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How profitable is The UPS store? How much will it cost to open?

Updated: May 31



How profitable is

The UPS store?

How much will it cost to open?


Can The UPS Store franchise be a profitable business venture?


Are you looking to invest in a franchise and wondering if opening a UPS Store is worth it? If so, then you’re in the right place! A UPS Store franchise can be an incredibly profitable business venture. However, it’s important to understand the costs associated with opening one up.







Let’s dive into the details and explore just how profitable a

UPS Store franchise can be.


The UPS store is not an absentee franchise. Owning a UPS Store comes with many advantages compared to owning other types of businesses. For instance, you don’t need any previous experience in running a business since all staff members will be trained by UPS beforehand. Additionally, you benefit from established brand recognition which means customers already trust your service before they even try it out! Finally, you get access to networks of other successful businesses in similar industries which can help you grow your own success even further down the line.




The payoffs of owning a UPS store franchise


The payoffs of owning a UPS store franchise can be decent to great, depending upon how many franchise units you own. With this type of model, it is best to own at least three to five units to achieve a worthy annual net and high business valuation.


But it is important to remember that not all stores are profitable. To be successful, a UPS Store franchise requires a suitable site and efficient management.


Does the franchisor provide any financial assistance to franchisees?

Yes, the franchisor does provide financial resources to franchisees in various forms such as financing for initial equipment costs, equipment lease financing, and loans for multiple center owners. The franchisor participates in the IFA's VetFran program. Military veterans may qualify to receive $15,000 off the franchise fee. It's important to note that the franchisor has the right to modify or discontinue any financing programs at their discretion.


How long is the initial franchise term, and how can it be renewed?

The initial franchise term is 10 years. Franchisees have the option to renew for successive periods of 10 years each as long as they are in good standing. The renewal is subject to the then-current version of the Franchise Agreement during each renewal period.


What are the estimated initial investment costs for opening a UPS Store franchise?


The average cost to open a UPS store is around $350,000.


The minimum investment amount required to open a The UPS Store franchise is $138,433. It can go all the way up to $470,031.

The average adjusted gross sales for a UPS Store in 2020 was $607,750 according to their 2021 Item 19.





The estimated initial investment costs for opening a UPS Store franchise can vary depending on several factors. The range of estimated costs includes fees such as the initial franchise fee, marketing plan fee, design fee, site survey, center development fee, initial training fees, travel and living expenses during training, site rent and security deposit, leasehold improvements, construction costs, signage, furniture, and decor items. Additionally, costs may include expenses for computer hardware, installation, and freight, digital media, optional keyless entry, annual technology development and support fees, software, printer lease, other equipment, start-up supplies, utility deposits, insurance, and additional funds for a 3-month period.


The total estimated initial investment for opening a UPS Store franchise typically falls within a range, covering various types of centers from rural programs to regular franchises. The estimated range provided encompasses the investment needed for new traditional centers, with details available in the Franchise Disclosure Document (FDD). It is important to note that non-traditional center investment costs are addressed separately in a different FDD.


How long is the initial franchise term, and how can it be renewed?


The initial franchise term is 10 years. Franchisees have the option to renew for successive periods of 10 years each as long as they are in good standing. The renewal is subject to the then-current version of the Franchise Agreement during each renewal period.

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How much does a UPS Store franchise owner make?

Based upon the numbers above, a The UPS Store franchise owner can expect to make a profit of only around $60,000 - $120,000


Questionable Profitability –


According to a very reliable source, it takes "about $365,000 in annual gross sales" to produce a modest "$35,000/yr income for the owner" and

"about 60% of all US stores do not break even."


What are the estimated initial investment costs for opening a UPS Store franchise?


The estimated initial investment costs for opening a UPS Store franchise can vary depending on several factors. The range of estimated costs includes fees such as the initial franchise fee, marketing plan fee, design fee, site survey, center development fee, initial training fees, travel and living expenses during training, site rent and security deposit, leasehold improvements, construction costs, signage, furniture, and decor items. Additionally, costs may include expenses for computer hardware, installation, and freight, digital media, optional keyless entry, annual technology development and support fees, software, printer lease, other equipment, start-up supplies, utility deposits, insurance, and additional funds for a 3-month period. The total estimated initial investment for opening a UPS Store franchise typically falls within a range, covering various types of centers from rural programs to regular franchises. The estimated range provided encompasses the investment needed for new traditional centers, with details available in the Franchise Disclosure Document (FDD). It is important to note that non-traditional center investment costs are addressed separately in a different FDD.



 

The average cost to open a UPS store is around $350,000.


The minimum investment amount required to open a The UPS Store franchise is $138,433. It can go all the way up to $470,031.

The average adjusted gross sales for a UPS Store in 2020 was $607,750 according to their 2021 Item 19.

Net profit between $60,000 - $120,000 and 3-5 years to recoup investment.


We dive the UPS Store franchise a D grade in terms of investment/return ratio.


 




 


Advantages of a UPS Store Franchise


When you own a UPS Store franchise, you are essentially in the business of retail shipping. This means that your customers will be both individuals and businesses.


The UPS Store offers a wide variety of services that your customers can take advantage of, such as:


- Printing

- Packing and shipping

- Mailbox services

- Notary services

- Freight services

- Marketing and design services


You can expect your customers to use your services for both personal and business purposes. This provides you with a great opportunity to build relationships with your customers and become a trusted resource for them.


