Jiffy Lube Franchise Cost & Fees
Date of Incorporation: 1979
Franchising Since: 1995
Headquarters: Houston, Texas
Business Description: The franchisor is Jiffy Lube International, Inc., a wholly owned subsidiary of Pennzoil-Quaker State Company. Jiffy Lube service centers oil change and lubrication services for cars and light trucks, as well as light repair services and other similar or ancillary products and services, some of which the franchisor requires to be offered and some of which are approved, but optional.
Franchise Offer: Franchisees will be required to strictly comply with the Franchise Agreement and the Policies and Procedures Manual, which together will govern the relationship.
Financial Assistance: The franchisor offers the following financial assistance options. Except for the Mt. Pleasant UNL program (#2), Jiffy Lube does not offer direct or indirect financing.
- Jiffy Lube has developed a relationship with FranFund, Inc. a loan broker, who is available to assist franchisees with navigating the lending process. Franchisees desiring to use FranFund will contract directly with FranFund for their loan brokerage needs. Utilizing FranFund’s services is optional for all franchisees.
- SOPUS Products, parent company of Jiffy Lube, offers several financing programs for its customers, including Jiffy Lube franchisees.
Training and Assistance: Before the opening of the franchised service center, the franchisee, or day-to-day decision makers (i.e., manager or delegate), of the franchised service center and, in the case of a corporation, the officers responsible for the operation of the franchised service center, must successfully complete the franchisee operations training program. The intent of this training course is to provide the franchisee and his/her decision-maker(s) with a solid understanding of the Operations (J-Team Service Standards) as they relate to the Brand and Customer Value Proposition. While the franchised business is operating, the franchisor will continue to offer management training courses for service center managers, or managers who replace the franchisee or the initial manager at the service center. Franchisees and their managers must attend training every five years. The franchisor may require additional, ongoing training of service center managers and employees.
Territory: Subject to any rights Jiffy Lube has already granted to other franchisees, without the franchisee’s consent the franchisor will not permit another franchisee to open a Jiffy Lube service center within three miles of the service center; or establish or operate a Jiffy Lube service center, within three miles of the service center. Jiffy Lube can license another franchisee to open a Jiffy Lube service center or establish or operate a service center at any location outside of a three-mile ring; the franchisee won't have any rights of first refusal or similar rights to acquire a new franchise outside of the three-mile ring.
Term of Agreement and Renewal: The length of the term of the franchise agreement is 20 years. Renewal or extension of the term is available for one 10-year term.
Obligations and Restrictions: A franchised Jiffy Lube service center must be under the personal supervision of franchisee, or under the personal supervision of a manager who has successfully completed the operations training course. The franchisees cannot sell or offer to perform any product or services that would detract from the Jiffy Lube concept. That is, the franchisee cannot offer major engine overhauls, transmission overhauls, muffler installation, automobile painting, or any other services that are not related to the services approved by Jiffy Lube. The franchisee cannot sell or offer to perform a lube-only service, or a lube-oil-filter only service, or an oil and filter only service other than as approved under the VOCP service. The franchisee cannot sell any automobile parts or supplies that are not related to the services Jiffy Lube offers, or any non-automobile related products or services, unless the parts or supplies or products or services are approved.
Estimated Number of Units: 2,085
|Name of Fee||Low||High|
|Initial Franchise Fee||$0||$35,000|
|First Month's Rent and Security Deposit||$8,000||$20,000|
|Equipment, Signs and Fixtures||$120,000||$225,000|
|Opening Marketing Expense||$15,000||$20,000|
|Training expenses incurred by franchisee or employees (does not include wages or salaries of attendees)||$1,000||$5,000|
|Additional Funds (working capital) - 6 months||$45,000||$45,000|
|Type of Fee||Amount|
|Royalty||Under the Non-Product Supply Franchise Agreement, 5% (or 4% of Gross Sales if the franchisee pays the Royalty on or before the due date).
Under the Product Supply Franchise Agreement, for new-to-system locations (either conversion sites or new build locations),
|Remedial Expenses||An amount that Jiffy Lube specifies if the franchisee has breached a provision of the Franchise Agreement and such breach results in harm to the Jiffy Lube brand or the franchisor or other Jiffy Lube franchisees.|
|POS Support Charge||The then-current fee, which will not exceed $160 per month per POS System installed, unless approved by TSAB or required under contract with Jiffy Lube’s POS System support provider that has been approved by the franchisor and the TSAB.|
|Hardware Support||Currently $68 per month (prices are subject to change on 30 days’ notice upon the approval of TSAB).|
|Data Delivery Service (optional)||Monthly fee based on the number of stores operated by the franchisee (currently $200 for 1 to 25 stores, $400 for 26 to 99 stores, or $850 for >99 stores) plus operational and maintenance expenses.|
|Training Expenses||Expenses Jiffy Lube incurs when it offers training for franchisees or their managers; this does not include wages or salaries of attendees, which the franchisee is responsible for.|
|Product Testing Expense||Expenses Jiffy Lube incurs in testing a product the franchisee wants to use, but which Jiffy Lube hasn’t included in a list of similar products that meet standards.|
|Fleet Processing Charge||An amount Jiffy Lube may specify at times during the term of the Franchise Agreement. Currently $0.50 per fleet invoice where automatically approved by the Auto Integrate fleet invoice verification program.|
|Brakes & Services National Warranty Program||$7.00 per month.|
|Audit Expenses||Expenses Jiffy Lube incurs in the course of auditing the franchisee’s books or financial records.|
|Service Charges||The lesser of (a) 2% per month or (b) the highest rate permitted on all past due amounts.|
|Transfer Fee||$3,500 plus Jiffy Lube’s actual expenses.|
|Renewal Fee||$10,000 for the renewal term, subject to adjustment using the Consumer Price Index (utilizing 1982-84 = 100 as a base year).|
|National Advertising Fund (the “Ad Fund”) Contributions||1.5% of Gross Sales under the Product Supply Franchise Agreement; Not applicable to franchisees operating under a Non-Product Supply Franchise Agreement.|
|Cooperative Advertising||Under the Non-Product Supply Franchise Agreement, 5% of Gross Sales;
Under the Product Supply Franchise Agreement, 2,5% of Gross Sales if the franchisee must contribute to the Ad Fund.
|Local Advertising||5% of Gross Sales; 4% if the franchisee signs the Product Supply Franchise Agreement.|
The above information has been taken from the FDD of Jiffy Lube. Year of FDD: 2016
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