 284 reach the average, so the arithmetic mean describes a position that seven businesses in ten sit below.
The top half averages 6.8 times the bottom half. $1,853,927 against $272,768 *, on the same count of 142 each, and the two weighted together return the filed all-system figure of $1,063,348 to the dollar.
Attainment runs backwards: 51% in the bottom half against 31% in the top. The weak end is bunched between $1,643 and $598,060. Meanwhile the strong end is stretched by a single business at $14,541,506, 3.3 times its own group averages.
The bottom half’s average sits below its own median. $272,768 against $280,442, which happens when the tail is extreme, and here the tail runs down to $1,643.
Crossing into the 7% rung asks for $148,329 more than the median business bills. $750,000 against $601,671 *, a 24.7% step, and it pays $7,500 the following year, so the last quarter of a year spent near the line is worth planning around.
How the licence fee steps
One dollar of December revenue can be worth $35,000.
| Prior-year gross sales | License fee | Plus marketing | Total brand charge | Worth of the first dollar over the threshold * |
|---|---|---|---|---|
| $0 – $749,999.99 | 8% | 2% | 10% | n/a |
| $750,000 – $1,399,999.99 | 7% | 2% | 9% | $7,500 |
| $1,400,000 – $1,999,999.99 | 6% | 2% | 8% | $14,000 |
| $2,000,000 – $2,749,999.99 | 5% | 2% | 7% | $20,000 |
| $2,750,000 – $3,499,999.99 | 4% | 2% | 6% | $27,500 |
| $3,500,000 and over | 3% | 2% | 5% | $35,000 |
Rates are as the brand reported it and the right-hand column is marked. Comparing the fee owed one cent below each threshold with the fee owed at it.
The rate is fixed for a calendar year, so the cliff applies to twelve months of billing. A business closing 2025 at $749,999 pays 8% on everything it bills in 2026; one closing at $750,000 pays 7% on everything it bills in 2026 *, and the sales that decide it are last year’s, which are already in the system by the time the rate is set.
Reconstruction work sits outside the ladder entirely. It has its own 3% license fee and 1% marketing fee. It is excluded when the threshold is worked out. So a business that grows through reconstruction pays a lower rate on that work and stays on a higher rate for everything else.
Year one runs at a flat 6%. The ladder starts at month 13, which means a first-year business pays 6% license plus 2% marketing whatever it bills. Then lands on a rung decided by the part-year it has just traded.
Local marketing can add up to three more points. Up to 3% of gross sales through a designated local marketing group, of which 2% may be directed to brand-level awareness work. So the fully loaded charge runs from 8% at the top of the ladder to 13% at the bottom.
Territory size
Twelve times the people, twice the billing.
| Territory population | Businesses | Average | Median | High | Low | Reaching the average | Against the smallest band * |
|---|---|---|---|---|---|---|---|
| 40,000 – 249,999 | 116 | $730,906 | $430,921 | $7,519,022 | $4,656 | 33, 28% | n/a |
| 250,000 – 499,999 | 86 | $908,846 | $591,671 | $3,781,280 | $1,643 | 34, 40% | 1.24 times |
| 500,000 and up | 80 | $1,736,727 | $987,280 | $14,541,506 | $82,558 | 26, 33% | 2.38 times |
Counts, averages, medians, ranges and attainment are as the brand reported it; the final column is marked *, comparing each group averages with the smallest group.
The group minimums run 40,000, 250,000 and 500,000 people, a span of 12.5 times. Average revenue across the same three groups runs $730,906, $908,846 and $1,736,727, a span of 2.38 times *) so each extra head of population is worth progressively less.
The fee moves the other way. $60,000 buys the first 200,000 people and each further 1,000 costs $400, so a 500,000-population territory costs $180,000 *, three times the entry fee for 2.38 times the group averages.
Revenue for each dollar of entry fee falls 20.8% across that step. $12.18 of group-average revenue for each fee dollar at 200,000 people, against $9.65 at 500,000 *. The larger territory still bills more in total, and it bills less for what it cost.
What actually paid in 2025 averaged $54,788. Across a range of $40,000 to $149,326, against a $60,000 list price. So discounts and territory size pull the real entry cost either side of the headline by a wide margin.
The middle group has the best attainment and the smallest has the worst. 40% of the 250,000-to-499,999 group reaches its own average against 28% of the smallest group *. The smallest territories hold the widest internal range, running from $4,656 to $7,519,022.
The minimum
Below $56,250 the rate stops mattering.
| Territory population | Months 10–18 | Months 19–48 | Months 49 and after | Mature a yearly minimum * | Revenue where 8% overtakes it * |
|---|---|---|---|---|---|
| Under 200,000 | $225 | $300 | $375 | $4,500 | $56,250 |
| 200,000 – 500,000 | $515 | $690 | $860 | $10,320 | $129,000 |
| 500,001 – 1,000,000 | $1,315 | $1,750 | $2,190 | $26,280 | $328,500 |
| 1,000,001 – 2,000,000 | $2,815 | $3,000 | $3,750 | $45,000 | $562,500 |
| 2,000,001 and above | $3,000 | $4,000 | $5,000 | $60,000 | $750,000 |
The monthly figures are as the brand reported it and the last two columns are marked *; the three largest population groups are closed to new franchisees.
The lowest-selling tenth of the system averages $30,028. At 8% that is $2,402 of license fee, against a mature minimum of $4,500 in a small territory and $10,320 in a mid-sized one *, so the effective rate lands at 15.0% or 34.4% against 8%.
