Guide 9 min read Updated May 6, 2026

Cost to Start a Midas Franchise in 2026

Q: Why is the Midas royalty rate so high?

Midas charges a 10% royalty — high for auto service franchises. The rate reflects the brand's recognition value in a safety-critical service category where customers specifically seek out trusted names for brake and exhaust repairs. TBC Brands positions this as a return on brand equity rather than a straight operating cost.

Midas franchise startup costs run $345K–$1.4M for an auto repair shop specializing in brakes, tires, exhaust, and general repair. Midas is owned by TBC Brands and has over 1,700 locations in North America. The brand's 10% royalty rate is high for the franchise sector but is supported by strong brand recognition.

Midas franchise costs at a glance

Total investment	$345,000–$1.4M
Franchise fee	$30,000
Royalty	10%
Liquid capital required	$80,000
Net worth required	$200,000

Source: Midas Franchise Disclosure Document (FDD) · as of 2026-05-06. Figures vary by market and site; verify against the current FDD before signing.

Key takeaways

Total estimated startup cost: $345K–$1.4M (auto repair — brakes, tires, exhaust, general repair)
Franchise fee: $30,000
Ongoing royalty: 10% of net sales — high but supported by strong brand recognition
Net worth requirement: $200K+; liquid capital requirement: $80K+
Parent: TBC Brands — 1,700+ North American locations

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Total startup cost breakdown

Per the current FDD, total estimated initial investment for a Midas franchise runs $345,000–$1,400,000. The range reflects new build vs. conversion of an existing auto service building, market, and whether the franchisee acquires an existing Midas location:

Franchise fee: $30,000
Real estate and leasehold improvements: $100,000–$600,000 (existing building conversion vs. new construction)
Equipment (lifts, diagnostic equipment, tire equipment, alignment equipment): $100,000–$300,000
Signage and exterior: $20,000–$60,000
Initial parts inventory: $30,000–$80,000
Training and travel: $5,000–$15,000
Technology and POS: $10,000–$25,000
Working capital: $30,000–$100,000
Miscellaneous pre-opening: $20,000–$60,000

Ongoing fees and royalty structure

Midas franchisees pay a 10% royalty on net sales plus an advertising fund contribution of 7–9% — for a combined 17–19% of net sales. Midas's royalty rate is among the highest in the auto service franchise sector. This rate reflects the brand's strength in a category where customer trust and brand recognition are primary purchase drivers — consumers are more likely to return to a nationally recognized brand for safety-critical services like brake and exhaust repairs than to shop price alone. TBC Brands' advertising platform supports national and regional campaigns, digital presence, and the Midas loyalty program.

Net worth and liquid capital requirements

Midas requires prospective franchisees to demonstrate net worth of $200,000 or more and liquid capital of $80,000 or more — financial entry thresholds that are lower than most auto service competitors at this brand level. Auto repair experience or management background is preferred but not always required. The brand evaluates candidates on business operations aptitude, customer service orientation, and community presence, in addition to financial qualifications.

Financing options

Midas is listed on the SBA Franchise Directory, qualifying franchisees for expedited SBA loan processing. Common financing paths:

SBA 7(a) loan: Covers franchise fee, leasehold improvements, equipment, parts inventory, and working capital. Standard structure for auto service franchises.
Equipment financing: Vehicle lifts, tire machines, alignment equipment, and diagnostic tools can be financed separately — often at favorable rates given the long useful life of auto service equipment.
IRS Section 179: Auto repair equipment qualifies for immediate expensing in the year placed in service, reducing the tax burden in the startup year.
Working capital line of credit: Useful for managing parts inventory purchasing cycles and seasonal cash flow variation.

What lenders look for in a Midas franchise application

Midas is on the SBA Franchise Directory, qualifying franchisees for expedited SBA loan eligibility. At $345K–$1.4M, SBA 7(a) covers most of the range; larger new-construction projects may require SBA 504 for real estate. Here is what underwriters evaluate:

