Closet Factory^®

Home & Commercial Services • Year: 2025

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What Is Closet Factory?

Closet Factory is a franchise in the Home & Commercial Services category that markets, designs, manufactures, constructs, installs, repairs and services custom closets and storage systems and sells related products under the Closet Factory Marks. The operational model is brick-and-mortar retail outlets, consistent with predecessor operations that currently operate six retail outlets under the franchisor's standards. It serves a mix of customers - builders, residential and commercial clients, and interior decorators (B2C and B2B) - and the core service bundle is the end-to-end provision of custom closets and storage systems (marketing, design, manufacture, construction, installation, repair and related product sales).

Closet Factory Franchise: Pros and Cons

The franchise’s most notable strength is its unusually clean legal and enforcement record - zero disclosed lawsuits, terminations, non‑renewals, franchisee judgments or government penalties - while its biggest risk is the high startup capital required, with Item 7 total investment of $392,500–$663,500 and required assets/reserves of $192,000–$321,000 plus $60,000–$100,000.

Pros

Zero disclosed lawsuits, terminations, non‑renewals, franchisee‑initiated judgments or settlements, government penalties, franchisor enforcement actions, and fraud cases - all standing well below typical for Home & Commercial Services; this clean legal and enforcement record is a clear operational positive and suggests minimal formal disputes within the system.

Managers are not required to hold equity (bottom 5%), giving you flexibility to structure manager ownership and compensation as you see fit - that makes hiring and incentive design simpler for an operator.

Training costs are listed at $0, well below typical for Home & Commercial Services, removing an upfront training expense and lowering your initial cash outlay compared with peers.

Cons

The Item 7 total investment range is high: a minimum of $392,500 and a maximum of $663,500, both well above typical for Home & Commercial Services - this substantially raises the upfront capital and likely financing you'll need to open.

Item 7 assets and reserves are elevated: required assets range from $192,000 to $321,000 and minimum reserves are $60,000 (up to $100,000), all well above typical for the industry - expect larger equipment/infrastructure costs and the need to hold significantly more cash on hand for ongoing monthly operations.

Lawsuits & Legal Risk

100

Excellent

Closet Factory reported no material legal proceedings,

Territory Protection

43/100

NORMAL

Closet Factory grants a non‑exclusive, site‑specific Territory defined by geographic and demographic factors (protected) for a single Traditional Closet Factory Outlet. Territory rights are contingent on meeting performance quotas; the franchisor retains the right to sell via e‑commerce/alternative channels, assign leads, and develop additional units without offering first refusal.

Training & Support

53/100

NORMAL

Closet Factory provides a robust 86-hour training curriculum designed to prepare two franchisee-designated staff members for operational launch. The program includes on-site launch support for operational readiness, with travel and living expenses borne by the franchisee and certain on-site assistance subject to additional fees.

Unit Growth Analysis

Closet Factory is now a 92‑unit system, accelerating at about 9.5% year‑over‑year - growth that’s clearly franchise-driven rather than corporate consolidation. For a new owner this signals validated demand and still-accessible territories, but this pace likely strains the franchisor’s training, lead generation and field-support capacity, so verify onboarding resources, marketing lead flow and protected-territory enforcement before committing.

How Much Does It Cost to Open a Closet Factory Franchise?

Opening a Closet Factory franchise requires a total initial investment of $392,500 to $663,500, according to the 2025 Franchise Disclosure Document. This range covers the franchise fee, real estate, equipment, training, and initial working capital needed to launch and operate through the early months.

Minimum Investment

$392,500

Franchise Fee

Real Estate

Equipment & Assets

Reserves

Training

Other

Maximum Investment

$663,500

Minimum Investment Breakdown

Franchise Fee$58,500

Real Estate$0

Equipment & Assets$192,000

Reserves$60,000

Training$0

Other$82,000

Maximum Investment Breakdown

Franchise Fee$58,500

Real Estate$0

Equipment & Assets$321,000

Reserves$100,000

Training$0

Other$184,000

Investment Analysis

This investment analysis is coming soon. Have ideas for other analyses you'd like us to add? Get in touch.

The initial investment amounts shown are estimates only. Actual costs may vary based on location size, business model, and multi-unit ownership arrangements. We recommend reviewing the full Franchise Disclosure Document for complete details.

