Sears Maid Services Franchise Costs & Fees
Date of Incorporation: 1992
Franchising Since: 2014
Headquarters: Lewis Center, Ohio
Business Description: The franchisor is Sears Home & Business Franchises, Inc. Franchisees operate a service business that provides quality residential and light commercial cleaning on a one-time or re-occurring basis.
Franchise Offer: The franchisor offers and grants franchises to operate businesses that engage in residential and light commercial cleaning under the name “Sears Maid Services” and other trademarks, trade names, logos and commercial symbols it authorizes.
Financial Assistance: If the franchisee requests and the franchisor approves, it will “finance” (meaning the franchisee may defer paying) either: (i) 50% of the Initial Franchise Fee; or (ii) 80% of the Initial Franchise Fee. If franchisees finance 50% of the Initial Franchise Fee, the amount financed will be amortized over a period of 7 years and collected each month until the amount is paid in full. If franchisees, however, choose to finance 80% of the Initial Franchise Fee, the amount financed will be amortized over a period of 10 years and collected each month until the amount is paid in full.
Training and Assistance: The franchisor will train franchisees (or, if franchisees are a corporation, partnership, limited liability company or other business entity, their managing owner) and franchisees’ management or supervisory personnel in operating a Business. Unless the franchisor agrees otherwise, all persons from the Business must attend the initial training program together. Franchisees (or their managing owner) and any general manager the franchisee designates as having direct responsibility for the Business’s day-to-day operation (General Manager) must complete the initial training program to the franchisor’s satisfaction. The training program consists of 3 days of training using the Business Manual for instructional materials. Training will occur at the franchisor’s headquarters in Lewis Center, Ohio, or at a facility designated by the franchisor. The franchisor may require franchisees and their personnel to attend any supplemental or refresher training programs that the franchisor offer during the franchise term, and franchisees must pay all tuition charges and travel and living expenses for them and their personnel.
Territory: The franchisor will grant franchisees a protected area within which it will neither, except as described in the FDD, operate nor grant rights to operate a Business under the Marks (the Territory). However, other Sears affiliates and facilities may offer and sell similar services and products to customers located within the Territory. The size of the Territory depends on the Initial Franchise Fee the franchisor pays, and usually includes between 100,000 and 300,000 SFDUs. The franchisor marks the Territory’s boundaries by Sectional Center Facilities (the post office’s groupings for zip codes).
Term of Agreement and Renewal: The length of the initial franchise term is 10 years. Renewal of the term is for 10 years, if franchisees meet certain requirements.
Obligations and Restrictions: Franchisees must at all times faithfully, honestly and diligently perform their contractual obligations and continuously exert their best efforts to promote and enhance their Business, and their Business must continuously develop and service customers within the Territory. The franchisor’s standards and specifications may regulate the franchisee’s Business’s hours of operation, human relations policies and employee qualifications, training, dress and appearance. Franchisees must offer all products and perform all services (including the Services) that the franchisor periodically requires for Businesses, and franchisees may not offer any products or perform any services that it has not authorized. The franchisor may, periodically, set maximum or minimum prices that franchisees may charge for products or services offered by the franchisee’s Business.
Estimated Number of Units: 25
|Name of Fee||Low||High|
|Initial Franchise Fee||$15,000||$45,000|
|Vehicle(s) and Accessories||$900||$3,600|
|Cleaning Equipment & Supplies||$2,000||$4,500|
|Opening Advertising & Sign||$2,000||$6,000|
|Training, Travel, Lodging & Food||$1,000||$5,500|
|Deposits, Permits, Licenses||$0||$3,000|
|Additional Funds – 3 months||$5,000||$20,000|
|Type of Fee||Amount|
|Royalty||6% of Net Revenue.|
|Deferred Franchise Fee Payments for either 50% or 80% of the Initial Franchise Fee||Will vary with circumstances.|
|Software Support Fee||Up to $350 (currently $250) per month for one office plus $50 a month for each additional office.|
|National Marketing Fund Contribution||2% of Net Revenue.|
|Pre-Print Program Contributions, Sears Charge Card Inserts and Sears MasterCard Inserts, or Alternate Charge Card Elected by the Franchisor||Will vary with the circumstances.|
|mailer Program Fee||Currently $0.50 per mailer, subject to increase.|
|Advertising Cooperative Payments||Will vary with the circumstances.|
|Customer Adjustments||Will vary with the circumstances.|
|Replacement Business Manual||Currently $250|
|Additional On-Site Assistance||Approximately $200 per day, per person plus expenses.|
|Fee for Supplemental or Refresher Training||Currently $50 to $100 per person, per day.|
|Fee for Failing to Provide Materials||$500 per day, plus expenses incurred because of delay.|
|Audit Expenses||Cost of inspection or audit.|
|Interest on Late Payments||Highest applicable legal rate for open account business credit in the franchisee’s state or 1.5% per month, whichever is less.|
|Renewal Franchise Fee||$2,500|
|Transfer or Sale of Part of an Existing Franchise Territory||$2,500|
|Indemnification||Will vary with the circumstances.|
|Costs and Attorneys’ Fees||Will vary with the circumstances.|
|Webpage Fee||Currently $0|
|Termination Fee||An amount equal to the net present value of the Royalty fees, National Marketing Fund contributions, and Advertising Cooperative contributions that would have become due following termination of the Franchise Agreement for the period the Franchise Agreement would have remained in effect but for the franchisee’s default.|
The above information has been taken from the FDD of Sears Maid Services. Year of FDD: 2016
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