Mr. Rooter Plumbing

The franchise fee is $42,500 for a minimum territory covering 100,000 people — but in practice, most territories are larger. The actual fee scales at $425 per additional 1,000 population, and in 2024, the average franchise fee paid was $67,046 (range: $42,955–$180,038). If you want a market of 300,000 people — a reasonable mid-size metro area — you're looking at $42,500 + $85,000 in population fees, or roughly $127,500 in franchise fee alone.

The $1,250 Software System Enrollment Fee brings day-one franchisor payments to $43,750 for a minimum territory. The full item 7 investment range of $122,303–$263,800 covers vehicle, equipment, training, and three months of working capital. Vehicles are the big variable: the cost shown in item 7 ($20,220–$69,300) reflects either rebranding an existing vehicle at the low end or purchasing a new fully outfitted work truck at the high end.

Ongoing, the royalty is 6% of gross sales (called 'License Fee'), with minimum fees that kick in at week 40 based on territory population — ranging from $100/week for the smallest markets to $1,400/week for territories over 2M people. The 2% MAP fee adds to that, along with the mandatory $30,000 first-year local marketing spend. The call center program (Neighborly Service Solutions) is mandatory at $349.99–$449.99/month plus $25 per booked appointment.

ServiceTitan licenses are paid directly to ServiceTitan — budget $131/month per office user and $87/month per service professional user on top of the $76/month technology package.

Mr. Rooter discloses revenue data by percentile — a useful but incomplete picture. In 2024, across 188 franchisees reporting a full 52-week year: the top 10% (18 franchisees) averaged $7.76M in gross sales; the top 25% (47 franchisees) averaged $4.98M; the top 50% (94 franchisees) averaged $3.39M.

The flip side: the bottom 50% averaged $625K (median $575K), and the bottom 10% averaged $131K. That bottom-quartile average of $321K represents operators who are likely running one or two vans in a modest territory. For a plumbing business, $321K gross with 6% royalty ($19K), 2% MAP ($6K), mandatory marketing ($30K+), vehicle costs, labor, and materials would be a breakeven or money-losing proposition.

The top-performing territories exceed $20M — these are multi-territory, multi-van operations with commercial plumbing contracts alongside residential work. The $4.9M average for the top quartile suggests operators running 8–15 vans in a well-penetrated market.

No net income figures are disclosed. At a rough 40% net margin before debt service on a $1M revenue base, that's $400K before servicing franchise fees and loan payments — but margins in plumbing vary dramatically with labor efficiency and ticket mix.

Mr. Rooter has shown steady, modest growth: 212 total units at end of 2022 growing to 232 at end of 2024. The system opened 22 franchised locations in 2024 against zero formal terminations. Three company-owned units have been stable.

The 43-state footprint and 14-unit net gain in 2024 suggest a healthy but mature system that is selectively expanding rather than racing for coverage. Transfer activity (16 transfers in 2024) is a positive indicator — profitable businesses get sold at premiums, not given away. Mr. Rooter is in the middle of the Neighborly portfolio in terms of growth trajectory, sitting between the faster-growing Mr. Handyman and the shrinking Molly Maid.

Territory population fee scaling means your actual entry cost depends heavily on the market you're buying. Signing for a 300,000-person metro at $127,500 in franchise fees alone — before any vehicle, equipment, or working capital — is a materially different investment than the $43,750 headline. Get a precise quote for your specific territory before benchmarking against item 7 totals.

The minimum local marketing spend of $30,000 in year one (or 5% of prior-year gross sales thereafter, whichever is greater) sits on top of the 2% MAP fee. At $600K in gross sales, your mandatory marketing spend is $30,000 alone. Combined with the call center program and Reunion fees, total fee overhead beyond royalty can approach 7–8% of revenue.

Plumbing requires licensing in most states — costs and delays vary dramatically. The FDD explicitly notes this as a significant variable. Some states require a master plumber on staff, which affects hiring strategy and labor cost.

The transfer fee is the greater of $15,000 or 5% of the sales price — meaning if you ever sell a high-revenue territory, the transfer fee can be substantial.

