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ServiceMaster Franchise Cost & Fees

Date of Incorporation: 1947

Franchising Since: 1948

Headquarters: Memphis, Tennessee


Business Description: ServiceMaster and its predecessors have been performing professional cleaning services since 1929 when Marion E. Wade began the business as a sole proprietor.


Franchise Offer: ServiceMaster Clean currently offers the following franchises:

  1. Disaster Restoration Services: provides disaster restorative services direct to customers and through insurance adjusters to customers following a fire, flood, earthquake or storm.
  2. Floor Care Services: provides carpet, hard surface floor care, wall and other heavy cleaning in homes, apartments, and condominiums and other periodic non-janitorial cleaning and maintenance to management or tenants of any commercial or institutional building.
  3. Janitorial Services: provides contracted janitorial services on a continuing basis and may also provide carpet, furniture and other periodical non-janitorial cleaning and maintenance to management or tenants of commercial or institutional buildings.
  4. Small Market Services: provides contracted janitorial services as well as carpet and furniture cleaning and disaster restoration services.
  5. Recovery Management Services: provides recovery management and disaster services directly to commercial customers who have the capacity to provide commercial restoration opportunities of $500,000 or greater in contract value and who are not existing Disaster Restoration Services Customers.


Financial Assistance: The franchisor does not offer direct financing. Their affiliate, SMAC, does offer financing to franchisees or the franchisee may choose another lender or finance company. If the franchisee is interested in obtaining a loan guaranteed through the United States Small Business Administration, ServiceMaster is listed on their Franchise Registry which provides expedited loan processing for franchise businesses.


Training and Assistance: The training program is called the Academy and consists of several hours of both classroom training and on-the-job training. The Academy is a school of intensified training and is two to six weeks long depending on the type of license(s) the franchisee purchases. The franchisee or the manager must attend the Academy and pass a written test prepared by ServiceMaster within six months after the purchase of the franchise. If the franchisee purchases a Disaster Restoration-Floor Care Services combination he or she will attend a three-week Disaster Restoration Academy in Memphis, Tennessee, and then the next scheduled one-week Floor Care Academy in Memphis, Tennessee. If the franchisee plans to operate a Small Market business, he or she will attend a three-week Disaster Restoration Academy, then the next scheduled one-week Floor Care Academy in Memphis, Tennessee, and return to Memphis, Tennessee, to attend the one-week of Janitorial Production Academy. If the franchisee purchases a Recovery Management Services franchise, he or she will attend the next scheduled one-week Recovery Management Academy in Memphis, Tennessee. The hotel cost and some meals for one person to attend the Academy are included in the Initial Franchise Fee. Franchisees are required, at their expense, to attend at least three seminars, workshops, conventions, or meetings offered by the franchisor during each year. The franchisor will conduct inspections and provide other training programs as deemed appropriate. The franchisor may also may provide mentoring and on-site support on an as needed basis for Recovery Management Services franchises.


Territory: The franchisor will designate a territory within which the franchisee will perform services. The franchisee will not receive an exclusive territory. He or she may face competition from other franchisees, from company-owned businesses, or from other channels of distribution or competitive brands controlled by the franchisor. The franchisor may establish or may already have established another franchised or company-owned business that may compete with the franchisee in the territory.


Term of Agreement and Renewal: The length of the franchise term is five years. The franchisee has the option to renew the franchise for an additional five years if the franchisee has substantially complied with the agreement and maintained the business in accordance with system standards.


Obligations and Restrictions: ServiceMaster does not require that the franchisee personally supervise the franchised business, in which case the franchisee must employ a manager who will be responsible for direct, on-premises supervision of the business. The manager must successfully complete the Academy training program. The franchisee must offer and provide the required services.


Estimated Number of Units: 4,935

 

Investment Tables:

Initial Investment:

Disaster Restoration Services

Name of Fee Low High
Initial Franchise Fee $61,900 $67,000
Opening Package $66,035 $66,035
Vehicle - Purchase $3,000 $4,000
Insurance: Vehicle – Business Auto $1,200 $1,200
Insurance: Vehicle Liability Package $2,000 $2,000
Workers’ Compensation and Occupational Disease Insurance (According to the state and amount of payroll) $750 $2,000
Travel and Other Expenses for Training $600 $1,000
Computer Hardware and Software $6,500 $7,000
High Speed Internet Connection $300 $1,000
Advertising - 3 months $1,200 $6,400
Miscellaneous Opening Costs $1,000 $7,200
Additional Funds - 3 months $12,000 $18,500
Real Estate and Improvements Varies Varies

Estimated Totals:
Market <1,000,000 population


Market >1,000,000 population


$149,985


$171,235


$155,085


$176,335

 

