Restoration 1 franchise unit economics
Restoration 1 franchisees work water, fire, smoke and mold claims, plus the reconstruction that follows, across a territory of roughly 250,000 people. Cost of goods takes 43.8% and other expenses 38.5%, leaving 10.0% once owners and management are paid. One line moves everything else: a full-time business development hire separates $2,174,654 from $628,092.
- Primary source
- Restoration 1 Franchise Holding, LLC, 2026 Franchise Disclosure Document
- Items read
- Item 7 for cost to open; Item 19 for sales and any profit figure; Item 20 for the location count
- Population
- 118 of 278 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.
Franchisees who kept one person on business development full-time billed $2,174,654. Those who did otherwise billed $628,092. At one territory the split is $1,251,098 against $561,145. The same ground, the same trade, one salaried role.
- A full-time business developer separates $1,251,098 from $561,145 on a single territory. 2.2 times, across 22 franchisees against 37. System-wide the split is $2,174,654 against $628,092.
- Every franchisee holding four or more territories has one. The without-development table stops at three territories; all 11 franchisees at four and above appear only in the full-time column.
- The published bottom line is 10.0% of revenue, and the median owner draws 0.8%. $142,759 at the system average, with management wages at a 0.0% median *, more than half the group pays itself a token amount.
- The royalty line reconciles to the fee schedule exactly. 7% on the 77.8% core share plus 2% on the 21.2% construction share gives 5.87% against a filed 5.9% *.
- The system lost 20 territories in 2025 and 11 more after year end. 298 down to 278, with 30 territories terminated or ceased during the year.
How much does a Restoration 1 franchise make?
The average Restoration 1 unit reported $1,427,586 of revenue in the 2026 FDD, and the median reported $760,111. The brand’s disclosure document puts the profit line at 10% of revenue. Fees come off the top first, at about 6% 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 Restoration 1 performers
Restoration 1 splits its locations into groups instead of publishing one average. The best group averaged $4,977,002 a year. The worst averaged $818,415. Both run the same brand, on the same agreement, paying the same fees. The middle location sold $760,111. The average was $1,427,586. More than half the system is below the number the brand quotes.
Decided before you open
- Trade area and site.A 6.1× gap between bands is not an operating gap. Catchment, daytime population and what sits next door set the ceiling before the first customer arrives.
- Capacity, fixed at build.capacity is None vans multiplied by hours multiplied by how full they run. What you can sell is set by the build, and the build does not change after opening.
- Territory, and how much of it is real.This model sells from a territory rather than a building, quoted at 250,000 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 $126,525 to $309,500, a 2.4× 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.
- Lease economics.Occupancy cost ran 4.9% of sales in this filing. The rent does not fall when sales do, so the same lease is a far heavier line at the bottom of the system than at the top. That is how a weak site compounds into a weak profit line.
Live operating levers
- Cost of what you sell.Products and materials take 43.8% of sales, against 10.0% kept at the end. Buying terms, price discipline and waste are where this is won, and each of them compounds at volume. Small movements here move the result more than anything else, because nothing else in the structure is that large.
- Occupancy, the line that does not flex.Rent and building costs take 4.9% of sales here. Sales per square foot and the hours the space is earning are the only two ways to move it, because the rent itself is fixed at signing.
- Routes, the operating driver.This model bills on routes. The van costs the same whatever it does that day, so the owner works on how many stops fit into it and how far apart they are. 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 6.0% 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.118 of 278 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.
The profit and loss
Ten percent, after the owner.
| Line | Average | Median | Favourable to average | At $1,427,586 * |
|---|---|---|---|---|
| Core services revenue | 77.8% | 82.0% | 54.7% | $1,110,662 |
| Construction revenue | 21.2% | 15.9% | 44.0% | $302,648 |
| Miscellaneous revenue | 1.0% | 0.0% | 13.3% | $14,276 |
| Hourly labor and subcontractors | 25.7% | 27.2% | 49.3% | $366,890 |
| Royalties | 5.9% | 6.3% | 44.0% | $84,228 |
| Equipment and vehicle | 5.2% | 4.4% | 58.7% | $74,234 |
| Materials and supplies | 4.9% | 3.1% | 69.3% | $69,952 |
| Miscellaneous cost of goods | 1.2% | 0.7% | 70.7% | $17,131 |
| Referrals and commissions | 0.9% | 0.0% | 80.0% | $12,848 |
| Total cost of goods | 43.8% | 43.0% | 53.3% | $625,283 |
| Gross profit | 56.2% | 57.0% | 53.3% | $802,303 |
| General and administrative wages | 14.1% | 10.3% | 66.7% | $201,290 |
| Advertising | 7.4% | 6.0% | 61.3% | $105,641 |
| Professional fees | 5.5% | 5.1% | 57.3% | $78,517 |
| Building costs | 4.9% | 3.9% | 62.7% | $69,952 |
| Technology | 2.1% | 1.9% | 61.3% | $29,979 |
| Miscellaneous | 1.7% | 0.2% | 74.7% | $24,269 |
| Office | 1.5% | 0.8% | 72.0% | $21,414 |
| Travel | 1.2% | 0.8% | 68.0% | $17,131 |
| Other expenses | 38.5% | 36.8% | 50.7% | $549,621 |
| Other income | 0.6% | 0.1% | 21.3% | $8,566 |
| Profit before owners and management | 18.3% | 17.1% | 48.0% | $261,248 |
| Owner's expense | 5.0% | 0.8% | 68.0% | $71,379 |
| Management wages | 3.4% | 0.0% | 68.0% | $48,538 |
| Profit after owners and management | 10.0% | 8.0% | 58.7% | $142,759 |
Percentages and favourable-to-average shares are as the brand reported it, reordered here by size within each block. The dollar column is marked *, applying each average to the system's $1,427,586.
