Check Out Kid to Kid’s Unit Economics
Any time you’re making an investment, numbers matter. Kid to Kid attracts many entrepreneurs because of our shared passion for giving back to families and communities. But what makes us even more attractive is the earning potential for each store.
Kid to Kid prides itself on being an accessible franchise opportunity with low barriers to entry. By comparing our startup costs to our sales figures—and adding anticipated industry growth to those numbers—aspiring Kid to Kid owners can see for themselves how favorable our return on investment really is.
How much it costs
Kid to Kid’s startup costs are modest for the retail apparel market. Because we source gently used clothing from the community, there’s a lower upfront investment in inventory. Plus, our low franchise fee of $25,000 means more aspiring business owners can fulfill their dreams.
We typically look for franchisees who have both liquid capital ($100,000 to $125,000) and net worth ($200,000) to ensure they are a financial fit for Kid to Kid ownership.
The average total investment for a new Kid to Kid location is between $347,200 and $542,100 per Item 7 in our 2022 Franchise Disclosure Document. This range includes all potential costs, including the franchise fee, retail location, starting inventory, grand opening promotion and more.
Most Kid to Kid franchisees launch their businesses by obtaining financing through the SBA or another lender. SBA loans can cover up to 80% of the initial investment, making them a strong choice. From there, your loan can be repaid from your store’s revenue once you open in about a year.
Kid to Kid’s profit potential
The startup costs for Kid to Kid seem even more modest when compared to the earning potential of our stores. Each store is unique and will see varied success based on the strength of its market, the quality of its employees, and how hard each franchisee works. However, our franchise system’s success is clearly demonstrated by our 100+ locations across the country!
According to Item 19 in our 2022 Franchise Disclosure Document, the average Kid to Kid store in the top 25% of owners saw $1,096,422 in sales. Their average gross profits were $716,584, and their average net income was $173,969.
The next 25% of stores also demonstrated high sales. The average store owner in the second quartile saw $716,086 in sales, average gross profit of $474,663, and average net income of $100,688.
Over the course of your franchise partnership, Kid to Kid store owners receive tremendous support not only from our corporate team but also from other stores. We value transparency and allow owners to see sales data from other stores in the system. This encourages owners to work even harder and learn from each other in the pursuit of greater collective success.
The resale clothing industry outlook
It’s clear that Kid to Kid’s franchise opportunity provides lots of financial potential, but what’s also important to consider is the future of the resale apparel industry. Our owners are not just making money now. Kid to Kid owners will continue to be positioned for success thanks to the projected growth in the resale market.
The resale industry has been on a path of growth for the past decade. It saw record growth last year—and this growth is poised to continue. According to thredUP’s 2022 Resale Report, the U.S. secondhand market is expected to more than double by 2026, reaching $82 billion. In the apparel market, specifically, this growth stands strong. Compared to the broader retail clothing sector, resale clothing is on track to grow 16 times faster by 2026.
Retail remains a smart choice within franchising, as well. According to Franchise Times magazine, the retail category for franchising had sales of $147.9 billion in 2021.
Kid to Kid’s numbers speak for themselves, but it doesn’t hurt to contemplate the growing industry we’re firmly rooted in and our increasing number of franchise locations across the country. If you’re interested in investing in a business with low barriers to entry and strong earning potential, don’t miss out on this opportunity. Request information online to learn more about our children’s resale clothing franchise.