Training cost refers to the fees and expenses associated with the initial and ongoing training programs that franchisors provide to franchisees and their staff. These costs may include tuition, materials, travel, lodging, and wage costs during training. Training cost is typically disclosed in Item 5 or Item 7 of the Franchise Disclosure Document (FDD).
Training cost in franchising is the total expense a franchisee incurs to complete the mandatory training programs offered or required by the franchisor. These programs are designed to ensure the franchisee understands the brand’s operating system, products or services, and standards. Training may include classroom sessions, in-store practice, online courses, and fieldwork. While many franchisors include the cost of the training itself in the initial franchise fee, additional expenses—such as travel, accommodation, meals, wages for staff trainees, or supplemental training—may be borne by the franchisee. The franchise agreement will specify who pays for what, how many people are required to attend, and whether any retraining is mandatory. Franchisors may also charge fees for refresher training, new product rollouts, or training for new managers or ownership transitions.
Additional Definition: The money a franchisee pays for education and instruction. 'Training expenses' may or may not include such items as: travel to and from the training location; room and board during training; the cost of tuition, books and supplies; and on-site startup aid. Practices vary, but training costs may be covered by the franchise fee.
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Franchise systems began formalizing training cost structures in the 1960s and 70s as brand standards and operational systems became more complex. As competition in the franchise space increased, franchisors began offering comprehensive training programs to improve consistency and unit performance. The Federal Trade Commission’s Franchise Rule, which regulates franchise sales, requires that training costs be clearly disclosed in the FDD. Today, training is one of the most valuable components of the franchise package, equipping franchisees with the tools to succeed, while also protecting brand consistency across locations. Franchisors now offer training not just at startup, but also through ongoing support, software updates, and advanced seminars.
Training cost is an essential investment for new franchisees, covering the education and preparation required to operate under the franchisor’s brand. While some training expenses are included in the franchise fee, others—such as travel or extra attendees—are not. Understanding the full scope of training cost is critical for budgeting, planning, and setting realistic expectations as a new franchise owner.