FDD Talk Daily: Total Revenue, Expenses, and Gross Profit of Affiliate-Owned College Hunks Hauling Junk and College Hunks Moving Businesses

Highlights of College Hunks Hauling Junk’s Item 19 Financial Performance Representations (2012 FDD) – Part 1

• The company is offering franchises for the operation of businesses operating under the “College Hunks Hauling Junk” and “College Hunks Moving” names which will provide junk removal services and/or moving services, including picking up of unwanted items from residential or commercial clients and taking it to the appropriate landfill or transfer station for appropriate disposal or recycling.

• The franchisor offers standard franchises, “small market” franchises, and conversion franchises.

• The total investment necessary to begin operation of a College Hunks Hauling Junk or College Hunks Moving franchise is $61,900 to $167,950. This includes at least $500 to $40,000 that must be paid to the franchisor and/or its affiliate.

• The franchisor also offers to qualified individuals and entities the opportunity to become its Development Agent within a specific geographical area. A Development Agent will act as the franchisor’s agent in a specific territory, solicit new franchisees, assist existing franchisees, and conduct inspections of Businesses in the territory, among other things.

• A Development Agent must pay the franchisor an initial fee equal to $10,000 for each viable zone in the Development Area being purchased.  A Development Agent must also own and operate at least one College Hunks Hauling Junk or College Hunks Moving business in the Development Area.

• The franchisor will pay a Development Agent a portion of the initial franchise fees, royalty fees, and transfer fees collected.

Part I – Affiliate Results

• The following represents the actual sales achieved by the College Hunks Moving and Hauling Business in Rockville, Maryland, which has been in operation since 2005, and the College Hunks Moving and Hauling Business in Tampa, Florida, which has been in operation since 2008, and in which the company’s affiliate has a majority ownership interest. Both of these Businesses are operated by affiliates.

• The franchisor is not representing that you can expect to achieve these sales in your first year of operation, or at any time during the term of your Franchise Agreement. Your revenues may vary significantly depending on a number of factors, including the location of your Franchised Business and how you operate your business.

• The following section presents the gross sales and primary variable costs that the affiliate realized in operating College Hunks Hauling Junk and College Hunks Moving Businesses in Rockville, Maryland and Tampa, Florida.

• The affiliate operates substantially the same type of business that you will operate but it does not operate a franchised unit.

• These operations are both “absentee owner” businesses, meaning that they both have full-time general managers operating the businesses.

• The figures used in this statement are total revenues and direct costs. The expenses reflected below do not include fixed costs, such as supplies, marketing, office staff or managers, professional fees, office expenses, rent, insurance, discretionary expenses, or owner compensation.

• Net income will vary from Business to Business depending upon these expenses and other costs relating to the operation of the Business.

• No other outlet in the system has earned as much as the Rockville, Maryland location.

Rockville, Maryland