In this FDD Talk post, you’ll learn the following:
- Section I – Background information on The Maids franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for The Maids franchise, based on Item 7 of the company’s 2018 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for The Maids franchise, based on Items 5 and 6 of the company’s 2018 FDD
- Section IV – Number of franchised and company-owned The Maids outlets at the start of the year and the end of the year for 2015, 2016, and 2017, based on Item 20 of the company’s 2018 FDD
- Section V – Presentation and analysis of The Maids’ financial performance representations, based on Item 19 of the company’s 2018 FDD, including information on the:
- fiscal year 2017 average revenue per clean, average revenue per customer, and average percentage of cleans derived from regular maid service and special projects (one-time cleaning) for the 111 franchisees representing 1,151 territories that were in operation for the 12-month period from October 1, 2016 until September 30, 2017
- fiscal year 2017 high, low, average, and median revenue for the 97 franchisees representing 1,039 territories that were in operation for greater than 48 months, and all 111 franchisees representing 1,151 territories that were in operation for the 12-month period from October 1, 2016 until September 30, 2017
- fiscal year 2017 total revenue, operating expenses, gross margin, general and administrative expenses, and net income for the 8 company stores representing 111 territories that were in operation for the entire year ended September 30, 2017
Section I – Background Information
15 Things You Need to Know About The Maids Franchise
Teams Up With LOOMIS to Enhance Franchisee Marketing Support
1. In late December 2017, The Maids announced that it had selected LOOMIS of Dallas, Texas to help the company enhance its brand initiatives and to develop a strong franchisee marketing support effort. The Maids said that, after conducting a comprehensive review of advertising agencies, it picked LOOMIS because of their depth of experience working with franchise networks across a variety of categories, including the home services category.
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2. Julie Ondrusek, partner and director of client services at LOOMIS, said that the agency specializes in local level support and her team has already begun thinking about how some of the approaches they’ve used for other franchise systems might be adapted for The Maids. She added that LOOMIS’s first task in its new relationship with The Maids “will be to conduct a thorough listening exercise, which will include a great deal of communication with franchisees to learn more about their needs and where [it] can provide the greatest benefit for them.”
DailyPay Announces Partnership With The Maids
3. At the end of April 2017, DailyPay, a financial technology company, announced its new national partnership with The Maids. Through the partnership, employees of The Maids can now receive their wages instantly through DailyPay. By using DailyPay, The Maids employees can immediately access their earned but unpaid wages.
4. DailyPay said that the companies came together to “combat the financial burden caused by the delay that arises from weekly or bi-weekly pay schedules.” According to the Society for Human Resource Management (SHRM), financial stress is the leading cause of employee turnover (which costs companies up to $4,000 per employee). DailyPay’s mission is to help companies reduce turnover by mitigating their employees’ financial hardships.
5. Jason Lee, chief executive officer of DailyPay, said, “When employees achieve financial security at a job, they stay longer.” He added that DailyPay is “thrilled to bring this benefit to The Maids, a historic brand and one of the premiere franchise businesses in America.” Ashley Williams, general counsel and head of human resources at The Maids, said that integrating DailyPay’s system into The Maids’ current pay process was simple and didn’t cost the company any money.
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The Maids in Plano and Scottsdale Update Their Websites
6. In early February 2018, The Maids Plano in Collin County, Texas relaunched its website with a new design. The website highlights the cleaning company’s array of cleaning services, including recurring and one-time maid services, all in a clean and modern design. The new website is easier to navigate and customers can find what they’re looking for quickly.
7. In addition to highlighting The Maids’ recurring and one-time house cleaning services, the new website has additional resources for customers, including information about what to look for when hiring a maid service, customer reviews, a comparison to other cleaning companies, and more. The website was developed by Locallogy, a digital marketing agency that specializes in creating websites for residential cleaning companies.
8. Bob White, owner of The Maids Plano, said, “We wanted something that would help our website stand out from the competition here in Collin County. The new design gives people a visual representation of the high-quality cleaning services we offer.”
9. Locallogy also redesigned the website of The Maids of Scottsdale, Arizona at the end of 2017. The Scottsdale location’s new website is similar to the revamped Plano site. One of the new additions to the Scottsdale website is the location pages, which include the most popular areas around Scottsdale. The pages allow customers to see which areas are serviced by The Maids – locations include Anthem, Care Free, Cave Creek, Fountain Hills, and Paradise Valley.