How Much Do Closet Factory Franchise Owners Make?

Closet Factory franchise locations reported average gross sales of $6,097,058 and median gross sales of $4,618,860 in 2025, based on financial performance data disclosed in Item 19 of the Franchise Disclosure Document.

Average Gross Sales:

$6,097,058

Median Gross Sales:

$4,618,860

High Gross Sales:

$39,149,176

Low Gross Sales:

$350,963

Sample Size:

Percent Attaining Average:

100.0%

Audit Status:

Unaudited

Franchise vs Corporate Performance: Aggregate and central tendency (2024): Total gross sales across the 47 franchised Closet Factory businesses = $286,561,735, which produces an arithmetic average of $6,097,058 and a median of $4,618,860. The average exceeds the median, indicating right-skewed distribution driven by a small number of very large territories (top = $39,149,176). According to the disclosure, all 47 franchised businesses (100%) had annual gross sales above the annual Average Gross Sales figure reported in 2024 Table 1 (this is stated in the notes). The Item 19 disclosure reports gross sales only (top-line) - no cost of goods sold or operating expense detail is included, so profitability (net income) is not reported in Item 19.

Performance Variability Analysis: Quartile-level variability (2024): First quartile (top 12 territories) dominates sales: total $162,811,851, average per territory $13,567,654, median $9,989,100. Second quartile total $70,308,148 (avg $5,859,012, median $5,932,479). Third quartile total $39,747,088 (avg $3,312,257, median $3,289,441). Fourth quartile total $13,694,649 (avg $1,244,968, median $1,363,713). Sales-per-opportunity (Table 4) show narrower spread: average sales per opportunity by quartile are $4,946 / $3,956 / $3,730 / $3,575 (Q1→Q4) and median sales per opportunity $4,640 / $3,961 / $3,913 / $3,978, showing sales-per-opportunity less dispersed than total annual gross sales. Range and skew: highest single territory is $39,149,176 vs lowest $350,963 - a high/low ratio ≈ 111.6x, confirming very large dispersion in annual gross sales across territories. Quartile-level percent above quartile averages (from notes): Q1: 3 of 12 (25%) above Q1 average; Q2: 6 of 12 (50%); Q3: 5 of 12 (42%); Q4: 6 of 11 (50%).

Data Scope and Limitations: Source limitations and caution (2024): The Item 19 figures are unaudited historical gross sales reported by franchisees and exclude costs (COGS, operating expenses, taxes, etc.), so they do not represent net income or profitability. The sample is limited to franchised Closet Factory businesses open more than one year as of December 31, 2024 (47 businesses) and excludes non‑franchised company operations. Some territory numbers represent multiple purchased territories (i.e., single franchisee operations may aggregate multiple territories), which affects per-territory comparisons. The franchisor states it will provide written substantiation on request. Because expense and profit data are not provided, any assessment of margin or cash‑flow performance requires independent investigation or review of individual outlet records.

Frequently Asked Questions

Is Closet Factory a good franchise to own?

Whether Closet Factory is a good franchise depends on your goals, experience, and local market. Key factors from the 2025 FDD: Closet Factory operates 92 locations, received a legal risk score of 100/100, a training and support score of 53/100. Financial performance data is disclosed in Item 19. Prospective franchisees should review the full Franchise Disclosure Document and consult with a franchise attorney before making any investment decision.

Is a Closet Factory franchise worth the investment?

The value of a Closet Factory franchise investment depends on factors such as location, operator experience, and market demand. The initial investment ranges from $392,500 to $663,500. Closet Factory disclosed average gross sales of $6,097,058 in 2025. Franchise investments carry inherent risk, and prospective buyers should conduct thorough due diligence before committing capital.

How long does it take to break even with a Closet Factory franchise?

Break-even timelines for Closet Factory franchises are not disclosed in the 2025 Franchise Disclosure Document. Break-even periods vary significantly based on initial investment level, local market conditions, operating costs, and revenue ramp-up speed. Prospective franchisees should build a pro forma financial model using Item 7 cost estimates and, where available, Item 19 financial performance data from the FDD.

Is Closet Factory a franchise or a corporate-owned business?

As of the 2025 FDD, Closet Factory operates 86 franchised locations and 6 company-owned locations. Franchise opportunities are available through the franchisor's disclosure process.

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