Some Common Franchise Terms for Opening a Childcare Franchise

Table of Contents

When it comes to how to open a childcare franchise, there are plenty of smart reasons to do so with a brand like Children’s Lighthouse, including our time-tested business model, respected brand name, our training and support, and much more. But as you continue to learn about the world of franchising, you might be confused by some of its terminology and language, a lot of which is quite unique. Here, let’s look at a few common franchise terms you’ll come across as you move forward in your journey, what they mean, and why they’re important.


Put simply, a franchisor is a brand that’s offering an investment opportunity to potential franchisees. But in reality, a good franchisor is much more than that! It’s the people behind the brand who really determine the strength of a franchisor because those people will be the ones you’ll turn to for ongoing guidance, resources, and support. They’ll also be the ones who make sure you’re well trained and ready to open your preschool. The training and support we provide are very much a part of how to open a childcare franchise with Children’s Lighthouse, so we make sure it’s comprehensive and ongoing.

Franchise Fee

A franchise fee is the one-time lump sum you’ll pay to become part of a brand family. All franchisors charge a franchise fee, payable upon the signing of a franchise agreement, and when you open a childcare franchise with Children’s Lighthouse, you can expect to pay approximately $30,000. This fee is one of the most affordable in the industry and covers the cost of your onboarding and pre-opening training. It also grants you access to our proprietary materials, logos, and resources, as well as gives you the right to do business under the recognized and respected Children’s Lighthouse name.

Start-up Costs

Opening any new business requires an investment of not only time and effort but of money as well. Start-up costs, sometimes called an initial investment, refer to the total financial investment you’ll need to make in our early learning center opportunity in order to get your preschool up and running. This sum will always include expenditures like inventory, leases or real estate purchases, insurance and utilities, and your franchise fee.


Royalties are the monthly fees collected by the franchisor against your gross receipts. Among other things, this money is used to fund the ongoing support we provide you, research and development, marketing, and more. Children’s Lighthouse charges a monthly 7% royalty fee and a .5% monthly advertising fee.

Franchise Agreement

A franchise agreement, sometimes called a franchise contract, is the document you sign before paying your franchise fee that includes the rights, responsibilities, and obligations of the franchisor and franchisee. It will also spell out your territory if any, what kind of training and support you can expect, and under what conditions you can sell your franchise, among other important information.

Still, have questions about starting a childcare franchise with Children’s Lighthouse? We’d love to hear from you, so don’t hesitate to reach out!

Table of Contents

Learn More About Franchising with Children's Lighthouse

Single Blog Post Form

"*" indicates required fields

Do you meet liquid asset requirement of 400K?*
This field is for validation purposes and should be left unchanged.

Read more on this topic

Childcare Franchise Training

Our Childcare Franchise Training Makes the Difference!

If you think you need prior experience in the early childhood education sphere to take advantage of a Children’s Lighthouse franchise opportunity, you couldn’t be more mistaken. Thanks to our childcare franchise training and comprehensive ongoing support, just about anybody with the right financial resources and a big-picture mentality can benefit from everything our investment

Read More »
multi unit franchise

Our Business Model and Multi-Unit Childcare Franchise Ownership

Small business ownership can be an extremely rewarding way to make your living, especially if you do so in an industry that’s as important and robust as the childcare sphere. But why stop at one location? Multi-unit childcare franchise ownership with Children’s Lighthouse is a smart way to leverage our time-tested business model. Our decades

Read More »