Five Star Painting Franchise Analysis 2026

What is Five Star Painting?

Founded in 2004, Five Star Painting operates 245 US locations providing residential and commercial painting services with professional crews and quality guarantee. The franchise builds recurring relationships through referrals and property owner networks.

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Investment & Fee Data

Investment Overview

Franchise Fee$45K

Total Investment$77K – $185K

Royalty Rate6.0%

Ad/Marketing Fund2.0%

Total Fee Burden8.0%

System Size & Growth

US Locations245

Unit Growth Rate+15.0%

Founded2004

Franchising Since2020

FDD Item 19Yes ✓

🔒 Premium Data Available

Avg Unit Volume (AUV)$1.7M

Owner Earnings$200K

SBA Default RateN/A

5-Year Survival90%

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💡 What This Means For You

The combined fee burden of 8.0% is within the industry average of 8-10%. Beyond the listed investment, expect approximately $62K in hidden costs (working capital, legal, insurance, tech fees) — bringing your realistic total closer to $193K.

Financial Performance & Risk Analysis

Financial Performance

Avg Unit Volume (AUV)$1.7M

Net Profit Margin20%

Est. Owner Earnings$200K

Breakeven3-6 months

Payback Period1-2 years

Capital Requirements & Operations

Liquid Capital Required$80K

Net Worth Required$200K

Staff Required5-15 subcontractors

Training8 weeks

TerritoryPopulation-based territory

Multi-Unit RequiredNo

Term Length10 years

Risk & SBA Safety Data

SBA Default RateNo Data

5-Year Survival90%

Renewal FeeVaries

Transfer FeeVaries

💡 Financial Analysis

The revenue-to-investment ratio of 12.8x is excellent — every dollar invested generates $12.8 in annual revenue, well above the 2x industry benchmark. At estimated owner earnings of $200K/year, the simple payback period is approximately 0.7 years.

Due Diligence Deep Dive

The data franchise brokers don't show you — real costs, owner lifestyle, franchisee satisfaction, exit options, and FDD transparency.

💰 True Cost of Ownership

Working Capital (6 mo)$30K

Legal & Accounting$12K

Insurance (Annual)$8K

Tech/Software (Monthly)$400/mo

Lease Deposit Est.$0

Grand Opening$10K

Total Hidden Costs$62K

👤 Owner Reality Check

Hours Per Week45-55

Absentee Owner Friendly?Yes ✓

Manager-Run Possible?Yes ✓

Seasonal VariationModerate

Labor Cost (% of Revenue)40%

Owner-managed operations. Expect to invest 45-55 hours per week managing day-to-day activities, staff oversight, customer acquisition, and brand compliance. Focus on operational efficiency and franchisee standards adherence.

📊 Franchisee Health

Satisfaction Score79/100 (Good)

Annual Turnover Rate4.0%

Litigation Count (Item 3)3 cases

5-Year Closure Rate3%

Avg Franchisee Tenure8 years

Franchisee AssociationYes ✓

🚪 Exit Strategy & Resale

Resale Value Multiple2.0-3.0xx earnings

Transfer RestrictionsFranchisor approval required; right of first refusal

Non-Compete Period2 years

Non-Compete Radius15 miles

Avg Time to Sell6-12 months

Exit DifficultyModerate

📋 FDD Transparency Report

Item 19 QualityModerate

Item 19 Includes:

✓ Average unit volume

✓ Operating costs

Territory ProtectionModerate

Territory scope varies by location; moderate exclusivity provided

Required Suppliers?No

Supplier Markup RiskLow

Renewal Terms10-year term; renewal terms subject to brand standards compliance

🚩 FDD Red Flags & Green Flags

⚠️ Watch Out For:

Moderate fee structure (8.0% total)Low litigation history

✅ Positive Signals:

Item 19 comprehensive financial disclosureEstablished system with strong unit baseTrack record data available

💡 Due Diligence Verdict

Only 3 litigation cases in the FDD is a positive sign of a healthy franchisor-franchisee relationship.

AI Disruption Risk Assessment

🛡️ AI Disruption Risk: Low

19/100

AI-Proof Disruption Timeline: 5-10 years High Risk

Low risk. Interior/exterior painting requires human skill and judgment. While robotic painting exists, it's not economically scalable for residential use. The franchise model remains defensible.

AI Threats:

Painting labor is difficult to automateRobotic painting emerging but not scalable

Defensive Moat:

Franchisee network, skilled painter relationships, customer relationships, operational systems.

🤖

AI Risk Analysis

See how AI will impact Five Star Painting over the next 5-10 years — threats, moats, and disruption timeline.

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Territory Saturation Analysis

0.07

Units per 100K pop.

0.02x

Saturation Index

vs. Home Services avg (3.09/100K)

States with Presence

Low Saturation

Five Star Painting has significant whitespace opportunity relative to its category.

Geographic Distribution

No units

High density

Most Saturated States

State	Units	Population	Per 100K
Wyoming	5	581,000	0.86
Vermont	5	645,000	0.78
Washington DC	5	671,000	0.75
South Dakota	5	887,000	0.56
Rhode Island	5	1,095,000	0.46

Least Saturated States

State	Units	Population	Per 100K
Texas	5	30,503,000	0.02
California	8	39,029,000	0.02
Florida	6	23,555,000	0.03
Georgia	5	11,370,000	0.04
New York	8	18,777,000	0.04

Growth Opportunity States

High-population states where Five Star Painting has minimal or no presence — potential expansion territories.

Connecticut Arkansas West Virginia Delaware North Dakota

Investment Thesis

Five Star Painting carries a BUY signal with a FutureScore of 78/100. Potentially the best-kept secret in franchising. A $77K-$185K investment generating $1.68M AUV with 20% margins is extraordinary. The Neighborly ecosystem provides cross-referrals from 5,500+ fellow franchise owners. Low overhead home-based model keeps costs minimal.

Ideal Investor Profile: Hands-on operator seeking best investment-to-revenue ratio available

Strengths

$1.68M AUV on $77K-$185K investment — best ratio in home services after senior careNeighborly portfolio = massive referral network20% net marginHome-based business model = minimal overhead8% total fee burden

Risk Factors

Subcontractor management complexitySeasonal in northern marketsNewer franchise system (2020)

Five Star Painting