Franchising Since: 2007
Headquarters: West Palm Beach, Florida
Estimated Number of Units: 50
Franchise Description: Security Franchisors, LLC is the franchisor. The franchise offered is for the operation of a commercial security business that will provide sales, engineering, installation and monitoring of electronic access control; closed circuit television; and intrusion detection systems for commercial enterprises under the name “Security 101.”
Training Overview: Franchisees may not open their commercial security business until they or their general manager completes the initial training program to the franchisor’s satisfaction. The training program consists of three weeks of training at the franchisor’s home office location in West Palm Beach, Florida, two weeks of training at a current franchisee location in Orlando, Florida, and three weeks of training at the incoming franchisee’s place of business (with one additional week of preparation work that franchisees will do in advance of training at their business). No additional training programs or refresher courses are currently required, but the franchisor reserves the right to require franchisees to attend additional training programs or refresher courses in the future. The franchisor may hold annual franchise conferences and require franchisees to attend.
Territory Granted: Franchisees will be granted the right to operate their commercial security business within a designated protected territory. The protected territory will be defined by metropolitan statistical areas, zip codes, county or municipal boundaries, or geographic or highway boundaries. Each franchisee’s protected territory will be designated as an “A”, “B”, or “C” market based on the population of the protected territory on the date the Franchise Agreement is signed. “A” markets will contain a population in excess of 1,500,000 residents. “B” markets will contain a population between 500,000 and 1,500,000 residents. “C” markets will contain less than 500,000 residents. Franchisees will operate their commercial security business from a specific location that the franchisor approves inside the protected territory. During the term of the Franchise Agreement, the franchisor will not establish either a company-owned Security 101 business or another franchised Security 101 business inside a franchisee’s protected territory (except for “national account sales” or “cross sales”) or modify the protected territory without the franchisee’s written permission, provided that the franchisee is in compliance with the terms and conditions of the Franchise Agreement.
Obligations and Restrictions: While the franchisor does not require that franchisees personally supervise their commercial security business, the franchise must be directly supervised, on a daily basis, by a manager who has successfully completed the training program. The manager may not have an interest or business relationship with any of the franchisor’s business competitors. The manager need not have an ownership interest in the franchisee, but he or she must sign a written agreement to maintain the confidentiality of the franchisor’s trade secrets and to conform with the covenants not to compete. The franchisor requires franchisees to offer and sell only those services that it has approved and that franchisees only utilize products approved by the franchisor. Franchisees are required to offer all the products and services as defined in the operations manuals. Franchisees are not permitted to install security systems in the residential market unless it is an accommodation for a referral source or a family member of a commercial customer.
Term of Agreement and Renewal: The length of the initial franchise term is 10 years. If franchisees are in good standing and satisfy the renewal requirements, they can renew for additional 10-year terms.
Financial Assistance: The franchisor does not offer direct or indirect financing. The franchisor does not guarantee a franchisee’s notes, leases or obligations.
Investment Tables:
| Name of Fee | Low | High |
|---|---|---|
| Initial Franchise Fee | $59,500 | $59,500 |
| Travel & Living Expenses While Training | $4,000 | $8,000 |
| Rent | $2,250 | $4,500 |
| Leasehold Improvements | $500 | $2,500 |
| Furniture, Equipment & Signage | $4,900 | $7,500 |
| Computer System | $1,500 | $3,000 |
| Software Fee | $1,500 | $1,500 |
| Initial Inventory | $2,000 | $3,000 |
| Miscellaneous Opening Costs | $1,500 | $2,500 |
| Security and Lease Deposits | $1,500 | $3,000 |
| Additional Funds - 6 months | $50,950 | $140,000 |
| ESTIMATED TOTAL | $130,100 | $235,000 |
| Type of Fee | Amount |
|---|---|
| Royalty Fee | Ranges from 4% to 6% of gross billings. Monthly minimum payment requirement ranging from $2,000 to $8,000 begins on the 13th month following the opening date of the commercial security business. |
| Marketing and Advertising Fees | 0.5% of monthly gross billings. |
| 101 Ware Software Fee | $500 per month. |
| Cross Sales Fee | 70% of gross billing for cross sale. |
| Late Fee | $50 |
| Interest | The lesser of 18% per annum or the maximum legal rate allowed by applicable law. |
| Local Advertising | In addition to the marketing and advertising fee franchisees must spend at least 2% of the franchisee’s monthly gross billings on local advertising and marketing. |
| Additional Franchise Management Training | Currently $750 per person. |
| Transfer Fee | 25% of the then-current initial franchise fee. |
| Renewal Fee | 10% of the then-current initial franchise fee. |
| Audit | The expenses the franchisor incurs to audit the franchisee’s records, ranging between $750 to $3,000. |
| Insurance | $1,000 to $3,000 |
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