HobbyTown®/HobbyTown USA® Franchise
Cost, fees, owner earnings, closure rate and litigation for a HobbyTown®/HobbyTown USA® franchise — pulled from the franchisor's own public FDD (2023), not its sales material.
Disclosure honesty
HobbyTown®/HobbyTown USA® discloses earnings (Item 19) — but the grade is how honestly. We graded it C.
What their own earnings claim actually says
67 of 85 stores reported 2025 performance. Average gross revenue $1,627,084; adjusted operating income $85,825. Quartile data shows wide variation; lowest quartile negative. Cherry-picking: excluded 18 non-reporting stores and 9 closures.
What a HobbyTown®/HobbyTown USA® franchise actually costs to run
| Fee | Disclosed | Where it comes from |
|---|---|---|
| Initial franchise fee | $49,500 | Item 5 — paid up front, before you open |
| Royalty | 4.75% of gross sales | Item 6 — charged on revenue, not profit |
| Advertising fund | 2% of gross sales | Item 6 — brand marketing, spent at the franchisor's discretion |
| Total recurring fees | 6.75% of gross sales | Before rent, labor, food or debt service |
| Total initial investment | $327,100 – $458,000 | Item 7 — franchisor's own low/high estimate |
4.75% royalty + 2% advertising fee. Handling fees 2-20% on warehouse shipments. Transfer fee $10,000 third-party; $5,000 existing franchisee.
Royalty and ad-fund percentages are charged on gross sales — an owner pays them whether or not the location is profitable.
HobbyTown®/HobbyTown USA® system size and owner turnover
| Total outlets | 85 |
| Ceased operations | 7 |
| Terminated by franchisor | 2 |
| Transferred to new owners | 0 |
| Closure rate | 8.2% of outlets |
9 closures in 2025; 21 outlets lost 2023-2025. Negative income in 4th quartile ($83,687 average).
From Item 20 of the FDD 2023. Terminations and ceased operations are the franchisor's own count of owners who stopped — the number the sales pitch leaves out.
Is HobbyTown®/HobbyTown USA® worth it? — how it compares to 59 similar franchises
| Ongoing fees | 6.75% of sales | about average |
| Startup cost | from $327,100 | pricier than 84% of peers |
| Disclosure honesty | Grade C | typical for the category |
| Closure rate | 8.2% of outlets | worse than 73% of peers |
| Disclosed lawsuits | 0 | fewer than most |
Benchmarked against every retail & business services franchise we've graded from public FDDs — the context the franchisor's pitch never gives you.
Owner take-home for a HobbyTown®/HobbyTown USA®
The franchisor's framing: 67 of 85 stores reported 2025 performance. Average gross revenue $1,627,084; adjusted oper… We reconstruct what an owner actually keeps, from their own FDD.
- Reconstructed owner P&L — net take-home after royalty, ad fund, rent, labor & debt
- Break-even timeline + cash-on-cash ROI
- Full fee stack + required-purchase markups
- Decoded real failure / closure rate
- How it ranks vs comparable franchises
- Validation-call playbook — the exact questions to ask
See a full sample report → · 30-day guarantee
HobbyTown®/HobbyTown USA® franchise — frequently asked
- How much does a HobbyTown®/HobbyTown USA® franchise cost?
- The FDD lists a total initial investment of about $327,100–$458,000, including a $49,500 initial franchise fee.
- How much do HobbyTown®/HobbyTown USA® franchise owners make?
- 67 of 85 stores reported 2025 performance. Average gross revenue $1,627,084; adjusted operating income $85,825. Quartile data shows wide variation; lowest quartile negative. Cherry-picking: excluded 18 non-reporting stores and 9 closures. We grade this disclosure C for honesty.
- What are the HobbyTown®/HobbyTown USA® franchise fees?
- HobbyTown®/HobbyTown USA®'s FDD discloses a $49,500 initial franchise fee, a 4.75% royalty on gross sales, a 2% advertising-fund contribution, for roughly 6.75% of gross sales in recurring fees before rent, labor, or debt service. 4.75% royalty + 2% advertising fee. Handling fees 2-20% on warehouse shipments. Transfer fee $10,000 third-party; $5,000 existing franchisee.
- What is the HobbyTown®/HobbyTown USA® franchise profit margin?
- HobbyTown®/HobbyTown USA® does not publish a franchisee net-profit margin — almost no franchisor does. What Item 19 actually shows: 67 of 85 stores reported 2025 performance. Average gross revenue $1,627,084; adjusted operating income $85,825. Quartile data shows wide variation; lowest quartile negative. Cherry-picking: excluded 18 non-reporting stores and 9 closures. Recurring fees alone take about 6.75% of gross sales, before rent, labor, food or debt service. Margin has to be reconstructed from the disclosure, not read off it.
- What is the HobbyTown®/HobbyTown USA® franchise failure rate?
- 9 closures in 2025; 21 outlets lost 2023-2025. Negative income in 4th quartile ($83,687 average).
- How many HobbyTown®/HobbyTown USA® locations are there?
- HobbyTown®/HobbyTown USA®'s FDD reports 85 total outlets, with 7 that ceased operations in the most recent reporting year and 0 transferred to new owners. Item 20 is where system health shows up before the marketing does.
- Does HobbyTown®/HobbyTown USA® have complaints or lawsuits?
- HobbyTown®/HobbyTown USA® discloses no material litigation in Item 3 of the filing we reviewed. That's a positive signal, though it covers only what the franchisor is required to report.
- Is a HobbyTown®/HobbyTown USA® franchise worth it?
- It depends on the numbers, not the pitch. HobbyTown®/HobbyTown USA® scores C on disclosure honesty, carries about 6.75% of sales in ongoing fees. Get the real owner take-home before you sign.
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Source: WI DFI Franchise Registration (2023). FranchiseValidate is independent and not affiliated with HobbyTown®/HobbyTown USA® or its franchisor. Figures are extracted from the franchisor's own public disclosure document; verify against the current FDD before any decision.