While some costs like franchise fees, advertising fees and ongoing royalties, are not a surprise, there are others that you may not have considered.
These can include:
Training - most brands include the training, but you may still have to pay for travel, a hotel and food for you and your team.
Technology - some brands have an ongoing cost to use their POS (point of sale) system, proprietary software or scheduling software.
Legal and accounting fees - this is an absolutely necessary cost for contract review and due diligence before signing the franchise agreement.
Grand Opening - some brands require franchisees to invest in an event or promotion for their opening.
Renewal - franchise agreements are for a specific number of years, and most offer a renewal option at the end of the term. In most cases, there is a renewal fee to do this, so you'll want to be sure to have this clarified within the initial contract.
Transferring Ownership - if you want to sell your franchise, there will generally be a fee to do this. Also check the agreement ahead of time to be sure of the rules around selling or transferring the business.
Renovation - Occasionally, franchises overhaul their look, and franchisees may be on the hook for the cost of renovations. Before signing a contract, ask when the most recent brand overhaul happened, and if brand updates requiring renovations are likely to happen in the first few years of your contract.
Always budget about 20-30% extra, just to be safe.