Fastest Labs Franchise in 2024: Costs, Fee & FDD
Explore Fastest Labs’ impressive growth, franchise costs, and earning potential in our comprehensive analysis. See how this franchise opportunity stacks up and whether it’s the right fit for your investment goals.
Table of Contents:
Fastest Labs was founded by Dave Claflin and his wife, LeDona, after running Enhouse America Inc. for eight years. In 2008, they launched a new division called LabWork NOW Drug Testing in San Antonio, Texas. The brand quickly gained recognition for its top-notch services, cleanliness, and exceptional customer care, setting a new standard in the drug and alcohol testing industry. Due to the rapid growth and success, Dave decided to expand LabWork NOW into a nationwide franchise. In 2009, the trademark Fas-Tes was acquired, and in 2010, the company was rebranded as Fas-Tes Franchise Systems, LLC. By 2013, the name Fastest Labs was adopted, and it has since become a recognized name in the industry.
Fastest Labs specializes in drug, alcohol, and DNA testing services. Their core offerings include accurate and rapid testing for various substances, which caters to both individual and corporate clients. The company’s services are essential for employers conducting pre-employment screenings, as well as for individuals needing personal testing. Fastest Labs is known for its state-of-the-art facilities and commitment to providing affordable and reliable testing solutions. Their core customers are businesses, organizations, and individuals seeking trustworthy and efficient testing services.
The franchise has seen remarkable growth over the years. From 2015 to 2016, Fastest Labs expanded from 9 franchises in 3 states to 19 franchises in 7 states. By 2018, the number of franchises had surged to 32 across 14 states, and as of 2020, the brand boasts 79 franchises in 20 states. This expansion is a testament to the brand’s success and the increasing demand for their services. Fastest Labs continues to grow rapidly, supported by a robust franchise network and a dedicated support team.
The franchise support system at Fastest Labs is designed to ensure the success of its franchisees. They offer comprehensive training programs, including state-of-the-art online training modules, to equip new franchisees with the skills and knowledge needed to excel. The franchise provides ongoing support to help franchisees with marketing, operations, and customer service, reflecting their commitment to maintaining high standards and delivering excellent service. With a focus on quality, integrity, and customer satisfaction, Fastest Labs is not just in the testing business but is deeply invested in the people they serve.
Fastest Labs Franchise Insights
- Fastest Labs grew from 9 franchises in 3 states in 2015 to 79 franchises in 20 states by 2020, and now boasts over 180 locations, reflecting a remarkable 99% unit growth for the last year.
- The franchise started as LabWork NOW in 2008 and rebranded to Fastest Labs® in 2013, with the name officially registered as a trademark in 2014, marking a strong and evolving brand identity.
- The franchise prides itself on delivering clean, professional, and affordable testing services, striving to be not just in the testing business but the people business, enhancing customer satisfaction.
- They provide a range of services including drug, alcohol, and DNA testing, catering to both individual and corporate clients, making them a versatile player in the testing industry.
Fastest Labs Franchise Key indicators
Growth YOY (%)
99%
vs industry 0%
Total U.S. Franchised Units
181
3-Year Failure Rate
3%
vs industry 16%
Sales-to-Investment ratio
1:1
How much does it cost to open a Fastest Labs franchise?
Understanding the potential investment size and capital requirements is crucial when considering opening a Fastest Labs franchise. These financial commitments, including initial franchise fees, equipment costs, and ongoing operational expenses, impact the feasibility and profitability of the venture. Thoroughly evaluating these factors ensures that potential franchisees are prepared for the financial responsibilities and can make informed decisions about their ability to sustain and grow the business, ultimately contributing to long-term success.