The average franchisee keeps 10.0% after paying itself; the median keeps 8.0%. $142,759 and $114,207 at the system average *. Publishing a figure this far down the statement is rare, and it is the number that makes every other line on this page readable.
The median owner's expense is 0.8% and the median management wages is 0.0%. Against averages of 5.0% and 3.4%. So for more than half this group, the 10.0% bottom line arrives largely before anyone has been paid for running the business. Means the published profit and the owner's income are much the same money.
Hourly labor and subcontractors take 25.7% and general wages takes another 14.1%. $568,180 together at the system average *, 39.8% of revenue on people, against 4.9% on materials. Restoration is a labor business with an equipment line attached.
Professional fees run 5.5% of revenue. $78,517 at the system average *, and nearly as much as the entire royalty. In a trade billing insurers and adjusters that figure reads as the cost of getting claims paid. It is among the highest professional-fee lines published in this library.
Construction is 21.2% of average revenue and 15.9% of median revenue. The gap says a minority of franchisees lean heavily on reconstruction. The 24 territories where construction passed 60% of revenue run materially different economics and sit outside the table. So what you are reading is the core-led business.
One salaried role
The difference is one job description.
| Territories | With full-time development | Franchisees | Without | Franchisees | Multiple * |
|---|---|---|---|---|---|
| One | $1,251,098 | 22 | $561,145 | 37 | 2.23 |
| Two | $1,518,681 | 18 | $739,073 | 14 | 2.05 |
| Three | $2,595,446 | 9 | $781,976 | 6 | 3.32 |
| Four | $1,399,255 | 2 | n/a | 0 | n/a |
| Five to seven | $4,977,002 | 9 | n/a | 0 | n/a |
| All | $2,174,654 | 61 | $628,092 | 57 | 3.46 |
Revenue figures and franchisee counts are as the brand reported it; the multiple column is marked *.
A single territory with a full-time business developer billed $1,251,098 against $561,145 without. An extra $689,953 on identical ground. Thirty-seven of the 59 single-territory franchisees chose otherwise, and their median was $394,520 against $836,618 for the 22 who staffed the role.
Every franchisee at four territories or more staffs the role. The without-development table stops at three. Eleven franchisees hold four to seven territories and all of them appear only in the full-time column. So at scale this stops being a choice in the published record.
The gap widens at three territories to 3.3 times. $2,595,446 against $781,976. Nine franchisees against six, on the same territory count. Adding ground without adding the role produced $260,659 a territory; adding both produced $865,149 *.
The lowest figure in both groups is nearly identical. $133,035 with development against $42,159 without, at one territory. The role raises both the average and the middle figure. It does not lift the bottom: 22.7% of that group reached its own average, against 35.1% of the other.
At the 10.0% bottom line, the role is worth $154,656 a year. 10.0% of the $1,546,562 revenue gap *. Against a salaried business developer’s cost, that is the clearest single return anywhere in this model.
Territories and scale
More ground, less from each acre.
| Territories | Franchisees | Average revenue | Median | Range | Average population | Revenue per territory * | Revenue per head * |
|---|---|---|---|---|---|---|---|
| One | 59 | $818,415 | $526,145 | $42,159 – $5,221,437 | 380,679 | $818,415 | $2.15 |
| Two | 32 | $1,177,603 | $731,462 | $77,417 – $7,424,409 | 651,571 | $588,802 | $1.81 |
| Three | 15 | $1,870,058 | $2,039,967 | $132,717 – $4,127,975 | 972,046 | $623,353 | $1.92 |
| Four | 2 | $1,399,255 | $1,399,255 | $759,725 – $2,038,785 | 1,208,517 | $349,814 | $1.16 |
| Five to seven | 9 | $4,977,002 | $2,955,011 | $1,137,431 – $22,503,672 | 1,841,350 | n/a | $2.70 |
| All | 118 | $1,427,586 | $760,111 | $42,159 – $22,503,672 | n/a | n/a | n/a |
Franchisee counts, revenue, medians, ranges and populations are as the brand reported it; the per-territory and per-head columns are marked *.
