Home Based Cleaning Franchises Show Strong Growth In 2008

Most cleaning franchises are showing a substantial increase from 2006 to 2007. With the down turn of the housing market and the up swing of the new and remodeled commercial property there remains a need for janitorial services. Here is a small but helpful list of cleaning franchises businesses you can run from your home.

Jani-King

Jani-King (Commercial cleaning) began in 1969 and has been Franchising since 1974. While working the night shift in a Hotel Jim Cavanaugh saw the continued need for janitorial services.

Etrepreneure.com reports from 2006-2007 Jani-King added 496 new U.S. franchises, 29 Canadian, 31 Foreign, and 3 company owned. With commercial real-estate expecting to grow in 2008 it is predicted that the need for janitorial services will also grow.

Costs:

Startup costs $11k-34k+

Franchise fee: $8.6k-$16.3k+

Ongoing royalty fee: 10%

Term: 20 years, renewable

Operations:

Can be run from home

No absentee ownership

Bonus Building Care

OK your going to think this is too personal but it’s the reality of business. Jim Cavanaugh (from Jani-King) divorced and his ex-wife Arleen Cavanaugh started Bonus Building Care and you guessed it, it is a janitorial service. This is a prime example of how fruitful the commercial janitorial business is. BBC was started in 1996 and increased its U.S. franchises from 1415 in 2006 to 1774 in 2007 3 of which are owned by the company.

Cost:

Startup: $8k – $13k+

Franchise fee: $6.5k

Ongoing royalty fee: 10%

Term: 20 years, renewable

Renew fee: $2k

Operations:

Can be run from home

Employees needed to run: 1-5

No absentee ownership

Jan-Pro Franchising Int’l. Inc.

Specializing in commercial cleaning began in 1991 and has been franchising since 1992. Founded by Jacques Lapointe Jan-Pro increased its U.S. franchise base from 5066 in 2006 to 6409 in 2007. Canadian franchises when from 305 in 2006 to 609 in 2007. 14 foreign franchises were started in 2007.

Costs:

Startup: $3.3k-$49.9k

Franchise fee: $2.8k-$44k

Ongoing royalty fee: 10%

Term: 10 years, renewable

Qualifications:

New worth: $1k-14k+

Cash liquidity: $1k

Business exp.: management skills

Operations:

Can be run from home

Number of employees: 1

No absentee ownership

Servpro

Servpro (residential and commercial cleaning) began in 1967 and started franchising in 1969. Ted Isaacson began providing homes and business with cleaning and restoration services which includes but not limited to disaster protection, air ducts and HVAC systems. Servpro grew its nationwide franchise base from 1310 in 2006 to 1368 in 2007.

Costs:

Investment: $97k – $154k

Franchise fee: $38k

Ongoing royalty fee: 3-10%

Term: 5 years, renewable

Renewal fee: $250

Qualifications:

Net worth: $100k

Cash Liquidity: $60k

Business exp: General, Marketing skills

Operations:

Can be run from home

Employees needed: 5-10

No absentee ownership allowed

Chem-Dry (carpet, drapery & upholstery cleaning)

Robert Harris founded Chem-Dry in 1977 and started franchising in 1978 using a cleaning solution he created. Chem-Dry has worldwide franchise opportunities. From 2006 – 2007 the company grew its U.S. base from 2547-2679.

Costs:

Startup: $25k-$214k

Franchise fee: $13k-$35k

Ongoing royalty fee: #350/mo.

Renewal fee: $750

Qualifications:

Net worth: $75k

Cash liquidity $4k

Operations:

Can be run from home

Absentee ownership is allowed

ServiceMaster Clean (began 1947, franchising since 1952)

It is said that after a chemical accident left Marion Wade partially blind in 1945 he came up with the idea for a commercial and residential heavy cleaning and disaster restoration company. ServiceMaster Clean is part of a unit of franchises which includes Merry Maids and Terminix. ServicesMaster saw a rise in us franchises from 2978 in 2006 to 3041 in 2007. Canadian franchises grew from 166 to 172 respectively. This company has been around a long time and it is no wonder it has experienced the consistent growth.

