Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

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Franchise Costs: Detailed Estimates of Jan-Pro (Master Franchise) Franchise Costs (2016 FDD)

by Franchise Chatter on January 21, 2017

in Commercial Cleaning Franchise, Franchise Costs

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Detailed Estimates of Jan-Pro (Master Franchise) Franchise Costs Based on Item 7 (Estimated Initial Investment) of Jan-Pro’s 2016 Franchise Disclosure Document

1.  Initial Franchise Fee:  $50,000 to $600,000

2.  Real Estate:  $1,500 to $5,000

  • You must maintain a business office of about 1,500 to 2,000 square feet, which Jan-Pro must approve as to location and décor.
  • You can expect to pay 3 months’ rent when you sign a lease: 1st month, last month, and one month security.
  • You may not operate the franchise from your home.
  • Initial deposits and the costs for the build-out of office space will vary, depending on the office space leased.

3.  Initial Supplies:  $1,500 to $2,000

4.  Equipment and Office Furniture:  $10,000 to $25,000

  • You must purchase, lease, or otherwise acquire a commercial carpet extraction machine, commercial floor polisher, and a commercial wet/dry vacuum and complete starter kit, and provide Jan-Pro proof you have done so on its request.
  • These items are not included in the opening package Jan-Pro furnishes. This equipment is back-up equipment for your Unit Franchisees and you may rent this equipment to your Unit Franchisees.
  • You also must furnish your office space.

5.  Business Licenses and Permits, Deposits, and Other Prepaid Expenses:  $1,000 to $3,000

  • You must obtain all proper business licenses and permits from various state and local agencies before engaging in business.
  • These filing and application fees may range up to $500 each, depending on the location of your franchise.
  • Security deposits and other expenses that must be prepaid also will vary.

6.  Insurance:  $1,000 to $3,000

7.  Training:  $3,000 to $5,000

  • You must pay all your expenses to attend your initial training at Jan-Pro’s corporate training center in Alpharetta, Georgia and/or at one of its Master Franchisee’s offices.
  • Actual costs will depend on the distance traveled, the lodging secured, meals, and the transportation used.

8.  Legal Fees and Registration Expenses:  $1,500 to $10,000

  • You must obtain Jan-Pro’s approval for your form Unit FDD and the standard form Unit Franchise Agreement (which is included in the Unit FDD) for your sale of Unit Franchises.
  • Because these documents are only templates, and have not been customized for your business and/or your state’s laws, you must carefully review, prepare, and add information to these documents regarding you and your franchise, at your expense, to include all disclosures required by law and conform its provisions to law.
  • You are exclusively responsible for complying with all federal and state franchise and business opportunities registration and disclosure laws and the payment of all registration and filing fees.
  • To prepare your Unit FDD and comply with applicable franchise and business opportunities registration and disclosure laws, you may require the services of an attorney.

9.  Computer Hardware and Software:  $5,000 to $10,000

10.  Initial Advertising Expenses:  $3,000 to $5,000

11.  Additional Funds – 6 to 12 Months:  $75,000 to $100,000

  • Additional Funds is an estimate of certain funds needed to cover business (not personal) expenses during the initial months of operation of your business.
  • You will need capital to support on-going costs of your business, such as payroll, utilities, taxes, loan payments, and other expenses, if revenues do not cover business costs.
  • This is only an estimate and Jan-Pro cannot guarantee that the amounts stated will be adequate. You may need additional funds during the initial months of operation or afterwards.
  • The 6 to 12-month period from beginning your business does not mean that you will have reached “break-even,” “positive cash flow,” or any other financial position.
  • In addition, Additional Funds relate only to costs associated with the franchise and cover no owners’ draw or personal, “living,” unrelated business or other expenses you may have.

12.  Total:  $152,500 to $768,000

  • The payments made to third parties may be refundable depending on the terms offered by each third party.
  • These estimates include no finance charges, interest, or debt service obligations.
  • In preparing the figures in this table, Jan-Pro relied on its 17 years of experience in franchising these Master Franchises.
  • The amounts shown are estimates only and may vary for many reasons including the capabilities of your management team, where you locate your Franchise, and your business experience and acumen.

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