A second territory brought revenue per territory from $818,415 down to $588,802. *. Revenue per head of population falls the same way, $2.15 to $1.81. The third territory recovers a little at $623,353, and the two franchisees holding four sit at $349,814. So through the middle of this system, ground is being added faster than it is being worked.
The single-territory median is $526,145 against an average of $818,415. A $292,270 gap created by a $5,221,437 high. Fifty-nine franchisees hold one territory and 28.8% reach their own average, so the typical single-territory business trades at roughly two thirds of the published figure.
Population inside one territory runs from 250,532 to 2,494,345. Ten times, all described as one territory. The single-territory average covers businesses that differ by ten times, so it is a weak comparisone in the ground itself.
The nine largest franchisees average $4,977,002 with a median of $2,955,011. One business selling $22,503,672 lifts that average. Their revenue per head of $2.70 is the highest-selling in the table.
The three-territory group is the only one whose median beats its average. $2,039,967 against $1,870,058, with 53.3% reaching it. Owners in that group are closest together in sales, and furthest apart on whether they employ a salesperson.
Fees and what it costs to open
Seven on the core, two on the build.
| Level | Collected revenue | Royalty | Effective rate | Technology | Total | Share |
|---|---|---|---|---|---|---|
| With full-time development, all | $2,174,654 | $129,174 | 5.94% | $6,300 | $135,474 | 6.2% |
| System average | $1,427,586 | $84,799 | 5.94% | $6,300 | $91,099 | 6.4% |
| One territory, average | $818,415 | $48,614 | 5.94% | $6,300 | $54,914 | 6.7% |
| Without full-time development, all | $628,092 | $37,309 | 5.94% | $6,300 | $43,609 | 6.9% |
| One territory, median | $526,145 | $31,253 | 5.94% | $6,300 | $37,553 | 7.1% |
| Lowest-selling reporting franchisee | $42,159 | $24,179 | 57.35% | $6,300 | $30,479 | 72.3% |
Ours, applying the published rates to filed revenue at the system's own 77.8% core and 21.2% construction mix.
The effective royalty is 5.94% of collected revenue at the current mix. *, and the cost table lands at 5.9%, close enough to accrue the blend with confidence.
The $2,000 monthly minimum binds below roughly $435,000 of collected revenue. *, at the system mix. The single-territory median is $526,145, so a meaningful share of the single-territory group sits at or under that line. At the lowest-selling reporting franchisee's $42,159 the minimum alone is 57.4% of revenue.
Construction sales pay 2%. Everything else pays 7%. A five-point difference on 21.2% of the average franchisee’s revenue, worth $15,132 a year *. Construction-heavy territories sit outside the cost table, though, so the cheaper royalty comes with thinner evidence about what the work actually returns.
Three further charges are disclosed at zero and could reach 4.5%. A 2% brand fund, a 0.5% reconstruction brand fund and a 2% local advertising requirement, all currently uncharged. At the system average, switching them on would add $61,806 a year *, more than two fifths of the published 10.0% bottom line.
What it costs to open a territory.
| Item | Low | High |
|---|---|---|
| Franchise fee | $59,900 | $64,400 |
| Additional funds, three months | $40,000 | $75,000 |
| Vehicle | $4,500 | $70,000 |
| Service tools and equipment | $1,200 | $48,000 |
| Training expenses for three people | $4,700 | $14,100 |
| Insurance | $7,000 | $12,000 |
| Licenses and permits | $250 | $5,000 |
| Technology systems components | $1,650 | $4,750 |
| Certifications | $2,200 | $4,000 |
| Marketing materials | $500 | $2,500 |
| Encircle software | $225 | $2,500 |
| Technology fee | $2,100 | $2,100 |
| Professional fees | $1,500 | $2,000 |
| Office equipment and supplies | $300 | $1,000 |
| Real estate and rent | $0 | $1,000 |
| Uniforms | $250 | $650 |
| Renovations and improvements | $250 | $500 |
| Total | $126,525 | $309,500 |
As the brand reported it, reordered here by size.
The vehicle and the service equipment account for the whole range. $5,700 at the low end against $118,000 at the high, 64% of the $182,975 difference between the two columns *. A franchisee starting with one truck and basic drying equipment builds at a third of the cost of one starting fully fitted.
