Miracle-Ear Franchise Sales, Costs & Profits (2023)
This article was updated with the 2023 Franchise Disclosure Document
With more than 1,300 franchised stores across the US, Miracle-Ear is undeniably the hearing aids leader on the market today. If you’re looking for a recession-proof franchise, this might be it. Indeed, this market has strong growth fundamentals (e.g. ageing population).
But what about the financials? Is opening a Miracle-Ear franchise a good investment?
On average, it would cost you $236,000 to open a new store. The same store would make on average $414,000 in net sales per year, is this profitable?
In this article we’re looking at Miracle-Ear and its Franchise Disclosure Document to find out how much the franchise (really) costs, and how profitable it really is.
Key stats
| Franchise fee | $30,000 |
| Royalty fee | $48.80 per ear aid |
| Marketing fee | 10.0% |
| Investment (mid-point) | $236,000 |
| Average sales | $414,000 |
| Sales to investment ratio | 1.8x |
| Payback period | 6 years |
| Minimum net worth | $75,000 |
| Minimum liquid capital | $25,000 |
Miracle-Ear Franchise Business Plan
All the stats: startup costs, profits, breakeven, etc.
5-year financial projections built with the FDD
Excellent 4.8/5 based on 70 reviews
About Miracle-Ear
Miracle-Ear is a chain of hearing aid retail outlets based in Minneapolis, Minnesota. It is a subsidiary of the giant worldwide distributor of hearing aids, Amplifon, based in Italy.
Miracle-Ear offers various hearing aids, such as behind-the-ear (BTE), in-the-ear (ITE) and receiver-in-the-canal (RIC), depending on the extent of hearing loss.
The company was founded in 1948 by Kenneth Dahlberg. Over the years, Miracle-Ear has evolved, growing with technology and time, producing magnificent hearing aids and changing the lives of millions of customers.
Miracle-Ear began franchising in 1983 and by 2021, the brand had opened 1,323 franchises in the US and 193 company-owned locations.
Today, Miracle-Ear is a leading hearing aid provider in the US, offering lasting solutions to millions of people with hearing loss and positioning itself as a lucrative franchise option. It embraces technology to offer free hearing and lifestyle tests and consultations, expert hearing solutions for every lifestyle & budget and its hearing aids come with free lifetime service & aftercare.
Miracle-Ear franchise pros and cons
The Pros:
- Exclusive territory protection: Miracle-Ear offers its franchisees an exclusive territory to operate in, as defined in their franchise agreement. It does not authorize any other franchise or operate a competing business in the protected area.
- Financial assistance: The brand offers its franchisees in-house financing to cover accounts receivable costs. In addition, it has relationships with third-party lenders to fund qualified franchisees for their startup costs, franchise fees and ongoing costs.
- Pre-opening training and support: The franchisor provides its franchisees with 34 hours of classroom and ongoing training to help them learn the basics of the company and manage their stores. In addition, it trains them on launching its outlets and continues to offer periodic performance reviews and sales training.
- Marketing and branding: Miracle-Ear has dedicated marketing and advertising strategies to help franchisees create awareness of their outlets and boost profitability. Franchisees can leverage strong brand popularity, ad templates, email marketing, regional advertising and targeted promotional campaigns to reach a wide target market.
- Site selection: The franchisor provides its franchisees with site selection guidance to identify a suitable outlet location.
The Cons:
- Not a passive investment opportunity: The franchise does not present a semi-absentee ownership opportunity. Franchisees must be fully active in the day-to-day operations and management of their outlets.
- Not a home-based business: A Miracle-Ear franchise cannot be run from home or from a mobile unit. Franchisees must have an office space, retail facility or warehouse to operate from.
- Not a part-time business: The franchise must be open full-time as per the parent company’s operating hours.
Miracle-Ear franchise costs
You would have to invest an average of $236,000 to open a Miracle-Ear franchise.
The investment covers all the start-up costs you may need to open a Miracle-Ear franchise business. You must pay the franchisor an initial franchise fee of $30,000. In addition to this franchise fee, the investment also covers:
- Formulation costs: prepaid expense-franchise, prepaid expense-location, real property build-out costs, signage, and more.
- Equipment: furniture, fixtures, and equipment
- Operating costs: inventory, travel and living expenses, additional funds for 3 months, and more.
Startup costs
Here’s the full breakdown of costs:
| Type of Expenditure | Amount |
|---|---|
| Initial franchise fee | $30,000 |
| Formulation costs | $23,000 – $167,500 |
| Equipment | $30,000 – $60,000 |
| Operating costs | $36,500 – $95,000 |
| Total | $119,500 – $352,500 |
Miracle-Ear Franchise Business Plan
All the stats: startup costs, profits, breakeven, etc.
5-year financial projections built with the FDD
Excellent 4.8/5 based on 70 reviews
Miracle-Ear franchise fees
The initial franchise fee for a Miracle-Ear franchise is $30,000
In addition to the initial franchise fee, you must pay to the franchisor a royalty fee of $48.80 per ear aid of revenues, as well as a variable marketing fee of 10.0% of revenues.
Miracle-Ear franchise revenue
On average, a Miracle-Ear franchise makes $414,000 in sales per year. This number represents the average sales per franchise business for 1,050 out of the 1,275 franchised businesses that operated in all of 2022.
Is Miracle-Ear a good franchise investment?
Assuming a 10% net profit margin, the average payback for opening a Miracle-Ear franchise is 5 to 6 years, which is excellent.
This means that, on average, you would repay investors and the bank (if you took a loan) within 5 to 6 years post opening, by using the profits generated by the business.
Miracle-Ear Franchise Business Plan
All the stats: startup costs, profits, breakeven, etc.
5-year financial projections built with the FDD
Excellent 4.8/5 based on 70 reviews
Disclaimer
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