How much does it cost to open a Plato's Closet franchise?

The total initial investment for a Plato's Closet franchise ranges from $327,200 to $449,000. This includes the franchise fee of $25,000, buildout costs, equipment, and initial working capital.

What are the ongoing fees for a Plato's Closet franchise?

Plato's Closet franchisees pay a 5.0% royalty fee and a 2.0% advertising/marketing fund contribution. These are typically calculated as a percentage of gross revenue.

How much money can you make with a Plato's Closet franchise?

Based on Item 19 financial performance data, the median Plato's Closet franchise generates $1,315,503 in annual revenue. Estimated owner profit is approximately $118,395.

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Retail

Plato's Closet Franchise Cost Breakdown

Complete investment analysis based on official FDD data

Total Investment

$327,200 – $449,000

Franchise Fee

$25,000

Royalty Rate

5.0%

Initial Investment Range

Low: $327,200 High: $449,000

The total initial investment to open a Plato's Closet franchise ranges from $327,200 to $449,000, as disclosed in their Franchise Disclosure Document. This includes the one-time franchise fee of $25,000.

Midpoint estimate: $388,100

Franchise Fee

$25,000

One-time initial fee

The Plato's Closet franchise fee is a one-time upfront payment made to the franchisor when you sign the franchise agreement. This fee grants you the right to operate under the Plato's Closet brand and is included in the total initial investment range above.

Ongoing Fees

Royalty Fee

5.0%

of gross revenue

Ad/Marketing Fund

2.0%

of gross revenue

Total Ongoing Fee Burden: 7.0% of gross revenue

Combined royalty and advertising fund contributions before any other fees.

Other Ongoing Fees

Fee Type	Rate	Type	Notes
Continuing Fee	5.0	PCT	Due on or before Wednesday of each week for the previous week. Winmark requires direct withdrawal from bank account. Gross Sales means total revenues from sale of goods and services (cash, check, credit card, or trade), less customer refunds and returns, including Internet sales but excluding wholesale transactions between franchisees and sales tax collected and paid to tax authorities.
Marketing Fee	1500.0	FIXED	Due January 1 of each year. Initial payment prorated based on effective date of Franchise Agreement. May increase with 60 days' prior written notice, but will not increase more than $1,000 during the term of the Franchise Agreement.
Cooperative Advertising	5.0	PCT	Maximum amount is 5% of Gross Sales. Amount established by Winmark or local franchisees through advertising cooperative. If Company-owned store is a member, it has voting power equal to franchised stores but not controlling power. Currently no Company-owned Plato's Closet stores.
Local Marketing Expenses	5.0	PCT	Minimum amount when combined with cooperative advertising expenses is 5% of Gross Sales. Must be spent during each calendar year. If total spending on cooperative and local advertising is less than 5% of Gross Sales, Winmark may require payment of the difference to be spent on advertising initiatives in franchisee's market in subsequent year at Winmark's discretion.
Advertising Fee	2.0	PCT	Currently not imposed. If imposed, up to 2% of Gross Sales, due on or before Wednesday of each week for the previous week. Winmark may increase minimum advertising expenditures to up to 6% of Gross Sales with 60 days' notice. Of the 6%, up to one-third (2% of Gross Sales) would be paid as Advertising Fee to Winmark's Advertising Fund; balance used for cooperative and local advertising.
Transfer Fee	10000.0	FIXED	Payable before completion of transfer when Franchise Agreement, substantial portion of Store assets, or any controlling interest in franchisee is transferred.
Audit Expenses	N/A	VARIABLE	Payable after inspection or audit only if understatement is greater than 2%.
Renewal Fee	10000.0	FIXED	Due 30 days before renewal of Franchise Agreement.
DRS Maintenance Fee	1000.0	FIXED	Fee for upgrades to antivirus and database engine software supporting DRS software. $1,000 for term of Franchise Agreement. Due upon placement of order of POS System and upon renewal of Franchise Agreement. Upon renewal, then-current rate will be applied.
Technology Fee	N/A	VARIABLE	Currently $0, not charged. May be established with 60 days' prior written notice for technology-related services including extranet platform, training platforms, and social/digital media management platforms. If established, estimated between $500-$2,500 per year per Store. If established, will not increase by more than 10% each year.
Remodeling Expenses	N/A	VARIABLE	Must modernize Store upon notice from Winmark, but not more than once every 5 years. Must conform to standards for similarly situated new Stores. Scope may range from repainting to complete refurbishment including fixtures, signage, equipment, and POS System. Costs vary based on brand standards, Store condition, and labor/materials costs. Modernization plans require Winmark approval before execution.
Insurance	N/A	VARIABLE	Payable to Winmark only if franchisee fails to pay insurance premium and Winmark pays it on their behalf. Due when Winmark requests reimbursement.
Inventory	N/A	VARIABLE	Must replenish Store inventory (new and used items) regularly. Quarterly costs generally range from $65,000 to $80,000, varying based on seasonal demand changes and Store sales.
Interest Expenses	18.0	PCT	Lesser of 18% per year or maximum rate permitted by law. Payable when due if Continuing Fee or other amounts due to Winmark are not timely paid.
Costs and Attorneys' Fees	N/A	VARIABLE	Winmark may recover costs and reasonable attorneys' fees when incurred if franchisee loses in a dispute with Winmark.

What You Get

Financial Performance (Item 19)

Median Revenue

$1,315,503

per year, per location

Mean Revenue

$1,150,405

per year, per location

Profitability Estimate

Estimated Owner Profit

$118,395

per year

Profit Margin

9.0%

of revenue

Estimation method: benchmark

Estimated ROI (Simple Payback): 3.3 years

Based on midpoint investment of $388,100 and estimated annual owner profit of $118,395.

Unit Growth & Failure Rate

Avg. Annual Closure Rate

1.8%

Low risk — below industry average

Net Unit Growth

+26 units

From 2022 to 2024

Unit Activity History

Year	Start	Opened	Closed	Transfers	End
2022	489	—	—	—	500
2023	500	—	—	—	506
2024	506	—	—	—	515

Is a Plato's Closet Franchise Worth It?

Based on the FDD data, here is a data-driven snapshot of the Plato's Closet franchise opportunity:

Overall Score

77/100

Strong opportunity

Est. Payback Period

3.3 yrs

Average payback

Risk Level

Low

1.8% annual closure rate

Plato's Closet scores well across our evaluation criteria, indicating a strong franchise system. With median unit revenue of $1,315,503 and a combined fee burden of 7.0% of gross revenue, prospective franchisees should model their own financial projections carefully. For a complete analysis including risk factors, deal-breaker flags, and detailed financial modeling, see the full report.