Cash to run the business day to day of $40,000 to $75,000 covers three months. The second largest line after the fee, and a sensible weighting for a trade that bills insurers. The work is done and the equipment runs for weeks before a claim settles. So the gap between job completion and collection is the real capital requirement here.
A second territory costs $10,000 less and a third $20,000 less. $49,900 and $39,900 against $59,900. Set against per-territory revenue falling from $818,415 to $588,802 at two territories *, the cheaper ground still has to be worked to be worth holding.
Ground is priced at 18 cents a head above 250,000 people. So a 500,000-person territory costs $104,900 in franchise fee against $59,900 for a 250,000-person one. Revenue per head runs $1.16 to $2.70, which makes that 18 cents recoverable inside the first months of trading, if the ground is actually covered.
Questions we get asked
Questions owners ask.
What should a Restoration 1 business be billing?
Across 118 franchisees holding 231 territories, 2025 total collected revenue averaged $1,427,586 with a median of $760,111, and 29.7% reached the average. By territory count: $818,415 across 59 owners with one territory, $1,177,603 across 32 with two and $1,870,058 across 15 with three, $1,399,255 across two holding four and $4,977,002 across nine holding five to seven. The highest franchisee collected $22,503,672 and the lowest $42,159. There were 278 franchised territories at 31 December 2025, down from 298, and 11 more have ceased operating since.
What does a full-time business developer do to the numbers?
Franchisees with at least one dedicated person developing business full-time averaged $2,174,654 against $628,092 for the rest, 3.5 times, which is marked *. At a single territory the split is $1,251,098 across 22 franchisees against $561,145 across 37, and medians of $836,618 against $394,520. At two territories it is $1,518,681 against $739,073 and at three $2,595,446 against $781,976. Every one of the 11 franchisees holding four or more territories staffs the role. At the published 10.0% bottom line, the system-wide revenue gap of $1,546,562 is worth $154,656 of profit a year, which is marked *.
What does the business actually keep?
Across 75 franchisees holding 148 territories, cost of goods averaged 43.8% of collected revenue, leaving a 56.2% gross profit. Other expenses took 38.5% and other income added 0.6%, giving 18.3% before owners and management. Owner's expense averaged 5.0% and management wages 3.4%, leaving 10.0% after both, with a median of 8.0%. The median owner's expense was 0.8% and the median management wages was 0.0%. So for more than half the group the bottom line and the owner's income are substantially the same money. Royalties sit inside cost of goods at 5.9%. Depreciation, amortization, interest and taxes are excluded, and this table covers a narrower population than the revenue tables.
What does the brand take?
The royalty is 7% of collected sales other than construction, or a minimum, whichever is higher. The minimum is nothing for six months, then $500 a month in months 7 to 24, $1,500 in months 25 to 36 and $2,000 thereafter. A conversion franchise pays 3.5% for its first six months. Construction sales pay a separate 2% royalty. Technology costs $525 a month per market territory and may rise 15% a year on a compounding basis. A 2% brand fund contribution, a 0.5% reconstruction brand fund contribution and a local advertising requirement of up to 2% sit in the agreement and are currently uncharged. Marketing outside the market territory costs the greater of $5,000 an incident or 100% of the job value obtained there. At the system revenue mix the effective royalty is 5.94%, which is marked *, against the 5.9% royalty line in the cost table.
Who does bookkeeping for a Restoration 1 franchise?
Three mechanics shape the close. Revenue is measured on collection, and the royalty follows it. The fee follows the insurer's payment date, not the job date. A strong month of work and a strong month of sales are different months and have to be tracked separately. Second, the royalty runs at two rates, 7% on core services and 2% on reconstruction. So the revenue ledger has to separate those streams from the first invoice. The blend lands at 5.9% of total sales. Any drift from that is worth investigating. Third, the profit and loss stops at 10.0% after owners and management while the median owner’s expense is 0.8%. So benchmarking against it means deciding first whether your own pay sits inside or outside the comparison. Underneath all of it, professional fees at 5.5% and general wages at 14.1% are the two largest controllable lines below gross profit. Averan provides bookkeeping, controller, and fractional CFO support for franchise owners and has Certified QuickBooks ProAdvisors on the team.
Questions worth putting to Restoration 1
The filing answers what it answers. These are the gaps an owner or a buyer should close directly.
- Is the profit figure in Item 19 before or after owner pay, and how many locations sit below it?
- 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 Restoration 1 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 →Is someone on business development full-time?
A structured review of your unit economics, cash forecast. Reporting, built around collection timing, two royalty rates, and the profit line that sits below the owner's own pay.
Request the review