In this FDD Talk post, you’ll learn the following:
- Section I – Background information on the Merry Maids franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a Merry Maids franchise, based on Item 7 of the company’s 2017 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Merry Maids franchise, based on Items 5 and 6 of the company’s 2017 FDD
- Section IV – Presentation and analysis of Merry Maids’ financial performance representations, based on Item 19 of the company’s 2017 FDD, including information on the:
- average, median, high, and low annual gross sales during the 3-year period 2014-2016, by quartile, for all Ownership Groups who reported sales for at least 3 years and had an average of over $400,000 in average annual gross sales during the 3-year period 2014-2016
Section I – Background Information
7 Things You Need to Know About the Merry Maids Franchise
One of the First Companies to Sign Up for New Amazon Key Service
1. In late October, Amazon announced that it was launching a new service called Amazon Key that would allow in-home delivery for packages as well as home access for family/friends and service appointments. The service is currently available in 37 U.S. cities and is an Amazon Prime exclusive service. Merry Maids, along with other ServiceMaster brands, was one of the first companies to sign up to use Amazon Key.
2. Nik Varty, CEO of ServiceMaster, said, “Amazon Key will make it even easier to cross a major chore off your to-do list by letting the professionals at Merry Maids take care of the house cleaning while you’re not home. We are thrilled to be teaming up with Amazon so that their customers in need of professional home cleaning services can take advantage of this innovative, convenient and secure service.”
Awards Top Franchisees at 2017 International Franchise Convention
3. Merry Maids held its annual International Franchise Convention in September in Phoenix, Arizona where it handed out its top honors. Mary Kay Wegner, president of ServiceMaster’s franchise services group, said, “We have a strong team of franchisees at Merry Maids, and it was a pleasure to recognize the best of the best. They are growing their businesses, building loyal relationships with their customers, and building a successful future for themselves and their employees. They’re leaders in our network, and I appreciate their passion to provide outstanding service every day.”
4. The company gave out the following awards:
- Merry Maids Founder Award – This award is based on customer service, growth, sales, operations, and team member development, and is the highest honor given to a U.S. franchisee. It went to Brad Smith of Conyers and Locust Grove, Georgia.
- Merry Maids Team Member of the Year – This award is given to a U.S. team member who consistently delivers exceptional service and is a positive ambassador for the Merry Maids brand. Judy Mwea of Merry Maids Towson, Maryland received the award this year and was selected from over 8,000 team members.
- Merry Maids Rookie of the Year – Brad and Lisa Davis, owners of the Merry Maids franchise in Olive Branch, Mississippi topped all new franchisees in posting the highest revenue growth in their first 26 weeks of business.
- Sales Growth Leader and Single Territory Sales Leader Award – This honor went to Scott and Susan Tanner of Victoria, British Columbia.
- Multiple Territory Sales Leader Award – Brad and Lisa Dionne, owners of franchises in eight territories in California, Idaho, Utah, and Washington, earned the top sales growth award among all multiple territory owners.
5. Merry Maids was founded in 1979 by Dallen Peterson in Omaha, Nebraska. Over the next year, Peterson worked with his family to develop the Merry Maids system. Franchising officially began in 1980.
6. The Petersons continued to grow the company over the next few years and in 1988, ServiceMaster purchased Merry Maids from the Petersons. ServiceMaster is the parent company of several other home service industry franchises, including Terminix, American Home Shield, Amerispec, Furniture Medic, ServiceMaster Restore, and ServiceMaster Clean. Today, there are over 1,600 Merry Maid locations around the world.
Entrepreneur’s Franchise 500
7. Merry Maids has ranked on Entrepreneur’s annual Franchise 500 list every year for the past 10 years. The company’s highest rank was No. 33 in 2017, while its lowest rank was No. 66 in 2012.
Section II – Estimated Costs
- Please click here for detailed estimates of Merry Maids franchise costs, based on Item 7 of the company’s 2017 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on Merry Maids’ initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2017 FDD.
Section IV – Financial Performance Representations (Item 19, 2017 FDD) and Analysis
- The following financial performance representation consists of historical data for Merry Maids franchised branches for residential cleaning services in the United States of America. The franchisor has not included data from similar franchises in Canada or any other foreign country or territory.
- Many franchisees have more than one franchise agreement related to their business. Franchisees with multiple franchises typically do not have separate operations for each franchise agreement. Therefore, the franchisor has aggregated data based on “Ownership Groups” to more accurately reflect a franchisee’s business.
- There are 280 Ownership Groups that reported revenue for Residential Cleaning Services in 2014, 2015, and 2016.
- The tables below include Ownership Groups with at least $400,000 in annual gross sales from Residential Cleaning Services. Of the 280 Ownership Groups, 213 (or 76%) had average annual gross sales of at least $400,000 attributable to Residential Cleaning Services during the three-year period 2014-2016.
- Ownership Groups included in the table below have an average of 1.6 franchise agreements per Ownership Group.
- Ownership Groups with an average of less than $400,000 in annual gross sales for Residential Cleaning Services during the three-year period 2014-2016 have been excluded. Ownership Groups with an average of less than $400,000 in annual gross sales account for 6.7% of annual gross sales for all Ownership Groups.
- The franchisor compiled this information from the reported gross sales from franchisees during the last three years, January 2014 through December 2016.
- During 2014, 2015, and 2016, the franchisor divested all except three of its company-owned branch territories to franchised businesses. Revenue from company-owned branches during this 3-year period was not included. Revenue from franchised outlets that were formerly company-owned branches was excluded in the reported franchisee gross sales for this 3-year period.
- The franchisor has not independently verified the information received from franchisees. These financial statements were not prepared in accordance with Generally Accepted Accounting Principles (GAAP), but are believed to be reliable.
Part 1 – Average Annual Gross Sales During the 3-Year Period 2014-2016 By Quartile for All Ownership Groups Who Reported Sales for At Least 3 Calendar Years and Had an Average of Over $400,000 in Average Annual Gross Sales During the 3-Year Period 2014-2016