DSCR 1.25×–1.35× on auto repair revenue pro forma: SBA SOP 50 10 8 sets the minimum DSCR at 1.15×; SBA participating lenders for franchise startups typically require 1.25×–1.35×. For Midas, lenders build the pro forma from FDD Item 19 average gross sales for comparable shops, modeling the 17–19% combined royalty/ad fee load, lease, technician labor, parts COGS, and insurance to project net cash flow. Shops with strong local DRP (direct repair program) relationships for insurance-funded work typically support higher revenue projections.
Equity injection 10–30% of project cost: Per SBA SOP 50 10 8, borrowers must inject equity from personal funds not borrowed for this purpose. At $345K–$1.4M, that runs $34K–$420K. New-construction auto service facilities at the top of the range typically require 20–30% equity; conversion projects at the lower end may qualify at 10–15%.
Net worth $200K+ per franchisor requirement: Lenders verify the borrower meets Midas's minimum net worth threshold ($200K) and liquid capital requirement ($80K) in addition to SBA equity injection standards.
Lift and equipment permitting: Multi-bay auto service shops require automotive lift inspections and state-specific permits for vehicle service operations. Lenders and franchisors verify the proposed site can obtain required operating permits before loan approval.
Automotive business management experience: Auto repair experience is not required by Midas, but lenders assign lower risk to operators with demonstrated automotive retail, fleet management, or prior franchise experience in any service concept.

Apply at ClearValue Lending

ClearValue Lending works with auto service franchise operators on SBA and equipment financing structures. Start at small business financing or apply at Find my match. Your file routes to the funding partners best matched to your file.

Sources

Midas is listed on the SBA Franchise Directory, qualifying franchisees for expedited SBA loan eligibility. — SBA Franchise Directory
SBA 7(a) loans finance franchise startups including equipment, leasehold improvements, and working capital for auto service concepts. — SBA 7(a) Loan Program
Qualifying auto repair equipment placed in service during the tax year may be immediately expensed under IRS Section 179. — IRS Publication 946
All Midas franchise cost and fee data derives from the current Franchise Disclosure Document (FDD) filed under the FTC Franchise Rule. — FTC Franchise Rule — Buying a Franchise: A Consumer Guide

Frequently asked questions

How much does a Midas franchise cost in 2026?

Per the current FDD, total estimated initial investment runs $345,000–$1,400,000. New-construction auto service shops are at the high end; conversions of existing service buildings are at the low end.

Why is the Midas royalty rate so high?

Midas charges a 10% royalty — high for auto service franchises. The rate reflects the brand's recognition value in a safety-critical service category where customers specifically seek out trusted names for brake and exhaust repairs. TBC Brands positions this as a return on brand equity rather than a straight operating cost.

Who owns Midas?

Midas is owned by TBC Brands, a Florida-based tire and auto service company that also operates Big O Tires and NTB (National Tire & Battery).

What services does a Midas franchise offer?

Midas locations offer brakes, tires, oil changes, exhaust systems, steering and suspension, filters, batteries, and general mechanical repair — a broad service basket relative to single-service competitors.

Can I finance a Midas franchise with an SBA loan?

Yes. Midas is on the SBA Franchise Directory. SBA 7(a) covers franchise fee, build-out, equipment, and working capital. Equipment financing is also common for the lift and diagnostic equipment.

What DSCR do lenders require for a Midas SBA loan?

SBA SOP 50 10 8 sets the minimum global DSCR at 1.15× — projected net cash flow must cover all debt obligations at 1.15× or better. Most SBA participating lenders require 1.25×–1.35× for franchise startups. For Midas, lenders model DSCR from FDD Item 19 gross sales data for comparable shops, adjusting for the 17–19% combined royalty/ad fee, lease, technician labor, parts costs, and insurance. Shops with established insurance direct repair program (DRP) relationships support stronger DSCR projections because DRP revenue is non-discretionary. Source: SBA SOP 50 10 8 (https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs).

How much equity injection is required for a Midas SBA loan?

Borrowers must inject equity from personal funds — not borrowed for this purpose — per SBA SOP 50 10 8. For Midas's $345K–$1.4M range, equity injection runs $34K–$420K (10–30% of project cost). New-construction auto service facilities and high-end build-outs near the top of the range typically require 20–30% equity; conversions of existing buildings at the lower end may qualify at 10–15%. Equity is documented at closing with bank statements showing funds seasoned in the account for 60+ days.

Summary:

This article is for educational purposes and is not financial, legal, or tax advice. Rates, fees, qualification requirements, and product availability are illustrative ranges that vary by lender, market conditions, and individual business profile. ClearValue Lending is a funding platform; all financing is subject to lender partner approval and terms. Always read your contract end-to-end and verify specific numbers before signing.

https://clearvaluelending.com/franchises/midas/cost-to-start

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