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Getting into the Cleaning Industry (2)

 Getting into the Cleaning IndustryCleaning report Image 1-1

Though independent operators can find success in the industry, franchises provide several advantages to entrepreneurs looking to enter the industry. Some of these advantages are: brand recognition, proven systems, and a proven record along with business and marketing support. For those considering entry into the cleaning industry, they need to assess their qualifications to see if they match up with those required in this field, which include (but are not limited to):

  • Basic business skills
  • Time management skills
  • Interpersonal skills
  • Service mentality
  • Skills specific to the cleaning area entered

“Undoubtedly, we want franchise prospects that have a motivation for becoming a business owner. Without a specific purpose, goal or objective we have found that the level of commitment often falls short after the initial novelty of operating a franchise wanes,” says Thompson. “Most small business owners have tremendous success when applying the principles taught by the franchisor and applied consistently over time. Too many prospects enter the business with unrealistic expectations which results in disillusionment and limits their degree of success.”

A special consideration to take into account when entering the cleaning industry is a background check. In many instances, assignments will expose cleaning industry workers to personal possessions or proprietary materials, oftentimes unattended. Virtually all reputable cleaning service providers perform these checks to increase their customers’ peace of mind about the people enlisted to provide service to them.

Monetarily, the range of investment costs in the cleaning industry can only be rivaled by the diversity of the number of companies that offer services in this area. The following table represents a small sample of the cleaning franchises available, illustrating some of the costs associated with running one. Please consult a specific franchise’s Franchise Disclosure Document (FDD) for detailed information on the investment costs for that franchise.

 

1-800-GOT-JUNK? (2008)
Initial Franchise Fee (for Single Unit) For A Franchise with 2 Subterritories:
$27,000
Estimated Initial Investment (Range) For A Franchise with 2 Subterritories:
$94,400-$122,400
Royalty 8% of Gross Revenue
Advertising/ Marketing Advertising /Promotions Fund: 1% of Gross Revenue;
Local Advertising: 5% of Gross Revenue quarterly; but not less than $3,600 per quarter during the first year of operations
Additional Training Payment for additional training or retraining at up to $ 100 per person per day for up to possibly 10 days
Transfer Fee $10,000

 

Chem-Dry (2010)
Initial Franchise Fee (for Single Unit) $10,950-$12,950
Estimated Initial Investment (Range) $25,600-$121,450
Royalty $350/month
Advertising/ Marketing At least 10% of Yearly Gross Revenue
Additional Training $0-$500 plus travel and living expenses
Transfer Fee $1,000-$4,000

 

College Hunks Hauling Junk (2008)
Initial Franchise Fee (for Single Unit) $25,000
Estimated Initial Investment (Range) $75,600- $120,600
Royalty 6% of Gross Sales or the minimum, whichever is higher. After the first 26 weeks of operation, the minimum biweekly fee will be $300 for the first Zone. If the franchisee owns 2 or more Zones, the first Zone fee will apply and after the first year of operation, the minimum biweekly fee will be $300 for each Zone.
Advertising/ Marketing Advertising (Regional and Local) ("RAF"): 1% of Gross Sales; Local Advertising: 6% of Gross Sales
Additional Training A per person fee will be determined by the franchisor for Additional Personnel Training and depends on the instructor's fee, travel, lodging, food and materials associated with the training topic.
Transfer Fee 75% of the Initial Franchise Fee payable under the then current Franchise Agreement for the entire Designated Territory

 

Heaven’s Best Carpet Cleaning (2008)
Initial Franchise Fee (for Single Unit) $28,900
Estimated Initial Investment (Range) $44,900-$65,900
Royalty $80.00 per month per licensed territory
Advertising/ Marketing No advertising fund exists at the present time;
Local advertising by the Subfranchisee is encouraged, but is at the sole discretion of the Subfranchisee
Additional Training The cost for training additional personnel will be $1,000 per person
Transfer Fee $500

 

Jan-Pro (2011)
Initial Franchise Fee (for Single Unit) $2,520-$44,000
Estimated Initial Investment (Range) $3,145-$50,905
Royalty 10% of Gross Billings for the preceding month
Advertising/ Marketing Not more than 1% of Gross Billings for the preceding month
Additional Training Costs and expenses incurred by the franchisee’s representatives. The franchisor may charge a reasonable fee after they have provided the initial certification program for four of the franchisee’s representatives.
Transfer Fee The greater of: $1,500 or 8% of the total Gross Billings for the 12-month period ending on the last day of the calendar month before the month in which the transfer is to occur.

 

Jani-King (2009)
Initial Franchise Fee (for Single Unit) $7,500-$16,750+ (upper range is open-ended; depends on plan purchased)
Estimated Initial Investment (Range) $9,525-$38,150+
Royalty 10% of Gross Monthly Revenues
Advertising/ Marketing 2% of Gross Monthly Revenues
Additional Training $50/hour plus expenses
Transfer Fee The greater of $2,000 or 10% of the sales price.

