HobbyTown Franchise FDD, Profits & Costs (2025)
HobbyTown, a prominent retail franchise specializing in hobby, collectibles, and toy products, was established in 1985 by Thom Walla, Merlin Hayes, and Mary Hayes in Lincoln, Nebraska. The company began franchising the following year in 1986 and has since expanded across 39 states in the United States.
HobbyTown is headquartered in Lincoln, Nebraska, which also remains its central hub for franchise operations. HobbyTown distinguishes itself in the retail hobby industry by offering a wide range of products including model railroading, games, radio control vehicles, models, paints, tools, and various educational items.
The franchise has built a reputation for its comprehensive product offerings and exceptional customer service, which cater to hobby enthusiasts of all ages. Each store is designed to provide a complete hobby experience with product diversity being a key element of their retail strategy.
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Initial Investment
How much does it cost to start a HobbyTown franchise? It costs on average between $323,000 – $588,000 to start a HobbyTown franchised facility.
This includes costs for construction, equipment, inventory, and initial operating expenses. The exact amount varies based on factors such as the size of the store, the location, and whether the franchisee chooses to lease or purchase the property.
| Type of Expenditure | Amount |
|---|---|
| Franchise Fee | $49,000 |
| Travel and Living Expenses While Training | $1,650 – $4,000 |
| Inventory | $150,000 – $300,000 |
| Retail Fixtures | $40,000 – $70,000 |
| Activity Area Material | $2,200 – $4,500 |
| Flooring, painting, and improvements | $17,000 – $32,000 |
| Shipping | $1,500 – $6,000 |
| Point of Sale Computer Hardware | $6,000 – $9,000 |
| Exterior Sign(s) | $6,000 – $15,000 |
| Low Voltage Network for computer information system, security system and credit card machines | $2,750 – $3,500 |
| Other Equipment | $3,000 – $10,000 |
| Real Property and miscellaneous including rent, security deposit, utilities, insurance and phone | $7,500 – $15,000 |
| Initial Advertising | $5,000 – $10,000 |
| Supplies | $4,400 – $6,500 |
| Other Labor for Store Setup | $4,000 – $8,000 |
| Loan Fees/Interest | $0 – $5,000 |
| Additional Funds | $23,000 – $40,000 |
| Total | $323,000 – $588,000 |
Average Revenue (AUV)
How much revenue can you make with a HobbyTown franchise? A HobbyTown franchised store makes on average $1,297,000 in revenue (AUV) per year.
Here is the extract from the Franchise Disclosure Document:
This compares to $484,000 yearly revenue for similar children retail franchises.
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HobbyTown Franchise Disclosure Document
Frequently Asked Questions
How many HobbyTown locations are there?
As of the latest data, HobbyTown operates over 105 locations across 39 states in the United States. These stores are primarily franchise-owned, with the company maintaining a limited number of corporate-owned locations.
What is the total investment required to open a HobbyTown franchise?
The total investment required to open a HobbyTown franchise ranges from $323,000 to $588,000.
What are the ongoing fees for a HobbyTown franchise?
HobbyTown franchisees are required to pay a royalty fee of 4.75% of gross sales, paid monthly. Additionally, franchisees contribute 2% of their gross sales toward marketing, which includes participation in the National Marketing Program.
What are the financial requirements to become a HobbyTown franchisee?
To become a HobbyTown franchisee, applicants must have a minimum net worth of $500,000 and liquid assets between $150,000 and $200,000. These financial requirements ensure that franchisees have the necessary resources to cover the initial investment and successfully operate the business.
How much can a HobbyTown franchise owner expect to earn?
The average gross sales for a HobbyTown franchise are approximately $1.3 million per location. Assuming a 15% operating profit margin, $1.3 million yearly revenue can result in $195,000 EBITDA annually.
Who owns HobbyTown?
HobbyTown is owned by AMain Hobbies, an online retailer that announced an agreement to acquire HobbyTown in July 2023. This acquisition includes HobbyTown’s headquarters and distribution center in Lincoln, Nebraska, and aims to enhance HobbyTown’s distribution network and product offerings.
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