Min & Max Investment
Opening a Fastest Labs franchise involves several key costs, which are outlined in Item 7 of the Franchise Disclosure Document (FDD). You can see a breakdown of the costs to open a Fastest Labs below from the most recent Item 7 below:
| Type of Expenditure | Minimum Investment | Maximum Investment |
|---|---|---|
| Initial Franchise Fee | $59,500 | $59,500 |
| Airfare and Living Expenses While Training | $1,000 | $1,500 |
| Lease and Utility/ Security Deposits | $2,500 | $5,000 |
| Exterior Signage and Installation | $5,000 | $9,000 |
| Office Equipment | $3,500 | $6,500 |
| Initial Testing Equipment | $3,500 | $5,000 |
| Insurance and Miscellaneous Opening Expenses | $5,500 | $11,000 |
| Computer Hardware and Software | $6,000 | $7,500 |
| Start-Up Kit and Uniforms | $1,000 | $1,500 |
| Internet Marketing SEO, Keywords and Social Media Advertising Expenses | $18,000 | $18,000 |
| Additional Funds (3 months) | $20,000 | $40,000 |
| Total Estimated Initial Investment | $125,500 | $164,500 |
Item 7 in the Franchise Disclosure Document (FDD) is the “Estimated Initial Investment” section. It outlines the total costs a franchisee can expect to incur when starting a franchise, including the initial franchise fee, equipment, inventory, real estate, and other startup expenses. This section is crucial because it provides potential franchisees with a detailed understanding of the financial commitment required, helping them assess affordability and plan their investment strategy effectively.
Required Capital
To open a Fastest Labs franchise or a similar business in the drug and alcohol testing industry, you’ll need to prepare for several financial commitments beyond the initial franchise fee. Here’s a breakdown of the required capital, liquid assets, and net worth:
- Initial Capital Requirement The total investment for a Fastest Labs franchise ranges from $126,000 to $165,000. This includes expenses such as equipment, supplies, leasehold improvements, and other initial setup costs. Assuming that you will finance your franchise investment, you should plan to have 20% of the total investment amount in the form of equity (cash) for the investment.
- Liquid Assets Requirement Franchisees typically need to have liquid assets of approximately $50,000 to $75,000. This is the amount of cash or easily accessible funds available to cover operating expenses and ensure smooth business operations.
- Net Worth Requirement The required net worth for potential franchisees generally falls between $200,000 and $300,000. This includes your total assets minus liabilities, demonstrating your overall financial stability and ability to support the business.
How much does a Fastest Labs franchise owner make?
Calculating the salary of a Fastest Labs franchise owner involves analyzing gross sales to determine total revenue, assessing operational efficiency to understand profit margins, and accounting for franchisor fees and additional expenses such as rent, utilities, and payroll. Effective management of these factors can significantly impact the profitability and financial success of a Fastest Labs franchise owner. This comprehensive financial analysis helps estimate net profits, from which the owner’s salary can be derived. A clear understanding of these factors ensures accurate salary projections and financial planning for sustainable business operations.
Fastest Labs Revenue & Gross Sales
Fastest Labs has demonstrated strong financial performance recently, with median gross sales reaching $150,966. This figure highlights the franchise’s solid market presence in the drug and alcohol testing industry.
Which key factors impact the average revenue performance of Fastest Labs franchisees?
Several factors likely contribute to the strong performance of U.S. franchisee median gross sales for Fastest Labs. The franchise’s commitment to clean, state-of-the-art facilities and exceptional customer service enhances its reputation and attracts a steady stream of clients. The growing demand for reliable drug, alcohol, and DNA testing services across various industries, including corporate and individual needs, also drives revenue. Additionally, Fastest Labs’ robust franchise support system and comprehensive training programs empower franchisees to operate efficiently and maintain high standards, further boosting sales performance. Their expanding network of locations across multiple states also helps in increasing brand visibility and accessibility, contributing to overall financial success.
Fastest Labs Franchise Operational Costs
When opening a Fastest Labs franchise, it’s essential to understand the ongoing operational costs that directly impact day-to-day operations. These are the expenses that keep the business running smoothly and ensure high-quality service delivery. Here’s a breakdown of the key operational costs to consider:
- Labor Costs This includes salaries for any staff required to manage daily testing operations, customer service, and administrative tasks.
- Testing Supplies and Equipment Ongoing replenishment of testing kits, lab materials, and maintenance of equipment will be a continuous expense.
- Rent and Utilities The cost of leasing or owning your lab space, along with utilities like electricity, water, and internet services.
