Valvoline Instant Oil Change Franchise Costs, Fees & FDD

Year Business Began: 1986

Franchising Since: 1988

Headquarters: Lexington, Kentucky

Estimated Number of Units: 1,810

Franchise Description: The franchisor is Valvoline Instant Oil Change Franchising, Inc. (VIOCF). Franchisees operate a Valvoline Instant Oil Change service center, a quick-service engine oil change facility which offers chassis lubrication, certain routine maintenance checks and other automotive services.
Training Overview: The franchisor conducts training programs for both franchisees and some of their employees. The training program will include four segments: VIOCF’s Real Estate & Development Orientation (1 day of orientation and 1-3 days of site visits once a site is identified), business training and center management training (approximately 3 days of classroom instruction and approximately 3 days of on-the-job training), VIOCF’s Operations Training (a combination of classroom instruction and approximately 20 days of on-the-job training), and VIOCF’s Center Opening Training (the exact duration and timing of center opening training will depend on the franchisee’s preparation). Approximately 3-6 months after the franchisee’s first center opens, an operations representative will return to the center and provide the franchisor’s Follow-Up Training. In addition to the required training programs outlined, the franchisor will provide additional training or assistance to franchisees at their request. Other scheduled optional training classes will be offered at no cost other than the franchisee’s own expenses for travel, lodging, meals, and any other expenses (including wages) the franchisee incurs.

Territory Granted: The License Agreement designates an approved location, if the site is known, or a site selection area for the center, if the site is unknown, when franchisees sign the License Agreement. It also designates a two-mile radius from the most central point of the approved location where the franchisor agrees not to establish or operate a center under the system and the proprietary marks. Once franchisees have established the center, the approved location and the two-mile radius surrounding it will be considered the territory where the franchisor agrees not to establish or operate a center under the system and the proprietary marks. The territory may be altered if the center is relocated or if centers are acquired through an acquisition, as described by the franchisor.

Obligations and Restrictions: The License Agreement requires franchisees or their designee to devote full time, energy, and best efforts to the management of the center(s). Franchisees may designate someone to act as the on-site manager of their initial center and subsequent centers. The manager must successfully complete the manager training program, including the SuperPro training program. The manager is not required to have an ownership interest in the licensed business. Any principal with a 5% or greater ownership interest in the business and certain people related to franchisees may be required to sign a consent to the License Agreement transaction and/or covenants of confidentiality and non-competition and to personally guarantee the performance of the business. Franchisees are required to restrict their activities to the operation of the center and they may not use the premises for any purpose other than a center, unless they have first obtained the franchisor’s written consent. Franchisees must keep the center open and in operation for the minimum number of days and times required by the franchisor. The center must operate strictly within the guidelines set by the franchisor.

Term of Agreement and Renewal: The length of the initial franchise term is 15 years. For renewal, franchisees have the option of two consecutive terms of five years each, one 10-year term or one 15-year term, if requirements are met.

Financial Assistance: The franchisor may offer to lease to franchisees signs and equipment required to be displayed at the center. The franchisor also has a financing program with a third-party lender, Bank of America, by which a qualified borrower may finance certain expenses incurred in connection with new and existing centers. The amount financed by Bank of America depends upon a number of factors, including the assets franchisees will purchase or lease and their credit worthiness. From time to time, the franchisor offers incentive programs to certain franchisees and area developers on an individual, per center basis. Qualifying new or existing franchisees may receive an incentive to construct and open new ground-up centers and/or to refurbish and open new conversion centers. From time to time, the franchisor may also offer incentives to eligible area developers.

Estimated Initial Investment

Name of Fee	Low	High
License Fee	$30,000	$30,000
Land and Improvements Purchased -or- Land and Improvements Leased for Three Months	$1,550,000 $12,500	$2,750,000 $24,500
Grand Opening Expenses and Advertising	$7,500	$10,000
Training	$5,000	$10,000
Security Deposits	$500	$11,500
Insurance	$10,000	$15,000
Start-Up Supplies	$22,000	$30,000
Initial Inventory of Valvoline Products	$28,750	$62,050
Equipment and Service Systems	$10,000	$350,000
Signage Leased for Three Months -or- Signage Purchased	$1,125  $45,000	$1,150  $120,000
Point-of-Sale System	$15,000	$30,000
Additional Funds for Three Months	$50,000	$65,000
ESTIMATED TOTAL: If Real Property Leased (3 Mos) and Signage Leased	$192,375	$639,550
ESTIMATED TOTAL: If Real Property Purchased and Signage Purchased	$1,773,750	$3,483,550

 
Other Fees

Type of Fee	Amount
Royalties	For the first 12 months of the initial term, 2% of adjusted gross revenue (AGR); for the second 12 months of the initial term, 3% of AGR, then 6% of AGR or a graduated royalty rate between 4% and 6% of AGR.
General System Fund	Up to 2% of AGR for that fiscal year until the cap amount has been reached.
Local Advertising Spend or Contribution	At least 3% of AGR annually based on a calendar year schedule.
National Advertising Fund	Not yet determined.
Regional Advertising Cooperatives	Not yet determined.
Transfer	$30,000 for the first center if transferred to a new franchisee; $5,000 for the first center if transferred to an existing franchisee; and $2,500 for any additional centers transferred in the same transaction.
Renewal	$2,500 - $5,000
Specialized Computer Services	$50 to $300 per hour as needed.
Computer Hardware Upgrade	Varies, costs may range from $150 - $15,000.
Product Testing and Product Suppliers	Cost of testing.
Audit	Cost of inspection or audit.
Interest	Lesser of 1.5% per month or highest commercial contract interest rate law allows.
Insurance	Reimburse the franchisor’s costs.
Insufficient Funds Processing Fee	Cost incurred by the franchisor or its affiliate.
Costs and Attorneys’ Fees	Will vary under circumstances.
Center Upgrading Costs	The greater of 2% of AGR during the previous five year period or $50,000 per center.
Fleet Program	Recapture third-party costs.
Warranty & Guarantee Costs	Varies, depending on amount of customer claim.
Additional Mandatory and/or Optional Training Costs	Varies.
Ongoing Purchases of Valvoline Products	Varies.
Signage Lease	Varies depending on cost of sign package and length of lease term.
Indemnification of the franchisor and its Affiliates for Expenses of Claims	The amount of all losses and expenses incurred by the franchisor and/or its affiliates in connection with legal actions arising out of the franchisee’s ownership and operation of the center(s).

The above information has been compiled from the FDD of Valvoline Instant Oil Change. Year of FDD: 2024.

Franchise Direct's Disclaimer