Express Employment Professionals is a scalable B2B franchise:
- $6.5M sales per owner (open 24 months)
- $39M Top franchisee in 2022
- 40-year-old legacy brand
- $140k+ investment
Let’s dive in
Business Model
Express is a full-service staffing agency that offers temporary & direct hire services.
They help more than 500,000 people find jobs every year in these industries:
- Office
- Logistics
- Professional
- Skilled Trades
- Manufacturing
- Light Industrial
The franchisee’s primary role is driving sales.
You must hit the streets. Network with local business owners, build referral relationships, and cold-call owners.
The franchisor takes care of all the back end.
1) They are the “employer of record”
2) Fund 100% of the loaded payroll
3) Handle workers comp & unemployment
4) Invoicing & collect payments from clients
This is a huge benefit since it simplifies your responsibility & helps with the cash flow.
Earnings Potential
A staffing agency buys & resells labor.
For example:
- Buy an hour of labor for $18
- Sell an hour of labor for $23
- Gross margin of $5 (20% GM)
This is a high-sales, low-margin business.
Royalties are charged uniquely. They do not take a percentage of sales; instead, they earn a percentage of the gross margin.
Gross margin is defined as sales minus direct wages and all associated “loaded” costs, such as employer-side payroll taxes, workers’ compensation premiums, early-pay discounts, professional liability insurance, and more.
Express Employment has a very detailed Item 19.
The most important number is “AAGM” which stands for “Average Annual Franchisee Share of Gross Margin”
AAGM is the franchisee’s share after loaded payroll costs & royalties.
Average AAGM grew from $677k in 2020 to $954k in 2022
The Top 10% (55 units) averaged over $20M in sales.
The top franchisee did almost $40M in 2022.
Most franchisees operate a single territory. You can build a massive business within a single territory.
The FDD also includes a ramp-up table that shows performance by the number of months open.
Estimating the time it will take to become cash-flow positive is the biggest unknown factor when opening a new franchise.
A table like this helps a lot when building a budget since you can estimate your overhead, such as lease, insurance, recruiter payroll, etc.
By month 5, franchisees are earning over $10k in AAGM (gross margin after royalties)
By month 12, hitting $20k+ per month. By month 19, hitting $30k+ per month.
Start-Up Costs
A new location costs $140,000 to $200,000 all-in for the franchisee fee, office build-out, computers, training, working capital, etc.
They also have several re-sales available throughout the country.
Ideal Franchisee
This is NOT a “sit on the couch & let the marketing do the work” model.
They are looking for active owner/operators:
- Build relationships
- Professional & coachable
- Comfortable making cold calls
They want people with big ambitions to build a big company.
Next Steps
My team helps people buy their first franchise.
Reply here (name, phone & zip code) to learn more.
We can check on available resales & new territory availability.
We introduce you to the franchisor and provide due diligence resources, coaching, and professional referrals to help you through the process.
It’s all 100% FREE.
If Express isn’t the right fit, my team can help you explore other franchises. Click here to book a free discovery call.
Cheers!
