Koala Insulation Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$189,075 - $234,272
Franchise Fee
$24,750
Total US Locations
395
Business Summary
Koala Insulation franchises operate businesses specializing in providing insulation evaluation, removal, and installation services. These businesses utilize a distinctive system and proprietary equipment, known as Koala Rigs, which include specialized trailers and installation equipment. Franchisees offer services for both residential and commercial facilities, competing with other insulation service providers in the market.
Corporate History
Koala Insulation Franchisor, LLC was formed in Delaware on March 30, 2023, and began offering Koala Insulation franchises in May 2023. The company acquired the Koala Insulation franchise system assets on April 13, 2023, from its predecessor, Koala Franchise, LLC. Koala Franchise, LLC, which started the Koala Insulation franchise system, was formed in Florida on January 2, 2020, and operated as the franchisor from January 21, 2020, until April 2023.
Financial Overview
Investment Range
$189,075 - $234,272
Franchise Fee (Low)
$24,750
Franchise Fee (High)
$49,500
Royalty %
6.5%
Marketing %
6%
Equipment Costs (Low)
$200,250
Equipment Costs (High)
$275,880
Working Capital
$50,000
Audited Financials
Yes
Offers Financing
Yes
Audit Opinion
Unqualified opinion
Financial Health Notes
Outdoor Living Brands Holdco, LLC, the parent company and guarantor of Koala Insulation Franchisor, LLC, appears to be in a strong financial position. The company has shown consistent growth in net income, with figures rising from $6.09 million in 2022 to $20.64 million in 2024. Cash balances have also increased year over year. The company maintains positive working capital, with current assets significantly exceeding current liabilities. The independent auditors issued an unqualified opinion, indicating the financial statements are presented fairly in all material respects, and did not raise any substantial doubt about the company's ability to continue as a going concern. The auditors did emphasize related party transactions and a change in accounting policy for income tax allocation, but these do not alter the unqualified opinion.
Financing Details
Koala Insulation Franchisor, LLC may, under limited and special circumstances, offer financing to qualifying existing franchisees. This financing can cover up to 80% of the franchise fee for up to 24 months. The annual interest rate for this financing will be 4 percentage points above the prime interest rate at the time the franchise agreement becomes effective. There are no prepayment penalties, and the Promissory Note includes a waiver of presentment for acceptance and payment, notice of dishonor, and protest of dishonor. If payments are late, a 10% late charge may be applied, or the entire balance may be declared immediately due, accruing interest at the maximum legal rate (not exceeding 18%) plus attorneys' fees and collection costs. The franchisor does not intend to sell or assign these financing documents to third parties. Aside from this specific franchise fee financing for existing franchisees, Koala Insulation Franchisor, LLC does not offer other direct or indirect financing and does not guarantee franchisee notes, leases, or obligations.
Performance Metrics
Total US Locations
395
Franchised Units
395
Corporate Units
0
Franchising Since
2023
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
Koala Insulation has no litigation to report. Item 3 of the FDD states that no litigation is required to be disclosed for the franchise.
Bankruptcy History
Koala Insulation has no bankruptcy history to report. Item 4 of the FDD states that no bankruptcy is required to be disclosed for the franchise.
Agreement Terms
Initial Term
10 years
Renewal Term
5 years
Renewal Conditions
To renew their franchise agreement, Koala Insulation franchisees must give written notice between six and twelve months before the initial term ends. They must also update, refurbish, or replace their Koala Rigs and any physical franchise location to meet current brand standards. All monetary and reporting obligations must be satisfied, and the franchisee must have continuously complied with all terms of the franchise agreement and operating standards. A general release of claims against the franchisor and its affiliates must be signed, and a new franchise agreement, which may have substantially different terms, must be executed. Franchisees are also required to pay a renewal fee equal to the greater of 25% of the Initial Franchise Fee or $5,000 per territory. Finally, the franchisee and their personnel must meet the franchisor's then-current qualification and training requirements.
Training & Support Program
Franchisor Assistance
Koala Insulation Franchisor, LLC provides franchisees with pre-opening and ongoing assistance. Before opening, the franchisor offers initial training for up to three individuals, typically the Operating Principal, Operations Manager, and Salesperson, at its headquarters or a designated location. Additional opening assistance can be provided upon request, for which the franchisee must reimburse expenses and pay a service fee. The franchisor also approves proposed physical sites if the franchisee chooses not to operate from a home office, and lends copies of the operations manuals. For ongoing support, Koala Insulation Franchisor, LLC makes additional training programs available, reviews and approves all promotional materials, and administers the Brand Fund for system-wide advertising. Franchisees also receive periodic assistance in marketing, management, and operations, and may opt for additional services like a call center or recruiting assistance for a fee. Franchisees are required to attend refresher training programs or seminars, including an annual conference, for which they pay a fee per person plus expenses.
Initial Training Hours
77
Training Location
Melbourne, Florida and franchisee's territory
Ongoing Support
Koala Insulation Franchisor, LLC provides continuous support services after opening. Franchisees have access to additional training programs and periodic assistance in marketing, management, and overall operations as determined by the franchisor. They must also contribute to a Brand Fund, currently 1% of gross sales, which is used for system-wide advertising, marketing, and promotional programs. Franchisees are also required to spend a minimum of $2,000 or 5% of gross sales monthly on local advertising, with allocations directed by the franchisor. There may also be optional services like a call center and recruiting assistance available for a fee. Franchisees are required to attend refresher training programs or seminars, including an annual conference, for which they pay a fee per person plus expenses.
Franchise Requirements
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Hybrid
Owner Participation
Supervisory
Territory Type
Protected
Territory Size Requirements
Koala Insulation franchisees receive a territory that is negotiated with the franchisor and specifically described in the franchise agreement. The minimum size for a Koala Insulation territory is approximately the area necessary to include 200,000 people. When defining a territory, the franchisor considers factors such as population, median household income, traffic flow, presence of businesses, location of competitors, and other demographic and market conditions.
Staffing Notes
Koala Insulation franchisees are required to maintain a competent, conscientious, and trained staff sufficient to promptly serve customers. Each insulation installation typically requires a minimum of one two-person crew. Franchisees must ensure all employees uphold good customer relations, follow performance guidelines in the Manuals, and comply with all applicable laws and regulations. The franchisor also requires that an Operations Manager and a Salesperson are appointed to manage the day-to-day business; these individuals, along with the Operating Principal, must successfully complete initial training. If an Operations Manager, Salesperson, or Operating Principal changes, the new appointee must also undergo and complete a certification training program. Franchisees are responsible for all labor costs, which vary based on local rates, availability of workers, the number of crews operated, and employee skill levels.