Winmark Corporation
Winmark Corp. is a U.S.-based franchisor of resale retail concepts, including Plato’s Closet, Once Upon A Child, Play It Again Sports, Style Encore, and Music Go Round. The company’s model centers on franchising, brand support, and centralized buying services for franchisees across the United States and Canada.
Fiscal year 2025 · change from previous year
Development 2020–2025
Business
Share of revenueRecurring royalties collected from franchisees based on store sales.
Fees collected when new franchise agreements are signed and stores open.
Buying support and limited billing/credit services for franchisees.
Miscellaneous franchise support and other operating income items.
Products
Reported · share of revenue- Royalty89.1 %
- Products3.8 %
- Other2.6 %
- Marketing Fees2.2 %
- Franchise1.8 %
- Software License Fees0.5 %
Source: 10-K FY2025, revenue the company reports per product line (SEC XBRL). Shares are of the lines shown and add up to 100 %.
Customers
Winmark’s direct customers are franchisees that operate its resale store brands, while the end consumers are shoppers and sellers of used goods. Franchisees buy the company’s brand system, operating model, and support because it helps them open and run local resale stores under established concepts. The resale formats appeal to value-oriented consumers seeking affordable clothing, sporting goods, toys, and musical instruments.
Independent owners who buy Winmark franchise rights, pay royalties, and use the operating system to run stores.
Entrepreneurs evaluating new territories and initial franchise agreements.
Shoppers and sellers using the stores for affordable apparel, kids' items, sports gear, and music products.
Franchise operators in Canada that contribute a smaller but disclosed portion of revenue.
Strategy
Winmark’s strategy is to expand its franchise system while supporting existing franchisees so they can grow store-level sales and renew agreements. The company also emphasizes operational consistency through centralized buying, technology support, and brand management across its resale concepts. Its model is designed to produce recurring royalty revenue from a broad base of independently owned stores.
More operating stores increase royalty and fee opportunities.
Renewals preserve the installed base that generates recurring royalties.
A reliable POS platform is central to store operations and system control.
Geography
Winmark’s business is concentrated in the United States, where it generates the majority of revenue and where its significant assets are located. It also operates in Canada through franchisees, with disclosed Canadian franchise revenue representing a small portion of total revenue. The company’s franchise footprint spans both countries, but the U.S. market is the core operating base.
Risks
Winmark depends on franchisee performance, renewal activity, and the stability of its required store technology, so weakness in any of those areas can affect royalty revenue. The business also faces regulatory, cybersecurity, and competitive risks typical of franchisors and retail concepts. Because the company relies on a franchise model rather than company-owned stores, operational issues at franchisees can still flow back into brand health and system economics.
- Franchise regulation and labor law changesImpact: HighLikelihood: Medium
More disclosure or liability rules could increase costs and burden the franchise model.
Exposure: U.S. federal and state franchise laws
- Required POS system disruptionImpact: HighLikelihood: Medium
Franchisees rely on a common POS platform for store operations and reporting.
Exposure: System modernization and third-party vendor dependence
- Data security breachImpact: HighLikelihood: Low
Unauthorized access could cause legal claims, reputational damage, and remediation costs.
Exposure - Franchisee renewal and store closure riskImpact: MediumLikelihood: Medium
The royalty base depends on keeping existing stores open and renewing agreements.
Exposure: 10-year franchise agreements
- Competitive retail environmentImpact: MediumLikelihood: Medium
Alternative resale and value retail concepts can pressure franchise growth and sales.
Exposure: Resale and specialty retail
Accounting
Judgemental itemsRoyalties are earned as a percentage of franchisee sales, so reported revenue depends on franchisee reporting and period cut-off.
Impact: Affects recurring revenue timing and receivables
Initial fees are recognized over the estimated life of the franchise rather than upfront.
Impact: Creates deferred revenue liability and smooths revenue
Plato’s Closet and Once Upon A Child are stronger in spring and back-to-school periods, while Play It Again Sports is stronger in winter.
Impact: Quarterly revenue and margin comparability
The company previously had leasing operations that were wound down, with settlement-related income affecting results.
Impact: Non-core income and one-time items
Borrowings and note agreements require monitoring of principal, interest, and covenant-related obligations.
Impact: Balance sheet leverage and cash flow analysis
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Last updated: 24/09/2026