The lowest business in the system billed $1,643 for the year. The mature minimum for a mid-sized territory is $10,320 *, more than six times what the business collected, before the marketing minimum of $100 to $2,500 a month is added.
The minimum climbs by two thirds between month 10 and month 49. $225 to $375 a month in a small territory and $515 to $860 in a mid-sized one, 1.67 times in both cases *, so the charge rises on a schedule while the revenue behind it rises only if the work arrives.
Above the crossover the minimum stops mattering entirely. $56,250 in a small territory and $129,000 in a mid-sized one *, and since the bottom quarter averages $113,109, most of the system is already past it. That is what makes the bottom tenth the group to watch.
Questions we get asked
Questions an owner asks.
What does a Rainbow Restoration business bill?
Across 284 businesses trading all of 2025, the average was $1,063,348 and the median $601,671, on a range from $1,643 to $14,541,506. By percentile group the averages run $4,420,188 at the top tenth, $2,824,113 at the top quarter, $1,853,927 at the top half, $272,768 at the bottom half, $113,109 at the bottom quarter and $30,028 at the bottom tenth.
What does the brand take?
A license fee of 6% for the first twelve months. Then 3% to 8% of gross sales set each 1 January on the prior calendar year’s sales. A marketing fee of 2%. A local marketing group contribution of up to 3%. Reconstruction services have their own 3% license fee and 1% marketing fee and are excluded from the threshold calculation. Minimum license fees of $225 to $5,000 a month apply from month 10, set by territory population.
What does that work out at?
On our reading, 9% of sales at the system average of $1,063,348, 10% at the median of $601,671, and 5% at the top tenth’s average of $4,420,188. At the bottom tenth’s average of $30,028 the minimum takes over and the effective rate reaches 15.0% or 34.4%, depending on territory population.
Does a bigger territory pay?
Less than proportionately. The group minimums differ 12.5 times over, from 40,000 people to 500,000, while group averages revenue differs 2.38 times over, from $730,906 to $1,736,727. The entry fee moves the other way: $60,000 covers the first 200,000 people and each further 1,000 costs $400. So 500,000 people costs $180,000, three times the fee for 2.38 times the billing.
What does it cost to open?
$185,336 to $351,900, before real estate and before any additional franchise fee for territory beyond the minimum. The largest lines are the $60,000 franchise fee, a vehicle at $10,000 to $55,000, equipment and supplies at $41,461 to $66,000. $40,000 to $100,000 of additional funds for the first six to nine months.
How stable is the system?
328 franchised businesses at the end of 2025, down from 330, with zero company-owned outlets in any of the three years. Across 2023 to 2025, 66 opened and 52 left, 41 terminations, 8 non-renewals and 3 that ceased for other reasons. Transfers to new owners ran 5, 12 and 11. Eight franchise agreements were signed with the outlet still to open, and 23 new franchised outlets are projected for the next fiscal year.
Which two numbers should run monthly?
Gross sales against the rung you are standing on. Because a calendar year ending one dollar the wrong side of a threshold costs between $7,500 and $35,000 the following year. And reconstruction revenue kept separate from standard revenue, because it is charged at its own rate and excluded when the threshold is set.
- No profit figure. The filing reports sales and not earnings, so what an owner keeps is not disclosed.
- No cost lines. Wages, rent and cost of goods are not broken out, so margin cannot be rebuilt from the document.
Questions worth putting to Rainbow Restoration
The filing answers what it answers. These are the gaps an owner or a buyer should close directly.
- What do locations at the median spend on wages and rent as a share of sales? The filing reports sales only.
- What separates the highest-selling locations from the lowest: trade area, years open, size, or the owner?
- How long does a new location take to reach the average you publish, and what does the build-up look like month by month?
- At what level of sales do the minimum charges stop applying and the percentage take over?
- How many Rainbow Restoration locations closed, were sold, or changed hands last year, and why?
Run your own numbers.
The Franchise Finance Diagnostic runs the same checks on your own numbers. It scores where you stand and compares you with Item 19 of your brand’s FDD. It works out what one location earns and spends, and builds a 13-week cash forecast. Checks whether you are ready to open another one. It is free and it runs in your browser.
Launch the diagnostic →Which rung will you land on in January?
A structured review of your unit economics, cash forecast. Reporting, built around the threshold your calendar year is heading for, the reconstruction split that sits outside it. The collection cycle between the job and the money.
Request the reviewthe franchise library, all 243 brands · how franchise unit economics work · running the books across several locations · what Averan does for franchise owners
Rainbow Restoration reads against the rest of the restoration group: 1-800 WATER DAMAGE · DRYmedic · Paul Davis · PuroClean · Restoration 1 · ServiceMaster Restore. The restoration guide compares all of them on the same figures.
Questions owners ask next
The figures above raise these, and each one is answered on its own page.
- At what level of sales does a minimum fee stop costing me more than the percentage?How royalty, ad fund and minimums actually work on a monthly statement.
- How much cash do I fund before a new location covers its own costs?A 13-week forecast for the months before break-even.
- My payroll percentage keeps climbing. Is that a payroll problem?Usually it is a revenue problem wearing a payroll costume.
- I run several locations. Which ones actually make money?Location-level contribution, and what it takes to see it.
- How much of Item 19 can I rely on?What a financial performance representation does and does not tell you.