Management Recruiters Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Management Recruiters, part of MRINetwork, is an executive-recruiting franchise placing mid- to senior-level management candidates with corporate clients. Franchisees run a search firm sourcing and screening candidates and earning placement fees.
FranchiseVerdict summary · 2026
A Management Recruiters franchise requires a total initial investment of $44K – $96K, including a $40K franchise fee and an ongoing 9.0% royalty[2]. The 2023 FDD does not disclose unit-level revenue (no Item 19). SBA 7(a) loans show a 10.0% charge-off rate across 94 loans[1]. FranchiseVerdict grade: D (Below average), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2023 FDD issuance
Overview
- Investment
- $44K – $96K
- 10th pct Business Serv…
- Avg gross sales
- N/A
- 30th pct Business Serv…
- Royalty
- 9.0%
- 26th pct Business Serv…
- Units
- 203
- 50th pct Business Serv…
- SBA charge-off
- 10.0%
- % of SBA 7(a) loans not repaid · median varies by category
Quick verdict · Business Services · color = vs category peers
Green = favorable by >10% vs Business Services avg · No shading = within ±10% · Red = unfavorable by >10% · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Bottom line
- Total investment $44K – $96K including a $40K franchise fee, 9.0% ongoing royalty.
- Audited financials are those of HireQuest, Inc., the publicly-traded parent and guarantor of the franchisor (HQ MRI Corporation is a wholly owned subsidiary). Figures are for FY ended Dec 31, 2022 (most recent) and 2021, in thousands. Audited by Plante & Moran, PLLC (auditor since 2017); FY2020 and unaudited Q3 2023 also attached.
- Verdict D (Below average), verdict score 38/100 (higher is better). SBA loan charge-off rate of 10.0% across 94 loans (near or below the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
- System contracting at -23.4% CAGR over 3 years. Investigate whether closures are franchisor-driven (consolidation) or franchisee-driven (economics).
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- HQ MRI Corporation
- Parent company
- HireQuest, Inc.
- Predecessor
- Management Recruiters International, Inc.
- Prior franchisor entity
- CEO title
- President and CEO
- Richard F. Hermanns
- Incorporated in
- DE
- HQ
- 111 Springhall Drive, Goose Creek, SC 29445
- Auditor
- Plante & Moran, PLLC
- Audited financials
- Franchisor revenue
- $31.0M
- vs $22.5M prior year
Affiliated brands
- Michelin North America
Other brands the franchisor or its parent operates (Item 1).
Overview
About
- CEO
- Richard F. Hermanns
- Headquarters
- SC
- Founded
- 2021
- FDD year
- 2023
- States available
- 42
Can you afford it, and what does the money buy?
Entry cost runs 74% below the typical business services franchise.
Source: FDD 2023 · Items 5–7
Full Item 7 breakdown18 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Feenot refundable | $40K | $40K | |
| Real Estate and Improvements | $0 | $2K | |
| Computer Hardware | $0 | $5K | |
| Applicant Tracking System | $900 | $2K | |
| Online Recruiting Software | $1K | $6K | |
| Cabling for Office | $0 | $2K | |
| Internet | $0 | $300 | |
| Office Furniture | $0 | $3K | |
| Licensing Fees | $0 | $300 | |
| Initial Office Supplies | $300 | $500 | |
| Business Insurance | $2K | $2K | |
| Professional Services | $0 | $3K | |
| Miscellaneous | $0 | $500 | |
| Salaries: Researcher | $0 | $6K | |
| Salaries: Account Executive | $0 | $9K | |
| Salaries: Project Coordinator | $0 | $9K | |
| Printer (all in one) | $0 | $150 | |
| Additional Funds (3 months) | $0 | $6K | |
| Total initial investment | $44K | $96K |
Line items extracted from FDD Item 7. Ranges reflect the franchisor's stated low and high per line. Total is the sum of line-item lows / highs — actual costs may fall outside this range depending on market and build-out scope.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $44K – $96K
- Top 40% of category vs category
- Liquid capital req'd
- $0 – $6K
- Top 40% of category vs category
- Franchise fee
- $40K – $40K
- Top 40% of category vs category
- Royalty
- 9.0%
- tiered · typical 6–8%
- Ad fund
- 0.5%
- typical 3–5%
- Total fee load
- 9.5%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 9.0% of gross sales |
| Marketing / ad fund | 0.5% of gross sales |
| Transfer fee | $5K |
| Renewal fee | $0 |
| Inventory (initial) | $85K – $500K |
| Total fee load | 9.5% of rev |
What do units actually make?
Source: FDD 2023 · Item 19
Financial Performance
Audited financials are those of HireQuest, Inc., the publicly-traded parent and guarantor of the franchisor (HQ MRI Corporation is a wholly owned subsidiary). Figures are for FY ended Dec 31, 2022 (most recent) and 2021, in thousands. Audited by Plante & Moran, PLLC (auditor since 2017); FY2020 and unaudited Q3 2023 also attached.
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Fee burden
Total ongoing fee load of 9.5% — below the Business Services average of 11.9%.
Disclosure
Item 19 reports "placement_fees_and_commissions" rather than annual gross sales. Not directly comparable across brands.
Operator retention
System contracting at -23.4% CAGR over 3 years. Investigate whether closures are franchisor-driven consolidation or franchisee exits.
Source: FDD Item 19 financial performance representations and publicly filed FDD data. Past performance is not indicative of future results. Verify all figures with the franchisor and current franchisees before making any investment decision.
vs Business Services averages
How Management Recruiters Compares
Is the system healthy?