What are the obligations and restrictions for UPS Store franchisees?


UPS Store franchisees are required to appoint a primary operator who will be responsible for the day-to-day supervision of center operations. This primary operator must undergo specific training programs provided by the franchisor, including new franchisee training and financial management training. Additionally, a full-time employee must attend and successfully complete the print services training program. The franchisees are obligated to use the premises solely for the operation of the center and maintain regular hours of operation as specified by the franchisor. They are prohibited from using the premises for any other purposes without written consent from the franchisor. The operations of the center must adhere strictly to the methods, standards, and specifications outlined by the franchisor in the operations manual or other written guidelines.


What are the training requirements for UPS Store franchisees?


The training requirements for UPS Store franchisees include participating in various training programs offered by the franchisor. These programs are designed to enhance business management, technical, conceptual, and diagnostic skills essential for operating a successful franchise business. Franchisees are expected to complete an introductory web-based training followed by a multi-phased The UPS Store Franchisee Training Program. This program consists of two main parts: the In Store Experience Parts I and II, consisting of five days each at a local/regional Certified Training Center, and the University Business Course, an eight-day program held in San Diego at The UPS Store University. In addition, the designated primary operator must attend and successfully complete a Financial Management Training Program provided by an approved vendor within six months of the effective date of the Franchise Agreement. Franchisees and their supervisory employees may also be required to participate in periodic supplemental or refresher training programs as determined by the franchisor.


When did the UPS Store business begin and start franchising?


The UPS Store business was established and commenced operations in the year 1980. At the same time, the UPS Store initiated its franchising opportunities, allowing other individuals or entities to own and operate UPS Store locations under the franchise model since 1980.





As a UPS Store franchise owner, you will have the support of the UPS brand behind you. This can be a great advantage when it comes to attracting customers and building your business.

The UPS Store franchise offers a proven business model that can be profitable for the right owner. If you are looking for an opportunity to be your own boss and build a business with potential for growth, a UPS Store offers nice advantages with the right unit strategy.


UPS Store Franchise Costs


Opening a UPS Store franchise will cost you between $138,433 and $470,031. These costs include the initial franchise fee of $29,000 as well as other startup costs such as equipment, signage, leasehold improvements, and working capital.


You will also need to pay a monthly royalty fee of 5%, which is based on your gross sales.

The UPS Store has a franchise term of 10 years, with the option to renew for an additional 10 years.


Is a UPS Store Franchise a Good Investment?


If you are looking for a business opportunity with potential for growth and profitability, a UPS Store franchise can be a good investment. The key to success with this franchise is to choose a good location and manage your business efficiently.


With the right strategy in place, a UPS Store franchise can be a profitable addition to your portfolio.


The UPS Store Average sales / revenue per year

  • Total Investment: $350,000

  • The UPS Store Owner's profit per year: Approximately: $100,000

  • Estimated time to profitability/ROI: 3.5 - 4 years

  • Number of UPS Stores in the US: 4,326 (as of December 2020)

  • UPS Store Franchise Cost: $138,433 - $470,031 Franchise Fee: $29,000

  • UPS Store Franchise Term: 10 years, renewable

  • Monthly Royalty Fee: 5% of gross sales

Financial requirements and fees

  • UPS Store Franchise Requirements: You must have a net worth of at least $350,000 and liquid assets of at least $100,000 to qualify for a UPS Store franchise. You will also need to have prior business experience and be able to pass a background check.

  • Monthly Royalty Fee: 5% of gross sales

  • Marketing Fee: 2.5% of gross sales


Learn how The UPS Store franchise owners compare to a gym franchise owner salary.

Are The UPS Store top earning franchises amongst the most lucrative franchise?

Is the postal and business services franchise segment growing?

Learn if a The UPS Store business services franchise is worth it as you explore the ups store network.

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Learn the franchises that cost much less than

The UPS Store and can make you MUCH MORE!

Click Here to learn more.



 

When you "buy" a Chick-fil-A franchise

you are buying yourself a job.

You don't own it. They do.




Advantages of a The UPS Store Franchise


Instant brand recognition and trust from businesses and consumers alike.

Wide variety of services that your customers can take advantage of, such as:


- Printing

- Packing and shipping

- Mailbox services

- Notary services

- Freight services

- Marketing and design services


You can expect your customers to use your services for both personal and business purposes. This provides you with a great opportunity for multiple revenue streams and repeat, high value customers you can depend on for steady revenue.


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Want more ups franchise info? Want to know who their diverse suppliers and company's profile is and how it affects suppliers, diversity reflect on the investment?


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How much does a UPS Store franchise owner make?


The UPS Store Owner's average profit per year is approximately $100,000. It takes "about $365,000 in annual gross sales" to produce a modest "$35,000/yr income for the owner" and "about 60% of all US stores do not break even."


 


Is The UPS Store a good investment?


The UPS Store offers a proven business model that can be profitable for the right owner. If you are looking for an opportunity to be your own boss and build a business with potential for growth, a UPS Store offers nice advantages with the right unit strategy.

We recommend 3 -5 units for a properly capitalized investor.

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