10. Bob Jackson, owner of The Maids of Scottsdale, said, “We felt it was time for an upgrade from our old site. The new site gives us that modern and clean design we were looking for.”
11. The Maids was founded in 1979 by Daniel J. Bishop in his hometown of Omaha, Nebraska. Bishop had already successfully started his own business before the age of 21 with his janitorial company, Bishop Building Services. Bishop started The Maids because he wanted to bring deep cleaning services to residential areas.
12. After doing extensive research, Bishop determined that the most efficient way to clean a house was through team cleaning. He established the brand’s signature four-person cleaning teams based on four primary functions: dusting, bathroom cleaning, kitchen cleaning, and vacuuming.
13. In 1995, The Maids became the first cleaning company to clean for health, which was accomplished by using environmentally preferable cleaning products and a state-of-the-art backpack vacuum cleaner – the vacuum cleaners were developed especially for The Maids.
14. Bishop started franchising The Maids brand in 1981 and today there are over 1,340 locations in the United States and Canada.
Entrepreneur’s Franchise 500
15. The Maids has appeared on Entrepreneur’s annual Franchise 500 list every year for the past 10 years. The brand’s highest rank was No. 36 in 2017, while its lowest rank rank was No. 48 in 2009.
Section II – Estimated Costs
- Please click here for detailed estimates of The Maids franchise costs, based on Item 7 of the company’s 2018 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on The Maids’ initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2018 FDD.
Section IV – Number of Franchised and Company-Owned Outlets
For the fiscal year ended September 30
- Outlets at the Start of the Year: 1,131
- Outlets at the End of the Year: 1,135
- Net Change: +4
- Outlets at the Start of the Year: 1,135
- Outlets at the End of the Year: 1,191
- Net Change: +56
- Outlets at the Start of the Year: 1,191
- Outlets at the End of the Year: 1,240
- Net Change: +49
- Outlets at the Start of the Year: 34
- Outlets at the End of the Year: 73
- Net Change: +39
- Outlets at the Start of the Year: 73
- Outlets at the End of the Year: 69
- Net Change: -4
- Outlets at the Start of the Year: 69
- Outlets at the End of the Year: 111
- Net Change: +42
Section V – Financial Performance Representations (Item 19, 2018 FDD) and Analysis
- Below is certain historic financial information regarding The Maids businesses operated by franchisees (“Franchisees”) or company-owned stores (“Company Stores”) that operated within the United States and Canada from October 1, 2016 through September 30, 2017.
- Canadian Franchisees submitted information in Canadian Dollars and The Maids converted that information to U.S. Dollars using the exchange rate in place at the time the information was submitted.
- The Maids has not presented any information for Franchisees that were not in operation for the full period.
- You should be aware that some of the Franchisees whose results were used to prepare this information have been in business for a long time, have had a greater opportunity to achieve these results than a new office operated by a new Franchisee, and it’s unlikely that a new Franchisee will achieve results like those reported.
- As of September 30, 2017, there were a total of 1,351 franchised and company-owned territories. A total of 124 Franchisees licensed and operated 1,240 of the 1,351 territories. The Maids operated the remaining 111 territories.
- A The Maids territory generally consists of approximately 10,000 Potential Customers, although some territories may be larger.
- The information presented in this report does not distinguish between Franchisees that purchased a large number of territories and those that did not purchase a large number of territories.
- The basis for the Franchisee information presented is weekly reports submitted to The Maids by its Franchisees and Company Stores operating throughout the periods represented, that form the basis for royalty payments.
- Of the 6,785 total weekly reports required from Franchisees, 3.3% or 224 were not received in time for the preparation of this statement and, therefore, could not be included in calculating the information presented.
Part 1 – Statement of Average Revenue Per Clean, Average Revenue Per Customer, and Percentage of Clean by Service by Franchisee and Territory
- The following statements are based on information reported by Franchisees that were in operation for the 12-month period from October 1, 2016 until September 30, 2017.
- There were 123 Franchisees operating in 1,240 territories as of September 30, 2017. Of those Franchisees, 118 operating in 1,178 territories were in operation for the entire 12-month period ended September 30, 2017.
- The Maids did not include information for the 5 Franchisees operating in 62 territories that were not in operation for the entire 12-month period ending September 30, 2017, or for the 7 Franchisees operating in 27 territories who did not submit complete reports.
- The statement includes the average revenue per clean, the average annual revenue per customer, and the percentage of total cleans by service for a regular maid service or special projects.
Regular Maid Service