Costs:

Investment: $21k – $111k

Franchise fee: $17k-45k

Ongoing royalty fee: 4-10%

Term: 5 years, renewable

Qualifications:

Net worth: $50k-75k

Cash liquidity: $15k-25k

Experience: General business

Operations:

Can be run from home

Number of employees needed: 3

Absentee ownership is not allowed

System4 (commercial cleaning)

Began in 2003 and started franchising right away, based in Brecksville Ohio System4 is a nationwide franchiser with 467 franchisees in 2007 (up from 283 in 2006).

Costs:

Investment $6k – $38k

Franchise fee: $4.4k – $32k

Ongoing royalty: 5%

Term: 20 years, renewable

Qualifications:

Net worth: $10k

Operations:

Can be run from home

Employees needed: 3

Absentee ownership is allowed

Building Stars Inc.

Building Stars Inc. began in 1994 and started franchising in 2000. Based out of St. Louis Missouri BB Inc saw an increase in franchisees of 217 to 225 from 2006 – 2007.

Costs:

Investment: $2.2k

Franchise fee: $1.2k

Ongoing royalty fee: 10%

Term: 5 years, renewable

Qualifications:

Cash liquidity: $1k

Operations:

Can be run from home

Number of employees needed: 5

Absentee ownership is not allowed

There are plenty of businesses that already turn great profits. In order for you to get a slice of the pie you have to be in the kitchen. Home based cleaning franchises will show strong growth in 2008. As always, pick your business carefully and plan your moves for growth and longevity.

Mobile Based Franchising and Liability Insurance Issues in Franchising Agreements

Mobile based franchising companies must consider the potential eventuality of being sued or named in a lawsuit, which is directed at a franchisee due to a traffic accident while conducting the franchise outlets business operations. In places like New York, California, Washington D.C. the number of lawsuits from traffic accidents are astounding. Without protection and separation from the franchise outlets, a franchisor might unnecessarily open themselves up for liability issues of one of their franchisees.

It is for this reason that in my franchising agreements are decided to spend special attention to the clauses regarding insurance, limits of liability and operations of vehicles in the franchise business. Below is a copy of the clause that I inserted into our franchise agreements;

3.21 Insurance

3.21.1 Limits of Liability

Prior to the commencement of any operations under this Agreement, Franchisee must maintain, at their sole expense, a business liability, comprehensive and completed operations insurance policy or policies in accordance with standards and specifications set forth in the Confidential Operations Manual, which must include at a minimum the following coverage:

(a) Comprehensive general liability insurance, in the amount of $100,000 bodily

injury per occurrence and $50,000 property damage per occurrence;

(b) Vehicle insurance in the amount of $100,000 single limit, including

comprehensive and collision;

(c) Worker’s Compensation and Employer’s liability insurance (if Franchisee

has employees); and

(d) Equipment insurance for the value of all The Car Wash Guys equipment.

If Franchisee finances the equipment, the lending institution may also require Franchisee to maintain fire/theft/comprehensive insurance for the value of that equipment.

3.21.2 Additional Insured

Franchisor shall be named as an additional insured under all insurance policies, as its interests may appear, and contain a waiver by the carrier of all subrogation rights against Franchisor. Maintenance of insurance under this paragraph shall not relieve Franchisee of liability under the default provisions set forth in this Agreement.

3.21.3 Other Requirements

Franchisor may, at its discretion, change the required coverage and the limits of liability for Franchisee’s insurance during the term of this Agreement. Franchsior may require Franchisee to increase the minimum limits of coverage to keep pace with regular business practice and prudent insurance custom. In the event Franchisor does this, Franchisee may be paying a higher or lower premium.

The insurance will not be limited in any way because of any insurance Franchsior maintains. The insurance will not be subject to cancellation except upon twenty (20) days’ written notice to Franchsior. Certificates of Franchise’s insurance policies will be kept on deposit with Franchisor. Maintenance of the required insurance will not diminish Franchisees liability to Franchisor under the indemnities contained in this Agreement.

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If you run or operate the mobile franchise company you must pay attention to the insurance issues and make sure you or additionally insured to prevent risks to your financial health as a franchisor. You will need to contact the franchise attorney to make sure the clause in your contracts is up-to-date, considers all the recent case law and is liable for the jurisdiction of your franchise company and the jurisdiction of the franchise outlets where you will be selling these franchises. Make sure you get a franchise attorney who is knowledgeable inexperienced in this area. I hope you will consider this in 2006.