Are you looking to own a Joint Chiropractic franchise? The company is probably one of the fastest-growing medical & healthcare franchises in the United States. They grew over 3 times in the past 5 to 8 years, and they own hundreds of locations across the country.
But is The Joint Chiropractic Franchise really a good idea? Should you buy one? In this article, we will be looking at the Joint Chiropractic’s business, franchise system, expected costs and revenue, and all other crucial details.
About The Joint Chiropractic And The Joint Chiropractic History
The Joint Chiropractic is a chain of chiropractic clinics based in Arizona. The company was founded in 1999 with the aim to make chiropractic convenient, accessible, and affordable instead of the misunderstood traditional concept. They provide chiropractic services and products in their clinics.
They started to franchise in 2003, and now they have over 850 clinics across the United States. 720 of these locations are franchised, and the rest are company-owned. The brand has a massive reputation in the industry, and they are probably one of the biggest chiropractic franchise clinics in the United States.
Franchise Model Table
| Cost Or Fees | Amount |
|---|---|
| Initial Investment | $215,297-$478,997 |
| Franchise | YES |
| Franchising Since | 2003 |
| Franchise-Fee | $39,900 |
| Royalty-Fee | 7% |
| Liquidity | $100,000 |
| Estimated Outlets | 850+ |
How Much Does It Cost To Open A Joint Chiropractic Franchise?
The cost to open a Joint Chiropractic franchise varies between $215,297 and $478,997. This is the number projected and detailed in the franchise disclosure document of the company given to the franchisees. It includes everything from the $39,900 franchise fee to the equipment, payroll, lease, and other startup costs.
Depending on several factors, such as the location and size of the store, the real numbers might be different than the projected investment.
Franchise Requirements Of The Joint Chiropractic
The potential franchisees must have a net worth of at least $350,000 and at least $100,000 in liquid capital. The franchisee also needs to have a good credit history and score.
For the professional side, you do not need to be a chiropractor or have experience in the industry. The majority of the franchisees in the brand do not have experience in the field or as a manager. The company’s extensive training program aims to teach you everything from the beginning.
The Joint Chiropractic: Profit & Revenue
According to the latest reports published by the company in September 2023, they had $29.47 million in annual revenue. This is a 10% increase from the previous report in June. However, when all expenses were removed, the company didn’t make any net profit. They had a net loss of $716 billion.
Overall Sales Of The Joint Chiropractic
According to the company, the average gross annual sales per franchised store in 2022 was $585,695. The top earning quartile is $963,202, where around 39% of all clinics met or exceeded this number. The lowest end is $300,127, where about 55% met or exceeded this number.
How Much Does A Joint Chiropractic Franchise Owner Earn?
In the same document, we see that a Joint Chiropractic franchise makes an average of $87854.25 in net profit annually. This number is just the EBITDA, meaning it only removes the operating expenses. In reality, your numbers might be slightly lower once you remove all the expenses.
This is a table showing the calculation of the net profit of The Joint Chiropractic franchise owner:
| Financial Overview | Percentage of Revenue | Amount ($) |
|---|---|---|
| Individual Franchise Annual Revenue | 100% | 585695.00 |
| Rent | 10.63% | (62230.09) |
| Insurance | 5.31% | (31115.05) |
| Salaries | 21.25% | (124460.19) |
| Franchise Royalty Fees | 5.31% | (31115.05) |
| Utilities | 2.13% | (12446.02) |
| Cost of Goods Sold (COGS) | 26.56% | (155575.23) |
| Labor (Variable) | 13.81% | (80899.12) |
| Total (Expenses) | 85.00% | (497840.75) |
| Net Profit | 15.00% | 87854.25 |
Note: The displayed expenses are estimates based on industry averages and standard costs. Actual expenses may vary due to factors like location, business size, and market conditions. We recommend conducting detailed research or consulting with a financial advisor for a tailored financial analysis.
Payback Period
A Joint Chiropractic Franchise investment is $478,997, and the yearly profit is $87,854.25. So, to find out how long it will take to earn back the initial investment:
Payback Period = Investment / Yearly Profit = $478,997/ $87,854.25= 5.45 years
Based on these figures, it will take approximately 6 years to pay back the initial investment for The Joint Chiropractic. This time period could be longer or shorter depending on your sales, revenue, and profit figures.