The 0.1-year payback figure in Mr. Rooter's data is an artifact of the $7.76M average from the top-10% cohort being used against the investment — not a realistic figure for typical operators. A more grounded calculation: at $575K median revenue (bottom-half) and a 6% royalty ($34,500), 2% MAP ($11,500), $30K marketing, $5K+ call center, and $3K technology, total annual franchisor-directed costs reach approximately $84,000 — or 14.6% of revenue. Against the $193,000 midpoint investment, the bottom-half operator at $575K with 40% gross margin ($230K) minus $84K in franchise costs = $146K available for labor, vehicle costs, and owner compensation. At rank 27 in Home Services with a health score of 49 and fee burden of 8%, Mr. Rooter's low health score reflects the extremely wide revenue distribution (the bottom 10% at $130K average is economically non-viable) rather than the brand's actual potential. Three operational decisions separate the 4.98M top-quartile operators from the $575K bottom-half: territory population and density (the average franchise fee paid in 2024 was $67,046 — operators paying near the maximum $180,038 fee were buying dense urban territories where 8–15 vans can operate profitably; operators paying the minimum $42,955 are in smaller markets where revenue potential is fundamentally capped), commercial plumbing account development (residential plumbing generates $350–$600 per service call; commercial drain cleaning and maintenance contracts at $5,000–$30,000/month create the revenue base that separates top-quartile from median operators), and multi-license strategy (markets requiring a master plumber on staff create both a barrier and an opportunity — operators who hire a master plumber early and use them as a trainer-manager generate higher average job tickets from a more skilled technician base than operators working without licensed staff).

1. Buyers in smaller markets with populations under 150,000. The bottom 10% of Mr. Rooter operators averaged $130,000 in gross sales — a revenue level that cannot cover the 6% royalty ($7,800), 2% MAP ($2,600), $30,000 local marketing minimum, and vehicle costs simultaneously. Small-market operators at this revenue level are effectively working for the franchisor rather than themselves. The minimum viable territory for sustainable Mr. Rooter economics is likely a market of 200,000+ people with strong residential density.

2. Operators who plan to hire technicians before understanding their state's plumbing licensing requirements. In states requiring a licensed master plumber to sign permits, your hiring plan and compensation structure is constrained by a small pool of licensed professionals. A master plumber who can pull permits earns $80K–$120K in most markets — a fixed cost that changes the unit economics significantly for sub-$500K annual revenue territories. Buyers who don't factor licensing costs into their model will be surprised in year 1.

3. Investors who evaluate Mr. Rooter based on the top-quartile $4.98M average. The top 25% of franchisees are multi-territory, multi-van operations that have been in the system for years. For a first-time buyer in a 200,000-person market with 2 vans, the relevant benchmark is the bottom-half $575K median, not the system average that includes $20M+ mega-operators. The investment thesis for a new Mr. Rooter is a $500K–$1M first-year revenue ramp over 3–5 years, not immediate top-quartile performance.

Mr. Rooter at rank 27 in Home Services and health score 49 ranks in the lower third of tracked brands by health score — which understates the brand's revenue potential by overweighting the wide distribution problem. The $42,500 minimum franchise fee is below Mr. Handyman's $65,000 but the actual paid fee of $67,046 average in 2024 makes it comparable in practice. The 6% royalty is below Mr. Handyman's 7% — a meaningful 1-point difference at $575K revenue equaling $5,750/year. Both brands are Neighborly-owned with identical call center programs ($349–$449/month + $25/appointment) and comparable MAP fees (2%). Mr. Rooter's revenue ceiling — $20M+ for top operators versus Mr. Handyman's ~$3.2M top performance — is substantially higher because plumbing is a licensed trade with higher average job values than handyman services ($400–$800 versus $600–$700). The tradeoff is that plumbing requires licensed technicians that cost more and are harder to hire. For buyers weighing the two brands, Mr. Handyman offers more predictable growth with a narrower revenue range and zero closure rate; Mr. Rooter offers higher revenue upside but a wide distribution and the complexity of managing licensed trades hiring.

1. The average franchise fee paid in 2024 was $67,046 — 58% higher than the $42,500 minimum. For my specific target market, what is the exact population count and resulting franchise fee calculation, and what is the revenue track record of existing operators in comparable-population markets?

2. The minimum weekly royalty for territories over 2 million people is $1,400/week — $72,800/year. At what gross revenue level does the 6% percentage-based royalty exceed this minimum, and are there examples of operators in dense urban territories where the minimum was the binding constraint rather than the percentage rate?

3. The bottom 10% of Mr. Rooter operators averaged $130,000 — a revenue level that can't cover basic franchise costs. What percentage of the system is currently operating below $300,000 in annual gross sales, and what support does Mr. Rooter provide to underperforming operators before reaching the point of termination?

4. Plumbing licensing is a state-specific requirement that the FDD flags as a significant variable. For my specific state, what licensing is required, how long does the application process take, and do I need a licensed master plumber on staff from day one or is there a grace period?

5. The transfer fee is the greater of $15,000 or 5% of the sales price. For a top-quartile operator who has built a $3M+ revenue territory over 10 years, the transfer fee at 5% of sales price could be $100,000–$200,000. Is there a cap on the transfer fee for established operators, and how is the 'sales price' defined — total business value or just the goodwill/customer list component?