Closets By Design Franchise FDD, Profits & Costs (2025)
Established in 1982 and franchising since 1998, Closets By Design has built a strong reputation in the custom closet and home organization industry.
The company offers a comprehensive range of solutions designed to meet individual client needs, transforming living spaces with a focus on exceptional customer service. Their personalized design consultations ensure that every project aligns with the client’s organizational goals and budget.
Closets By Design takes pride in crafting products in modern, locally operated facilities. These products are known for their superior craftsmanship and are backed by a lifetime warranty, showcasing the brand’s confidence in their durability and quality.
The franchise model stands out for its strong cash flow, high-profit margins, and minimal inventory requirements.
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Initial Investment
How much does it cost to start a Closets By Design franchise? It costs on average between $154,000 – $511,000 to start a Closets By Design franchised outlet.
This includes costs for facility setup, equipment, materials, and initial operating expenses. The exact amount varies based on several factors, such as the size and scope of the operation, the location, and whether the franchisee opts to lease or purchase the property.
| Type of Expenditure | Amount |
|---|---|
| Initial Franchise Fee | $20,000 |
| Territory Fee | Greater of $18,000 or $1,000 per increment of 10,000 households |
| Market Development Fee | Varies |
| Travel/Living Expenses for Initial Training | $2,500 to $3,500 |
| Furniture, Fixtures, and Equipment (including computer) | $37,000 to $254,000 |
| Grand Opening Advertising (1st 3 months) | $30,000 to $45,000 |
| Inventory and Supplies | $10,000 to $25,000 |
| Deposits for Vehicles | $1,000 to $4,000 |
| Interior/Exterior Signs | $500 to $1,000 |
| Licenses and Permits | $500 to $1,500 |
| Rent (excluding Security Deposits) | $2,000 to $12,000 |
| Retail Shop Build-Outs and Improvements | $5,000 to $30,000 |
| Business Insurance | $1,500 to $2,000 |
| Legal/Accounting | $1,000 to $3,000 |
| Additional Funds (1st 3 months) | $25,000 to $75,000 |
| TOTALS | $154,000 to $511,000 |
Average Revenue (AUV)
How much revenue can you make with a Closets By Design franchise? A Closets By Design franchised business makes on average $7,221,000 in revenue (AUV) per year.
Here is the extract from the Franchise Disclosure Document:
This compares to $324,000 yearly revenue for similar furniture franchises. Below are a few Closets By Design competitors as a comparison:
The most profitable franchises to own in 2025
We have compiled the list of the top 400 franchises across 9 industries. Download the report below.
Closets By Design Franchise Disclosure Document
Frequently Asked Questions
How many Closets By Design locations are there?
As of 2024, Closets By Design operates a total of 82 units, consisting of 76 franchised units and 6 company-owned units.
What is the total investment required to open a Closets By Design franchise?
The total investment required to open a Closets By Design franchise ranges from $154,000 to $511,000.
What are the ongoing fees for a Closets By Design franchise?
Closets By Design franchisees pay a royalty fee of 7.25% of monthly gross revenue, with a minimum of $3,000 per month. Additionally, they contribute 2.25% of gross revenue to the National Promotion and Protection Fund for marketing and advertising initiatives.
What are the financial requirements to become a Closets By Design franchisee?
To qualify as a Closets By Design franchisee, candidates should have a minimum net worth of $500,000 and at least $200,000 in liquid capital. The total initial investment ranges from approximately $154,000 to $511,000, which includes the franchise fee and territory fee.
How much can a Closets By Design franchise owner expect to earn?
The average gross sales for a Closets By Design franchise are approximately $7.22 million per location. Assuming a 15% operating profit margin, $7.22 million yearly revenue can result in $1,083,000 EBITDA annually.
Who owns Closets By Design?
Closets By Design is owned by Steve Parmer, who serves as the company’s President and Owner.
Disclaimer
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