 

Maid Brigade (2010)
Initial Franchise Fee (for Single Unit) $19,500 (Select Market Franchises); $29,500-$58,500, for territories with minimums of 25,000 and 60,000 qualified households respectively, plus $1 for each additional qualified household (Standard & Major Market Franchises)
Estimated Initial Investment (Range) $48,500-$132,500
Royalty Between 3.5% and 6.9% of weekly gross sales based on a calendar year sliding scale of Gross Sales; Minimum weekly royalties apply
Advertising/ Marketing 2% of Weekly Gross Revenues plus local client advertising costs
Additional Training For Annual Convention: cost varies; currently $150 per franchise owner plus travel and lodging expenses
Transfer Fee $5,000 or $9,500

 

MaidPro (2009)
Initial Franchise Fee (for Single Unit) $7,900
Estimated Initial Investment (Range) $63,730-$113,840
Royalty The following percentages based on gross monthly sales from:
$0 -$50,000
6.50% $50,000.01 -$ 100,000
5.50% $ 100,000.01 -$200,000
4.50% over $200,000 3.50%
Advertising/ Marketing 1 -2% of the Consumer Gross Sales or 33% of the minimum royalties
Additional Training Registration Fees, costs and expenses
Transfer Fee $5,000

 

Martinizing Dry Cleaning (2009)
Initial Franchise Fee (for Single Unit) $35,000
Estimated Initial Investment (Range) $378,900-$562,800 (does not include sales taxes or purchased real estate)
Royalty Greater of 4% of gross sales or minimum royalty payment of $600 per month after 24 months of operation
Advertising/ Marketing Combined 4% of Gross Sales
Additional Training Travel and living expenses of franchisor's staff
Transfer Fee $5,000 plus travel and living expenses

 

Merry Maids (2008)
Initial Franchise Fee (for Single Unit) Small-Sized Market Initial Fee: $4,200-$21,000
Mid-Sized Market Initial Fee: $5,000-$25,000
Full-Sized Market Initial Fee: $6,200-$31,000
Estimated Initial Investment (Range) $25,150-$59,450
Royalty 7% of Gross Sales; 5% above $500K
Advertising/ Marketing Percentage of total gross sales per week as follows:
• 2.5% of weekly sales under $1,999.99
• 1.5% of weekly sales between $2,000.00-$3,999.99
• 1% of weekly sales greater than $4,000.00 (up to $1million annually)
• .5% of weekly sales on all sales over $lm annually
• .25% of weekly sales on all sales $3million and over
Additional Training Training for Additional Persons:
1 person, no hotel: $660
1 person. 1 king suite: $1,775
Transfer Fee Currently $3,000 for the first license transferred and then $2,500 for each additional license transferred.

 

 Molly Maid (2010)
Initial Franchise Fee (for Single Unit) $14,900
Estimated Initial Investment (Range) $71,625-$116,300
Royalty Between 3% and 6.5% of weekly gross sales based on a calendar year sliding scale of Gross Sales
Advertising/ Marketing National Marketing Fund:$150 per month not to exceed 2% of Gross Sales; Local Advertising: Between $0.25 and $1 per Target Household per year.
Additional Training $0 for the first two attendees and $500 thereafter plus all travel and living expenses incurred.
Transfer Fee $9,900 if transferred to a new franchise owner; $2,000 if transferred to an existing franchise owner.

 

PuroClean (2010)
Initial Franchise Fee (for Single Unit) $45,000
Estimated Initial Investment (Range) $68,682-$92,772
Royalty For first $0 to $19,999.99 of Gross Receipts: 10%
For next $20,000 to $39,999.99 of Gross Receipts: 9%
For any remaining Gross Receipts of $40,000 and over: 8%
Advertising/ Marketing Yellow Pages and Local Advertising: Minimum 1/4 page display ad and 2% of Gross Receipts on local advertising and promotion; Marketing Fee: 2% of Gross Receipts
Additional Training The franchisor may charge each individual a fee for attending any optional or additional training seminars.
Transfer Fee $20,000 or the then-current Transfer Fee at the time of the transfer.

 

ServiceMaster Clean - Disaster Restoration Services (2009)
Initial Franchise Fee (for Single Unit) $12,200-$61,000
Estimated Initial Investment (Range) $39,155-$132,623 (real estate costs, if needed, not included)
Royalty The greater of $250.00 or 10% gross service sales per month
Advertising/ Marketing At least 4% of gross service sales each month, plus the greater of $20.00 or 1% of gross service sales for the National Advertising Fund, and .25% of gross service sales from construction services for the Construction Services National Ad Fund fee.
Additional Training Most training sessions do not have a fee. Franchisee is responsible for travel and living expenses. There may be a small charge for training materials and meals at certain training sessions.
Transfer Fee $6,000 plus $1,000 Convention or Q-Conference Attendance Fee; $3,000 if transferred to owner's adult child who is at least 18 years of age; No fee if transferred to spouse.