Source: FDD 2023 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 203
- Opened
- 6
- Last reporting year
- Closed
- 49
- Terminated
- 3
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 11
- Term expired, not renewed (per Item 20)
- Turnover rate
- 24.1%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (3-yr)
- -23.4%
- Net unit change over 3 years
- 3-yr CAGR
- -23.4%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 6
- Closed (3yr)
- 25
- Terminated (3yr)
- 4
- Non-renewed (3yr)
- 20
- Transfers (3yr)
- 2
- Reacquired (3yr)
- 0
- Franchisor bought back
- Transfer rate
- 1.0%
- Owners selling to other franchisees
- Termination rate
- 6.9%
- Franchisor-initiated terminations
- Ceased ops
- 23.1%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 41 states with active franchisees
The Territory Map
Derived from franchisee contact records. Shows states with at least one current operator. Not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).
States derived from franchisee contact records (FDD Item 20). Shows states with at least one current operator on file. Full state registration data (Item 12) will appear on a future FDD refresh.
A system losing more than 10% of its units year-over-year is a red flag. Check whether closures are concentrated in specific regions.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 94
- Loan volume
- $16.8M
- Median loan
- $80K
- 50th percentile
- Charge-off rate
- 10.0%
- rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- 88.7%
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 38
- Defaults
- 8
- Typical loan rate
- 6.5%
- avg rate to borrowers
- vs industry
- 11.3%
- brand is below its industry ↓
- Jobs supported
- 627
- 4.4 per loan
- Lender concentration
- 18%
- top lender's share
Borrower mix: 0% went to startups / new businesses, 100% to established operators
Vintage analysis
Management Recruiters charge-off rate by loan vintage
Top lenders financing Management Recruiters franchisees
Showing 3 of 38 lenders. The full breakdown — every lender, state distribution, interest rates & risk ratings — is in the SBA Lending Report below.
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Management Recruiters's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 10 lenders with concentration factor
- Per-state charge-off rates across 15 states
- Startup risk premium and job creation velocity
- 24-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
What could kill this investment?
SBA loans charge off at 10.0% — 38% below the 16.0% national norm, i.e. lower lender-observed risk.
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
Contracting franchise system with alarming unit decline, undisclosed profitability, extremely low average revenues, unprotected territory, and prior franchisor litigation involving fund mismanagement present high-risk investment profile unsuitable for most investors.
Litigation (Item 3)
3 concluded cases involving predecessor franchisor Management Recruiters International, Inc.: breach of contract/royalty non-payment cases settled; largest settlement $300,000 received from Gre-ter Enterprises
Largest disclosed settlement: $300,000
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Plante & Moran, PLLC
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
ⓘ These are the parent company's consolidated financials (the parent guarantees the franchisor), not this brand's standalone results — the figure reflects the whole corporate group, not this brand alone.
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Kickbacks from required suppliers: No
- Restricted to system-approved products: Yes
Score breakdown · what drove the 38 / 100 verdict
- 01MEDUnit count declined 17.5% YoY (203 units) indicating system contraction and franchisee viability concerns
- 02MINORAverage revenue of $28,940.86 is extremely low for a staffing/recruitment franchise and suggests most units are underperforming
- 03MINORNo Item 19 (Net Income) disclosure prevents accurate ROI assessment and raises transparency concerns
- 04HIGHPredecessor franchisor litigation history includes $300,000 settlement for encroachment and fund mismanagement—material governance red flag
- 05MINORNo territory protection creates direct competition risk and race-to-bottom pricing dynamics among franchisees
- 06HIGHGoing Concern status of 'False' suggests franchisor financial instability or restructuring concerns
- 07MEDRoyalty structure on disclosed average revenue ($28,940) yields only $2,604 in annual royalties—unit economics appear unsustainable
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 9.5% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2023 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 5 years |
| Territory type | none |
| Protected territory | No |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Granted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 50 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Arbitration location | Berkeley County, South Carolina |
| Jury trial waiver | Yes |
| Governing law | SC |
| Litigation count | 3 |
View Item 3 litigation summary
3 concluded cases involving predecessor franchisor Management Recruiters International, Inc.: breach of contract/royalty non-payment cases settled; largest settlement $300,000 received from Gre-ter Enterprises
Items 10, 11
Training & Operations
- Classroom training
- 80 hrs
- On-the-job training
- 0 hrs
- Training location
- Virtual
- Ongoing training
- Required
- Time to open
- 3 mo
- From signing to launch
- Site selection
- franchisee with franchisor approval
- Franchisor financing
- Offered
- Item 10
- POS system
- Applicant Tracking System
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Applicant Tracking System
Item 20 · call current owners
Franchisee Contacts
187 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Management Recruiters · FDD (2023) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Management Recruiters franchise?
The total investment to open a Management Recruiters franchise ranges from $44K – $96K, with an initial franchise fee of $40K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Management Recruiters franchise owners earn?
Management Recruiters does not disclose average franchise owner earnings in their FDD Item 19. Not all franchisors are required to make financial performance representations. We recommend asking existing franchisees directly about their financial experience.
What is Management Recruiters's franchise failure rate?
Based on SBA 7(a) loan data, Management Recruiters has a charge-off rate of 10.0% across 94 loans, meaning 10.0% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many Management Recruiters franchise locations are there?
As of their most recent FDD filing, Management Recruiters has 203 total units in the United States, including 203 franchised units and 0 company-owned units. 6 new units were opened in the latest reporting year.
Is Management Recruiters a good franchise to buy?
FranchiseVerdict rates Management Recruiters as a D-grade franchise with a verdict score of 38 out of 100 (higher is better), based on our analysis of investment costs, revenue data, SBA loan performance, and growth trends. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
For franchisors
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.