- Insurance Liability insurance and other business-related coverage are essential to protect against potential legal or financial risks.
Understanding these costs will help you maintain a profitable and well-managed franchise while delivering the quality service Fastest Labs is known for.
Fastest Labs Franchise Fees
When considering opening a Fastest Labs franchise, it’s crucial to factor in the ongoing fees that support the brand’s operations and marketing efforts. These fees contribute to maintaining brand standards, ensuring franchisee support, and enhancing overall business performance.
- Royalty Fee Franchisees pay either 7% of their gross revenue or a minimum royalty amount, whichever is greater. This fee supports the ongoing use of the franchise’s brand and operational systems.
- National Brand Fund A 2% fee on monthly gross revenue is allocated to the National Brand Fund, which supports national marketing campaigns and brand-building activities.
- Additional Fees There are additional fees for training programs, technology, and other items provided by Fastest Labs that may be applied.
Understanding these fees will help you accurately budget for the financial requirements of operating a Fastest Labs franchise while benefiting from the support and brand recognition provided by the franchise system.
Fastest Labs Franchise Earnings
The earnings of a Fastest Labs franchise owner can vary based on factors such as location, market demand, and operational efficiency. However, with median gross sales around $150,966, owner-operators typically see estimated earnings of approximately $27,000. This translates to an operating profit margin of about 18%. Such figures suggest that effective management and cost control can lead to a favorable income.
However, it does appear that there is significant variability in terms of gross sales for locations depending on how active and involved the owner is. With dedicated effort and strategic operations, Fastest Labs franchise owners can achieve substantial returns and leverage the franchise’s established brand and support system to drive success.
How to Open a Fastest Labs Franchise
Embarking on the journey to become a Fastest Labs franchisee involves several important steps, from initial inquiry to the commencement of operations. Here’s a step-by-step overview of the process:
- Initial Inquiry You or your franchise specialist submits an initial inquiry basic information about your interest and background. You should also conduct thorough research on the franchise, including seeing all of the information available on the Vetted Biz franchise intelligence platform, including access to the most recent Franchise Disclosure Document (FDD).
- Franchise Application Complete and submit a franchise application form. This helps the franchisor assess your suitability and qualifications as a potential franchisee.
- Discovery Day Attend a Discovery Day or similar event where you can meet with the franchisor, tour existing locations, and learn more about the business model, support system, and culture.
- Financial Review Provide detailed financial information for review. This will include your liquid assets, net worth, and any other financial documentation required to ensure you meet the financial requirements.
- Franchise Agreement Review and sign the Franchise Agreement, which outlines the terms and conditions of the franchise relationship, including fees, obligations, and operational guidelines.
- Training Program Participate in the franchisor’s training program, which covers operational procedures, management practices, and use of technology. This training ensures you’re well-prepared to run your franchise effectively.
- Site Selection and Build-Out Work with the franchisor to select a suitable location for your franchise. Once selected, proceed with site build-out and any necessary renovations to align with Fastest Labs’ specifications.
- Pre-Opening Support Receive pre-opening support from the franchisor, including marketing materials, operational setup assistance, and guidance on launching your business.
- Grand Opening Execute a grand opening event to introduce your Fastest Labs location to the community and attract initial customers.
- Start of Operations Begin day-to-day operations of your Fastest Labs franchise, following the established procedures and continuing to receive support from the franchisor as you grow your business.
Pros & Cons
Pros
Growing Market Demand: With increasing demand for drug, alcohol, and DNA testing across industries, Fastest Labs taps into a stable and expanding market.
Lower Startup Costs: Compared to many other franchises, Fastest Labs offers a relatively low total investment, making it more accessible to entrepreneurs.
Scalable Business: With over 180 locations and a recent 99% unit growth, the franchise shows significant potential for expansion and long-term profitability.
Cons
Niche Industry: While profitable, drug and DNA testing is a specialized service that may not appeal to every investor or location.
Hands-On Management: Success is more likely with active, day-to-day involvement from the owner, which may not suit those looking for a more passive investment.
Competitive Market: The testing industry has strong competitors, including larger medical labs and independent operators, which may impact local market share.