  

ServiceMaster Clean - Residential Cleaning Services (2009)
Initial Franchise Fee (for Single Unit) $3,380-$16,900
Estimated Initial Investment (Range) $30,479-$92,147 (real estate costs, if needed, not included)
Royalty The greater of $250.00 or 10% gross service sales per month
Advertising/ Marketing At least 4% of gross service sales each month, plus the greater of $20.00 or 1% of gross service sales for the National Advertising Fund
Additional Training Most training sessions do not have a fee. Franchisee is responsible for travel and living expenses. There may be a small charge for training materials and meals at certain training sessions.
Transfer Fee $6,000 plus $1,000 Convention or Q-Conference Attendance Fee; $3,000 if transferred to owner's adult child who is at least 18 years of age; No fee if transferred to spouse.

 

ServiceMaster Clean - Janitorial Services (2009)
Initial Franchise Fee (for Single Unit) $6,380-$31,900
Estimated Initial Investment (Range) $21,740-$62,350 (real estate costs, if needed, not included)
Royalty The greater of $250.00 or a percentage of gross service sales on a graduated scale declining from 7% to 4% depending on the services performed per month.
Advertising/ Marketing At least 1 % of gross service sales monthly, plus an amount equal to the greater of $20.00 or 0.5% of gross monthly service sales for the National Advertising Fund.
Additional Training Most training sessions do not have a fee. Franchisee is responsible for travel and living expenses. There may be a small charge for training materials and meals at certain training sessions.
Transfer Fee $6,000 plus $1,000 Convention or Q-Conference Attendance Fee; $3,000 if transferred to owner's adult child who is at least 18 years of age; No fee if transferred to spouse.

 

ServiceMaster Clean - Commercial Services (2009)
Initial Franchise Fee (for Single Unit) $3,780-$18,900
Estimated Initial Investment (Range) $20,926-$58,282 (real estate costs, if needed, not included)
Royalty The greater of $250.00 or 10% of gross service sales.
Advertising/ Marketing At least 4% of gross service sales each month, plus the greater of $20.00 or 1% of gross service sales for the National Advertising Fund.
Additional Training Most training sessions do not have a fee. Franchisee is responsible for travel and living expenses. There may be a small charge for training materials and meals at certain training sessions.
Transfer Fee $6,000 plus $1,000 Convention or Q-Conference Attendance Fee; $3,000 if transferred to owner's adult child who is at least 18 years of age; No fee if transferred to spouse.

 

ServiceMaster Clean - Small Market Services (2009)
Initial Franchise Fee (for Single Unit) $6,380-$31,900
Estimated Initial Investment (Range) $26,091-$84,103 (real estate costs, if needed, not included)
Royalty The greater of $250.00 or 10% gross service sales per month
Advertising/ Marketing At least 4% of gross service sales monthly, plus the greater of $20.00 or 1% of gross services sales for Construction Services, and an amount equal to .25% of gross monthly revenue from construction services for the National Advertising Fund
Additional Training Most training sessions do not have a fee. Franchisee is responsible for travel and living expenses. There may be a small charge for training materials and meals at certain training sessions.
Transfer Fee $6,000 plus $1,000 Convention or Q-Conference Attendance Fee; $3,000 if transferred to owner's adult child who is at least 18 years of age; No fee if transferred to spouse.

 

ServPro (2009)
Initial Franchise Fee (for Single Unit) $40,000 plus $444.44 per 1,000 in population over maximum
Estimated Initial Investment (Range) $102,250-$161,150 (plus additional if over maximum population and any real estate costs)
Royalty 3% to 10% of Monthly Gross Volume
Advertising/ Marketing ½% of the Gross Volume, not including Gross Volume from Subcontract Services monthly, plus 2½% of the annual Gross Volume on a calendar year basis, not including Gross Volume from Subcontract Services
Additional Training Franchisee must pay personal expenses for training, including costs and expenses of transportation, lodging, meals, and wages and employee benefits if employees attend the training program. Franchisor may charge a reasonable fee for training materials for additional training courses.
Transfer Fee Up to $8,500

 

The Maids (2011)
Initial Franchise Fee (for Single Unit) $10,000
Estimated Initial Investment (Range) $92,545-$120,295
Royalty 3.9% to 6.9% of Gross Revenues (minimum continuing fees apply)
Advertising/ Marketing 2% of Gross Revenues
Additional Training $500 per day plus travel expenses
Transfer Fee  $6,000

 

Vanguard Cleaning (2010)
Initial Franchise Fee (for Single Unit) $2,094.66-$33,300
Estimated Initial Investment (Range) $2,519.66-$34,400
Royalty 5% of Monthly Gross Billings
Advertising/ Marketing N/A
Additional Training Not disclosed
Transfer Fee $1,000

 

 

 

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