Dealer program or franchise? How to tell which fits you.
Both let you grow a home services business with a bigger name behind you. They work very differently. A franchise puts its brand and system on your business. A dealer program adds a manufacturer's product to the business you already run, under your own name.
By ServiceStake Research · Updated October 5, 2026 · 7 min read
Their brand, or yours.
You run their business model.
You buy the right to use the franchisor's name, system and support. You pay a franchise fee to start and royalties for as long as the agreement runs. In return you get a known brand and a playbook.
You add their product to your business.
A manufacturer authorizes you to sell and install its product under your own company name. There's usually no royalty. You earn your margin on the product, and you keep the rest of your business as it is.
How they compare, line by line.
| Franchise | Dealer program | |
|---|---|---|
| Whose name is on the truck | The franchisor's brand. | Yours. You add the manufacturer's product, and often its "authorized dealer" mark. |
| Upfront cost | A published initial investment. Across 191 home services franchises the median starting figure is $135,135, with a median franchise fee of $55,000. | No standard disclosure. Costs vary by program and can include training or certification, demo units, starting inventory and software. Ask each program. |
| Ongoing fees | Royalties, a brand marketing fund and technology fees, usually a share of revenue, for the life of the agreement. | Usually no royalty. You typically earn your margin on the product you buy and install. Some programs charge for leads, software or co-op marketing. |
| Disclosure before you sign | A franchise disclosure document (FDD), which by U.S. federal rule must reach you at least 14 days before you sign or pay. | Usually no FDD. You get a dealer or distribution agreement. Read it closely. |
| How much they control | A full operating system: how you sell, price, market and run the business. | Mostly product standards: how you sell, install and service their product. The rest of your business stays yours. |
| Commitment | Usually a multi-year term with renewal, transfer and non-compete rules. | Often shorter or renewable. Check the term, termination and any minimum purchase requirements. |
| Best fit | Someone starting fresh who wants a proven brand and playbook. | An existing contractor with a crew, licenses and customers who wants another product line. |
Whose name is on the truck
The franchisor's brand.
Yours. You add the manufacturer's product, and often its "authorized dealer" mark.
Upfront cost
A published initial investment. Across 191 home services franchises the median starting figure is $135,135, with a median franchise fee of $55,000.
No standard disclosure. Costs vary by program and can include training or certification, demo units, starting inventory and software. Ask each program.
Ongoing fees
Royalties, a brand marketing fund and technology fees, usually a share of revenue, for the life of the agreement.
Usually no royalty. You typically earn your margin on the product you buy and install. Some programs charge for leads, software or co-op marketing.
Disclosure before you sign
A franchise disclosure document (FDD), which by U.S. federal rule must reach you at least 14 days before you sign or pay.
Usually no FDD. You get a dealer or distribution agreement. Read it closely.
How much they control
A full operating system: how you sell, price, market and run the business.
Mostly product standards: how you sell, install and service their product. The rest of your business stays yours.
Commitment
Usually a multi-year term with renewal, transfer and non-compete rules.
Often shorter or renewable. Check the term, termination and any minimum purchase requirements.
Best fit
Someone starting fresh who wants a proven brand and playbook.
An existing contractor with a crew, licenses and customers who wants another product line.
Typical terms. Every agreement is different, so read the one in front of you. Trade press for remodelers describes the same split: dealerships are lighter, shorter commitments built around product, while franchises are longer, regulated agreements built around a brand and system (JLC).
Start from what you already have.
A franchise usually fits if you
- are starting fresh or changing careers
- want a known brand customers already trust
- want a step-by-step system, training and marketing
- are comfortable paying ongoing royalties for that support
A dealer program usually fits if you
- already run a crew with licenses and insurance
- have customers and a name in your area
- want to add a product line, not a new brand
- want to keep control of how you run your company
34 dealer programs across 16 trades.
Dealer programs cluster in product-heavy trades. Docks & Boat Lifts and Water Treatment have dealer programs but no franchises on ServiceStake.
Eight questions to ask any dealer program.
Dealer programs don't publish a standard disclosure, so you have to ask. Get the answers in writing.
What do I pay up front?
Training, certification, demo units, starting inventory, software and any sign-up fee.
Are there minimum purchases?
Monthly or yearly volume targets, and what happens if you miss them.
Is my area protected?
Whether other dealers can sell the same line near you.
Do you send me leads?
How leads are shared, whether you pay for them, and how fast you must respond.
Who sets the price?
Your margin, any minimum advertised price, and financing options for your customers.
What are my warranty duties?
Who covers labor on warranty claims and how service calls are paid.
How do I get out?
The term, renewal, termination terms, and what happens to inventory if you leave.
Can I carry other brands?
Whether you can sell competing lines alongside this one.
When a “dealer program” is really a franchise.
Under the U.S. Federal Trade Commission's Franchise Rule, a deal is a franchise when three things are all true: you operate under the company's brand, the company has significant control over or gives significant help with how you run your business, and you're required to pay it a fee. The label doesn't matter. If all three apply, the company owes you a franchise disclosure document at least 14 days before you sign or pay.
If an offer looks like that, ask why there's no FDD and have a franchise attorney review it. Background: FindLaw on hidden franchises, FTC consumer guide to buying a franchise.
Frequently asked questions.
What is the difference between a dealer program and a franchise?
A franchise lets you run a business under the franchisor's brand and system, in return for a franchise fee and ongoing royalties. A dealer program lets a business sell and install a manufacturer's products under its own name, usually without a royalty.
Is a dealer program cheaper than a franchise?
Often, because there is usually no franchise fee or royalty. But dealer programs don't publish standard cost disclosures, so costs like training, inventory, demo units and minimum purchases vary. For comparison, the median home services franchise fee on ServiceStake is $55,000.
Do dealer programs have to give me an FDD?
Usually not. A franchise disclosure document is required for franchises. But if a so-called dealer program uses its brand on your business, controls how you operate and requires a fee, it may legally be a franchise, and it would then owe you an FDD at least 14 days before you sign or pay.
Who should choose a dealer program?
Usually an existing contractor with a crew, licenses and customers who wants to add a product line without changing the company name.
How many dealer programs are on ServiceStake?
34 dealer programs across 16 trades, listed separately from 295 franchises.
About this guide.
Counts come from ServiceStake's listings: 295 home services franchises and 34 dealer programs, each checked against the brand's own website or a state filing. Franchise cost figures are from our franchise cost guide.
The comparison describes typical arrangements, not any one company's terms. It isn't legal or financial advice. Have a franchise attorney review any agreement before you sign.