Floor Care Services

Name of Fee Low High
Initial Franchise Fee $24,900 24,900
Opening Package $28,062 $28,062
Vehicle - Purchase $3,000 $4,000
Insurance: Vehicle – Business Auto $1,200 $1,200
Insurance: Vehicle Liability Package $2,000 $2,000
Workers’ Compensation and Occupational Disease Insurance (According to the state and amount of payroll) $750 $2,000
Travel and Other Expenses while at Training $600 $1,000
Computer Hardware and Software $3,500 $4,000
High-Speed Internet Connection $60 $150
Advertising - 3 months $600 $6,400
Miscellaneous Opening Costs $1,000 $4,200
Additional Funds - 3 months $7,500 $12,500
Real Estate and Improvements Varies Varies
Estimated Total (not including real estate)
$78,572 $86,412

 

Janitorial Services

Name of Fee Low High
Initial Franchise Fee $31,900 $31,900
Vehicle - Purchase $3,000 $4,000
Insurance: Vehicle $1,200 $1,200
Comprehensive General Liability Insurance $2,000 $2,000
Workers’ Compensation and Occupational Disease Insurance (According to the state and amount of payroll) $750 $2,000
Travel and Other expenses while at Training $600 $1,000
Computer Hardware and Software $3,500 $4,000
High-Speed Internet Connection $60 $150
Advertising - 3 months $600 $6,400
Miscellaneous Opening Costs $1,000 $4,200
Additional Funds - 3 months $7,500 $12,500
Real Estate and Improvements Varies Varies
Estimated Total (not including real estate) $48,610 $65,350

 

Small Market Services

Name of Fee Low High
Initial Franchise Fee $33,900 $33,900
Opening Package $40,632 $40,632
Vehicle - Purchase $3,000 $4,000
Insurance: Vehicle – Business Auto $1,200 $1,200
Insurance: Vehicle Liability Package $2,000 $2,000
Workers’ Compensation and Occupational Disease Insurance (According to the state and amount of payroll) $750 $2,000
Computer Hardware and Software $4,500 $5,000
High-Speed Internet Connection $60 $150
Advertising - 3 months $600 $6,400
Miscellaneous Opening Cost $1,000 $4,200
Additional Funds - 3 months $7,500 $12,500
Real Estate and Improvements Varies Varies
Estimated Total (not including real estate) $96,242 $102,982

 

Recovery Management Services

Name of Fee Low High
Initial Franchise Fee $52,000 $52,000
Equipment $58,000 $60,000
Vehicles $16,900 $92,950
Travel and Other Expenses while at Training $600 $1,000
Computer Software $1,000 $2,000
Insurance: Vehicles – Business Auto $2,400 $2,400
Insurance: Comprehensive General Liability Insurance $2,000 $2,000
Workers’ Compensation and Occupational Disease Insurance (According to the state and amount of payroll) $750 $2,000
Pollution Liability with mold coverage $3,750 $3,750
Errors and Omissions or Professional Liability $1,500 $1,500
General Liability Umbrella (for minimum limit)
$3,500
$3,500
Business Bond Varies according to customer's requirements
Advertising - 3 months $30,750 $30,750
Miscellaneous Opening Costs $2,000 $6,200
Additional Funds -3 months (And a $500,000 line of credit and a minimum credit limit of $1,000,000) $600
$6,000
Real Estate and Improvements Varies Varies
Estimated Total (not including real estate) $175,750 $266,050

 

Other Fees:

Disaster Restoration Services

Name of Fee Amount
Royalty The greater of $250 or 10% gross monthly service sales.
Construction Services fees An amount equal to 2% of gross monthly revenue from construction services without any deduction for subcontractor performed work.
National Advertising Fund The greater of $200 or 1% of gross service sales.
Construction Services National Ad Fund fee 0.25% of gross service sales from construction services.
Delinquent Report Fee $50 per delinquent report.
Advertising At least 4% of gross service sales each month.
Transfer Fee $7,000 plus $1,000 for Convention or Q-Conference Attendance Fee;
$3,500 if transferred to owner's adult child who is at least 18 years of age;
No fee if transferred to spouse.
Renewal Fee $2,000 per agreement; If more than one franchise agreement is renewed at the same time, the renewal fee for each additional $1,500.
Lead Fee $10,000
Add/Delete/Change Fee $400 owner's name; business entity name; or business structure; $200 change business name.
Xactware Licensed Products Software Fee $89 for each base license; $19 for each additional license pack; $350 one-time set up fee if software was not included in initial license;
$4.95 to $29.95 fee per upload; a sliding scale based on invoice value.
Chronicle Software Fee (Starter Package) $324 (hosted)
Remote date back-up – 100GB $33.33 per month
Mobile Service Administrator (MSA) $100 per month per Xactnet address.
$25 per month per Mobile Service Manager.
Academy of Service Training and On-Going Training $600-$1,000 (travel cost and some meals);
For transfer licenses: $5,950 for a two-week Academy.
Audit Cost of audit plus 1.5% per month or maximum allowable on underpayment.
Additional Requirements for Construction Services License: Insurance Insurance must be written by insurance company satisfactory to ServiceMaster Clean and in accordance with standards and specifications set forth in the Operations Manual or otherwise in writing.

