Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

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Franchise Costs: Detailed Estimates of Maid Brigade Franchise Costs (2016 FDD)

by Franchise Chatter on June 17, 2014

in Franchise Costs, Maid Franchise

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This post was updated on November 8, 2016 to reflect information from Maid Brigade’s 2016 FDD (Item 7).

Detailed Estimates of Maid Brigade Franchise Costs Based on Item 7 (Estimated Initial Investment) of Maid Brigade’s 2016 Franchise Disclosure Document

1.  Initial Franchise Fee:  $25,000 to $40,000

2.  Real Estate/Office:  $600 to $1,000

  • You must establish and maintain an office outside of your home. Maid Brigade’s approval is required for the size, rent, and location of your office. It is Maid Brigade’s intention to help you properly control rent expense and assure that the space provides all elements required for operation of the business.
  • The cost for your office will vary considerably depending on the size and location of the office, from a negligible amount for a small office in an office park to a substantial amount for a high-visibility office in an office complex, which rarely occurs.
  • The size of your office will vary depending on the type of franchise you purchase ranging from 400 square feet for a territory with at least 25,000 Qualified Households to 900 square feet for a territory with over 40,000 Qualified Households.

3.  Computer Equipment:  $1,000 to $2,000

  • This estimate includes a connection charge to a high speed Internet provider. Maid Brigade will give you a list of computer equipment you will need in order to operate its software program, MicroMaid, and other tools provided as part of its Total Management Software Package.
  • You do not purchase the computer equipment from Maid Brigade.
  • The cost of the equipment you purchase will vary depending on the amount of equipment you buy, the supplier you choose, general economic conditions, your geographic location, and your persistence in obtaining the best prices available.
  • You must have Internet access and email. You may be required to purchase a Personal Digital Assistant that meets Maid Brigade’s specifications.

4.  Equipment, Fixtures, Other Fixed Assets (including leasehold improvements, signs, pre-opening expenses):  $1,500 to $3,000

  • Your costs will vary depending on the size, configuration, and condition of the furniture, supplies, signs, and fixtures you select and the location of your office.

5.  Opening Inventory:  $3,000 to $5,000

  • This represents your Initial Package.

6.  Security Deposits and Other Prepaid Expenses:  $1,500 to $2,000

  • Your landlord will generally require you to pay the first and last months’ rent as a deposit. Utility companies and rental agencies will probably require you to pay deposits and prepaid expenses, including prepaid expenses relating to furniture, fixtures, or equipment you may lease.

7.  Automobile:  $1,700

  • You must use clean, relatively new automobiles for business transportation. The estimate includes the cost of the car wrap, but does not include ongoing gas and maintenance expenses, which you must normally pay on a monthly basis.
  • If you purchase the automobile(s) you use, your initial investment will be significantly greater than the table shows.
  • Maid Brigade requires that your vehicles display the company’s proprietary car wrap, that Maid Brigade specifies from time to time. Maid Brigade’s approved vendors may include the cost of the wrap in the lease or purchase price of the vehicle.

8.  Insurance and Bond:  $1,000 to $2,000

  • The figures shown in the table cover premiums for the insurance you must maintain and the costs you are likely to incur in obtaining a blanket fidelity bond in the amount of $10,000 for each employee.

9.  Training Expenses:  $2,000

  • Maid Brigade does not charge you for its training programs for new franchisees, which consist of Pre-Opening Training, Home Office Training, Mentor Visit Training at an established franchise location, and Blastoff Training at your local office.
  • You are responsible for the travel, food, and lodging expenses you incur when you attend Maid Brigade’s training program and the salary and benefit costs of your attendees. Costs vary due to distances from your location to Maid Brigade’s headquarters, to an established franchise location, and the quality of the food and lodging you choose.

10.  Opening Advertising and Telephone Listing (for the first 3 months):  $12,000 to $13,500

  • Your advertising cost is directly related to the amount and type (brochures, newspaper advertisements, direct mail, Internet, grassroots, networking, car wrap, co-op, etc.) of advertising you conduct.
  • Markets with a minimum of 25,000 Qualified Households must spend a minimum of $48,000 per year, and Markets with a minimum of 40,000 Qualified Households must spend a minimum of $63,600 per year. To the extent that the territory contains more than the minimum number of Qualified Households, your obligation will increase on a pro rata basis.
  • The numbers in the chart above reflect the minimum obligations for the first three months of operation.

11.  Additional Funds (3 months):  $35,700 to $51,800

  • Working capital covers the initial expenses you are likely to incur while you establish the Franchise, and those you are likely to incur between the time you begin providing services and the time you begin having a steady cash flow from payments by customers.
  • These expenses include costs related to performing background checks, hiring employees, initial employee wages, and purchasing other goods and services.
  • Your expenditures will depend on factors like your business skills and experience, general and local economic conditions, competition, the prevailing wage rate, the amount of services you provide during the initial period, how well the business is performing, and the number of hours you are willing to invest in the Franchise.
  • These expenses do not include any draw or salary for the owners of the Franchise, but they do include additional office support services you may need.

12.  Total Estimated Initial Investment:  $85,000 to $124,000

  • In compiling this chart, Maid Brigade relied on its experience in the operation of home cleaning services, and information from its franchisees. The amounts shown are estimates only and may vary for many reasons.
  • Maid Brigade does not offer direct or indirect financing to you for any of these expenses.

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