Patrice & Associates Franchise Review (2026): Costs, Fees, Revenue Potential

• Category: Food & Beverage
• Initial Investment: $105,100 to $121,050
• Franchise Fee: $65,000
• Royalty: 10% of Gross Sales
• Marketing / Ad Fee: 2% Brand Fund Fee
• Key additional recurring fees: 7% P&A Database Fee; 5% Billing Services Fee; technology fee noted at $500 monthly; recruiter setup $125 each plus $60 monthly per recruiter
• Number of locations: 189 franchised outlets at year-end 2024; 0 company-owned
• Best Fit: Active owner or manager-led operation with active oversight

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The disclosure estimates initial investment for a single territory at $105,100 to $121,050, with an initial franchise fee of $65,000. Based on the range provided, the franchise fee is the largest identifiable upfront cost driver.

Other startup funding includes additional funds of $4,000 to $6,000. The disclosure also references a starter kit of marketing materials, and the business appears to rely on technology and database access rather than heavy physical buildout.

On a relative basis, this appears to be a low-cost franchise startup compared with concepts that require real estate development or major equipment purchases. That said, the lower entry cost is offset by a meaningful ongoing percentage-based fee structure.

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Key recurring fees disclosed include:

• Royalty Fee: 10% of Gross Sales
• Brand Fund Fee: 2% of Gross Sales
• P&A Database Fee: 7% of Gross Sales
• Billing Services Fee: 5% of Gross Sales
• Technology Fee: $500 per month noted in the disclosure
• Recruiter Setup & Licensing: $125 initial fee per recruiter plus $60 per month per recruiter
• Conference Registration: $495 per person per conference
• Training Fee for New Recruiters: $500 if franchisor provides training
• Training Fee for New Manager: $3,500 if a manager is hired

The overall burden is notable because several percentage-based fees apply to Gross Sales, and some staffing-related fees scale as recruiters are added. This structure may keep fixed startup costs lower, but it can materially affect the economics of each dollar of revenue.

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The FDD includes an Item 19, but it does not provide standard unit-level outlet revenue, profit, margin, or EBITDA figures. Instead, it provides placement-fee data for 2024.

Disclosed Item 19 numbers

For the measuring period January 1, 2024 through December 31, 2024:

• Franchised outlets in operation at year-end: 189
• Qualifying outlets included in the representation: 100
• Excluded outlets: 89, because they did not make at least one placement during the measuring period and therefore had no operations
• Company-owned outlets included: 0

Placement-fee data disclosed

All Placement Fees

• Combined total placement fees: $5,070,505
• Total placements: 501
• Average placement fee: $10,121
• Median placement fee: $7,920
• Range: $2,000 to $97,500
• Number and percent at or above average: 174 of 501 placements (35%)

Executive Search Placement Fees

• Combined total placement fees: $1,984,254
• Total placements: 84
• Average placement fee: $23,622
• Median placement fee: $19,500
• Range: $15,000 to $97,500
• Number and percent at or above average: 25 of 84 placements (30%)

Interpretation

These figures show that placement values vary widely, especially in executive search. The median placement fee is below the average in both categories, which suggests that a smaller number of larger placements pull the average upward.

Just as important, the representation is based on placements, not outlet-level annual sales per franchise. The disclosure does not clearly establish average or median annual revenue per outlet from this table alone. It also states that the figures are based on actual placement fees for hires without deductions for fees, costs, or expenses.

That means revenue is not profit, and the Item 19 does not show whether franchisees earned positive operating income after royalties, database fees, billing fees, brand fund contributions, payroll, or other expenses. The disclosure also does not clearly state that these figures were audited.

Because only 100 of 189 outlets qualified for inclusion, the sample excludes a substantial portion of the system.

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• Primary model: B2B
• Revenue pattern: Transaction-based placement fees rather than recurring subscription-style revenue
• Operational characteristics: Office-based recruiting business with significant use of proprietary database and technology; weekly reporting and fee remittance; staffing can expand through recruiters and possibly a manager

The disclosure indicates that a Managing Owner must be designated and must devote full-time efforts to the business unless a manager is hired. This points to an operation that is not purely passive.

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Advantages

• Initial investment is relatively modest at $105,100 to $121,050.
• The system is established in size, with 189 franchised outlets at year-end 2024.
• No company-owned outlets means the disclosed system is entirely franchised.
• The business appears less dependent on physical buildout than location-heavy concepts.

Considerations

• The recurring fee stack is heavy: 10% royalty + 2% brand fund + 7% database fee + 5% billing services fee, plus other charges.
• Item 19 does not provide unit-level profit or outlet revenue averages, only placement-fee activity.
• 89 of 189 outlets were excluded from the Item 19 qualifying group because they did not make at least one placement during the measuring period.
• Territory protection is non-exclusive, which can limit geographic protection.
• The operating model appears to require meaningful owner involvement or active management rather than passive ownership.

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This franchise may fit someone comfortable with a service-based, recruiting-oriented business that depends on business development, candidate placement activity, and ongoing management of recruiters or a manager.

It likely does not fit someone seeking a passive investment, exclusive territory protection, or a model with clearly disclosed unit-level revenue and profit benchmarks.

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• The franchisor can require disputes to take place in Maricopa County, Arizona, subject to state law.
• Monetary defaults reportedly have a 10-day cure period, which is relatively short operationally.
• The disclosure references litigation mentions.
• The franchisor handles client invoicing and collections, and franchisees may not directly invoice clients or collect payment without prior written consent.
• Access to the P&A Database may be denied if noncompliance fees are unpaid and issues remain uncured.

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Patrice & Associates presents a lower upfront investment than many physical-location franchises, but it offsets that with a layered ongoing fee structure and an operating model that appears to require active management. The main tradeoff is straightforward: lower startup cost and a service-based model versus limited unit-level earnings disclosure, non-exclusive territory, and meaningful recurring fees tied to Gross Sales.

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