 

Floor Care Services

Type of Fee Amount
Royalty The greater of $250 or 10% gross service sales.
National Advertising Fund An amount equal to the greater of $200 or 1% of gross monthly service sales.
Delinquent Report Fee $50 per delinquent report.
Advertising At least 4% of gross service sales each month.
Transfer Fee $7,000 plus $1,000 for Convention or Q-Conference Attendance Fee;
$3,500 if transferred to owner's adult child who is at least 18 years of age;
No fee if transferred to spouse.
Renewal Fee $2,000 per agreement; If more than one franchise agreement is renewed at the same time, the renewal fee for each additional $1,500.
Add/Delete/Change Fee $400 owner's name; business entity name; or business structure.
$200 change business d/b/a name.
Remote Data Back-up - 100 GB $33.33
Vonigo Software $68 per month
Academy of Service Training and On-Going Training $600 - $1,000 (travel costs and some meals)
For transfer licenses: $1,825 for a one-week Academy.
Audit Cost of audit plus 1.5% per month or maximum allowable on underpayment.

 

Janitorial Services

Name of Fee Amount
Royalty The greater of $250 or a percentage of gross service sales on a graduated scale declining from 7% to 4% depending on the services performed.
National Advertising Fund An amount equal to the greater of $20 or 1% of gross monthly service sales.
Delinquent Report Fee $50 per delinquent report.
Advertising At least 2% of gross service sales monthly
Transfer Fee $7,000 plus $1,000 for Convention or Q-Conference Attendance Fee;
$3,500 if transferred to owner's adult child who is at least 18 years of age;
No fee if transferred to spouse.
Renewal Fee $2,000 per agreement; If more than one franchise agreement is renewed at the same time, the renewal fee for each additional $1,500.
Add/Delete/Change Fee $400 owner's name; business entity name; or business structure.
$200 change business d/b/a name.
Express Time On-Line Software Fee $39.95 + 12 cents fee per call and 5 cents per numeric page.
ServiceLink powered by CleanTelligent Software fee $225 per month; $50 per hour for phone/e-mail support.
Academy of Service Training and On-Going Training $600 - $1,000 (travel costs and some meals)
For transfer licenses: $3,650 for a two-week Academy.
Audit Cost of audit plus 1.5% per month or maximum allowable on underpayment.

 

Small Market Services

Type of Fee Amount
Royalty The greater of $250 or 10% of gross monthly service sales.
Construction Services Fees An amount equal to 2% of gross monthly revenue from construction services without any deduction for subcontractor performed work.
National Advertising Fund The greater of $200 or 1% of gross services sales.
Construction Services National Ad Fund Fees An amount equal to .25% of gross monthly revenue from construction services.
Delinquent Report Fee $50 per delinquent report.
Advertising At least 4% of gross service sales monthly.
Transfer Fee $7,000 plus $1,000 Convention or Q-Conference Attendance Fee;
$3,500 if transferred to owner's adult child who is at least 18 years of age;
No fee if transferred to spouse.
Renewal Fee $2,000 per agreement; If more than one franchise agreement is renewed at the same time, the renewal fee for each additional $1,500.
Add/Delete/Change Fee $400 owner's name; business entity name; or business structure.
$200 change business d/b/a name.
Xactware Licensed Products Software Fee $89 for each Base License; $19 for each additional license pack.
$350 one time set up fee if software was not included in the initial license.
$4.95 to $29.95 fee per upload; sliding scale based on invoice value.
Symbility Software $12 per claim uploaded.
Express Time On-Line software fee $39.95 + 12 cents fee per call and 5 cents per numeric page.
Remote Data Back-up - 100 GB $33.33 per month.
Mobile Service Administrator (MSA) $100 per month per Xactnet address
$25 per month per Mobile Service Manager
Academy of Service Training and On-Going Training $600 - $1,000 (travel cost and some meals)
For transfer license: $9,100 for six weeks of Academy.
Audit Cost of audit plus 1.5% per month or maximum allowable on underpayment.
Additional Requirements
For Construction Services
License: Insurance
Insurance must be written by insurance company satisfactory to ServiceMaster in accordance with standards and specifications set forth in the Operations Manual or otherwise in writing.

 

Recovery Management Services

Type of Fee Amount
Royalty The greater of $250 or 10% of gross monthly sales.
Referral and Job Referral Fees 2% - 5% of gross sales referral fee on claims over $3,000
$85 per job referred through the Recovery Management Call Center.
On-Site Assistance $35 - $55 per diem plus travel hotel expenses, and Franchisor's Project Manager's labor rate.
National Advertising Fund The greater of $200 or 0.5% of gross service sales.
Delinquent Report Fee $50 per delinquent report.
Advertising At least 4% of gross service sales.
Transfer Fee $7,000;
$3,500 if transferred to owner's adult child who is at least 18 years of age.
Add/ Delete/Change Fee $400 owner's name; business entity name; or business structure.
Academy of Service Training Fee and On-Going Training $600 to $1,000 (travel cost and some meals);
For transfer license: $1,825 for a one-week Academy

Date of FDD: 2013

The above information has been taken from the FDD of ServiceMaster Clean.

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