Failure Rate Of The Joint Chiropractic
Franchised Outlets:
| Year | Outlets at the Start of the Year | Outlets at the End of the Year | Net Change |
|---|---|---|---|
| 2020 | 453 | 515 | +62 |
| 2021 | 515 | 610 | +95 |
| 2022 | 610 | 712 | +102 |
For the Franchised outlets:
- In 2020, the growth rate was (62)/453×100≈13.68%
- In 2021, the growth rate was (95)/515×100≈18.4%
- In 2022, the growth rate was (102)/610×100≈16.72%
Company-Owned Outlets:
| Year | Outlets at the Start of the Year | Outlets at the End of the Year | Net Change |
|---|---|---|---|
| 2020 | 60 | 64 | +4 |
| 2021 | 64 | 96 | +32 |
| 2022 | 96 | 126 | +30 |
For the Company-Owned outlets:
- In 2020, the growth rate was (4)/60×100≈6.66%
- In 2021, the growth rate was (32)/64×100≈50%
- In 2022, the growth rate was (30)/96×100≈31.25%
Total Outlets:
| Year | Outlets at the Start of the Year | Outlets at the End of the Year | Net Change |
|---|---|---|---|
| 2020 | 513 | 579 | +66 |
| 2021 | 579 | 706 | +127 |
| 2022 | 706 | 838 | +132 |
For Total outlets:
- In 2020, the growth rate was (66)/513×100≈12.86%
- In 2021, the growth rate was (127)/579×100≈21.93%
- In 2022, the growth rate was (132)/706×100≈18.69%
According to the above-mentioned data, there is no failure rate for franchised outlets as the outlets at the end of the year increased during the span of 3 years.
We can see that the franchised outlets for The Joint Chiropractic grew from 2020 to 2022, showing a growth rate between 13.68% and 16.72%.
On the other hand, for company-owned outlets, the growth rate of The Joint Chiropractic was lying in the range between 6.66% and 31.25% for the same period of time.
Overall, when we combine the data of franchise and company-owned outlets, we can see that the The Joint Chiropractic franchise has expanded in the years 2020-2022, showing a total growth rate between 12.86% and 18.69%.
Training and Support Of A Joint Chiropractic
The initial training program has 26 hours of classroom and 35 hours of on-the-job training. This program consists of teaching all the operational and necessary information to the franchisee. The classroom training takes place in Arizona, and on-the-job training happens at a certified training clinic before the classroom training. There might be additional training before or after the opening of the store depending on various factors.
They also provide an ongoing support system before and after your opening. They help with lease negotiation, site selection, and marketing materials and give operational support.
Terms of Agreement and Renewal
The initial franchise agreement is for ten years. After the initial ten years, there might be a renewal possibility if the franchisor agrees to it. The renewal is for one renewal term of 10 years.
Obligations and Restrictions
The franchisee is obligated to directly participate in the daily operation of the store on a full-time basis. They have to be at the store to oversee all the operations. In cases where the franchisee can’t fulfill this obligation, then they must have a trained manager to oversee the operations.
The franchisees must obey all the described methods, policies, specifications, and standards set by the franchisor in the operation of the store. The location of the franchised clinic can not be used for any other business or purpose than to run a Joint Chiropractic Franchise.
Financial Assistance
The Joint Chiropractic does not offer direct financial assistance, but they offer indirect financial assistance. They have relationships with financial institutions that can provide them with the necessary financing.
The Joint Chiropractic Comparison
| Name | Franchise Fee | Royalty Fee | Initial Investment |
|---|---|---|---|
| AlignLife | $49,000 | 7% | $79,711-$345,154 |
| 100% Chiropractic | $50,000-$300,000 | 6.5% | $347,484-$829,180 |
| The Joint Chiropractic | $39,900 | 7% | $215,297-$478,997 |
Conclusion
Looking at all the numbers and what they provide, The Joint Chiropractic seems like a decent opportunity as a business. The potential payback period is between 5 to 6 years, with an expected net profit of $130,000 annually per store. These are great numbers, and they have a massive brand reputation in the US, with over 850 clinics.
All these results show us that if you are thinking about investing in The Joint Chiropractic Franchise, it might be an extremely worthwhile effort. However, it’s worth noting that the company made a huge loss in its latest financial report, and the financial risk is always there.
FAQs
How profitable is the Joint Chiropractic Franchise?
According to the company’s document, an average Joint Chiropractic franchise location makes $130,000 in net profits, representing a 22% profit margin.
Who founded The Joint Chiropractic ?
The company was founded in 1999 and started to franchise in 2003. It was founded by Fred Gerretzen.
How many Joint Chiropractic locations are there?
There are over 850 locations across the United States.
Where is The Joint Chiropractic headquartered?
The Joint Chiropractic is headquartered at Scottsdale, Arizona.