FDD Talk: College Nannies + Sitters + Tutors Franchise Review (Financial Performance Analysis, Costs, Fees, and More)

In this FDD Talk post, you’ll learn the following:

• Section I – Background information on the College Nannies + Sitters + Tutors franchise opportunity, including relevant news updates

• Section II – Estimated initial investment for a College Nannies + Sitters + Tutors franchise, based on Item 7 of the company’s 2018 FDD

• Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a College Nannies + Sitters + Tutors franchise, based on Items 5 and 6 of the company’s 2018 FDD

• Section IV – Number of franchised and company-owned College Nannies + Sitters + Tutors 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 College Nannies + Sitters + Tutors’ financial performance representations, based on Item 19 of the company’s 2018 FDD, including information on the:

• average bill rate, pay rate, and gross margin percentage for nanny placement services, babysitting services, corporate back-up care through national account, tutoring services (customized tutoring and homework help), and tutoring services (ACT/SAT/PSAT college test prep) for the College Nannies + Sitters + Tutors franchise location in St. Paul, MN owned by the franchisor’s affiliate, and for the entire franchise system (separately stated)

• 2017 income, cost of goods sold, gross profit, expenses, and net operating income for the College Nannies + Sitters + Tutors franchise location in St. Paul, MN owned by the franchisor’s affiliate

• first year, second year, and third year revenues, by tier, for all College Nannies + Sitters + Tutors businesses since October 2006 that opened an approved Community Location within 12 months of signing their Franchise Agreement (as required) and were in operation for at least 12 months as of December 31, 2017

Section I – Background Information

9 Things You Need to Know About the College Nannies + Sitters + Tutors Franchise

Offers a Wide Variety of Tutoring Services

1.  In addition to its nanny and babysitting services, College Nannies + Sitters + Tutors also connects families with qualified tutors, who cover a wide range of subjects. College Nannies + Sitters + Tutors guarantees that each child is personally matched with the right tutor for their learning style and individual needs. After a child is matched with the right tutor, they are placed in a flexible, focused Learning Center with all the resources and support they need to improve their testing scores.

2.  The brand’s tutoring services include:

• College Test Prep – Tutors help children get into good colleges through the ACT and SAT test prep program. Students get the one-on-one focus they need to pass their college entrance exams. Tutors will help students maximize their potential and help it shine through on the college entrance exam.

• Essay Writing – College Nannies + Sitters + Tutors recognizes that strong writing skills are essential to academic success. Tutors will help students develop strong writing skills and will also provide help for college application essays.

• Study Skills – Tutors will teach students how to study properly and are also trained to understand the frustration, cut through the clutter, and make learning fun and easy. Tutors will create a customized learning plan designed to improve organizational skills, time management, note-taking, studying and test-taking skills, which are the habits needed to tap a student’s full potential.

• Homework Help – Tutors provide students the help they need to catch up or stay ahead on any subject in a stress-free environment.

• Math – According to studies from education and business groups, math skills are a key indicator of academic performance, overall test scores, and college entrance exam success. College Nannies + Sitters + Tutors provides students with the help they need to succeed in math at any level.

• Science – Science Tutors understand how to make science easy to learn, whether its biology, chemistry, or physics. If a student’s future plans include science, the science tutors are experts in the field, including the areas of medicine, engineering, and research. If a student’s future plans do not include a science focus, it is still a necessary part of the curriculum and the science tutors can help make sense of the labs, elements, and conclusions.

Six Steps to Franchise Ownership

3.  College Nannies + Sitters + Tutors understands that purchasing a business is a big decision and that a great fit has to go both ways. This is why the brand’s franchise ownership process has six steps so both the company as well as potential franchisees have enough information to make their final decision on whether or not a College Nannies + Sitters + Tutors franchise is the right fit.

4.  The six-step process includes:

• Concept Introduction – Potential franchisees view the concept overview webinar and are provided with territory insights/goals. This is also where potential franchisees learn whether or not the brand fits with their interests and personality.

• Technology + Operations Overview – In this step, potential franchisees will view CNet technology webinars and begin review of the franchise disclosure document (FDD).

• Marketing + Recruiting Overview – Potential franchisees will view the brand’s marketing + recruiting webinar. During this step, interested franchisees can see when “meet the team” dates are available.

• Validation – Franchisees will review available markets and territories and complete validation of their networks.

• Executive Review – In the penultimate step, potential franchisees are ready to meet with Joe Keely, founder and CEO of College Nannies + Sitters + Tutors. At this time, the franchise agreement will also be reviewed.

• Meet the Team – As the final step, potential franchisees will visit the national support team and ensure that there’s a cultural fit. If everything goes well, interested franchisees shall be awarded a franchise.

Company History

5.  College Nannies + Sitters + Tutors was founded in 2001 by Joseph Keely in Minnesota. At the time, Keely was a business school student while working as a nanny for two little boys. Keely realized that he was not just a babysitter, but a role model for these kids and he hoped to make a lasting impact on them.

6.  Recognizing a need to connect families with reliable and safe nannies, tutors, and role models (like himself), Keely started conceptualizing College Nannies + Sitters + Tutors. Keely felt that current college students, college graduates, and certified teachers looking to make a positive difference working with children and adolescents were the type of people he wanted to connect families with.

7.  Keely pioneered an efficient way to match the families’ needs with reliable resources and College Nannies + Sitters + Tutors was born. In 2005, Keely began franchising the College Nannies + Sitters + Tutors concept. Since then, the company has expanded on Keeley’s initial award-winning business to become the nation’s most complete full-service nanny and tutor resource.

8.  In 2016, College Nannies + Sitters + Tutors was acquired by Bright Horizons Family of Childcare Solutions and became a wholly-owned subsidiary.

Entrepreneur’s Franchise 500

9. College Nannies + Sitters + Tutors ranked No. 138 on Entrepreneur’s 2019 Franchise 500 list.

Section II – Estimated Costs

• Please click here for detailed estimates of College Nannies + Sitters + Tutors 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 College Nannies + Sitters + Tutors’ 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

Franchised

2015

• Outlets at the Start of the Year:  81
• Outlets at the End of the Year:  102
• Net Change:  +21

2016

• Outlets at the Start of the Year:  102
• Outlets at the End of the Year:  119
• Net Change:  +17

2017

• Outlets at the Start of the Year:  119
• Outlets at the End of the Year:  176
• Net Change:  +57

Company-Owned

2015

• Outlets at the Start of the Year:  1
• Outlets at the End of the Year:  1
• Net Change:  0

2016

• Outlets at the Start of the Year:  1
• Outlets at the End of the Year:  0
• Net Change:  -1

2017

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

Section V – Financial Performance Representations (Item 19, 2018 FDD) and Analysis

Part 1

• In this Part 1, the franchisor has prepared five tables listing the average bill rate, average pay rate, and average gross margin percentage for the College Nannies + Sitters + Tutors franchise location in St. Paul, MN, and using that location’s actual pricing and expense information for the calendar year 2017.

• The St. Paul location is owned by CNT, LLC, which was an affiliate of the franchisor for the first six months of 2016. CNT, LLC was purchased by the franchisor from a franchisee in 2012 and was sold to the franchisor’s former owners in July 2016.

• In Tables 1 to 5 below, the bill rate is the average amount that was charged to customers for the specified type of services, as an hourly rate.

• The pay rate is the average hourly rate that was paid to employees of the St. Paul location who provided the specified services.

• Gross margin percentage is calculated by subtracting the hourly wage paid to the employee and all payroll taxes, workers’ compensation premiums, and payroll processing costs, from the bill rate and dividing the result by the bill rate.

• The tables below include average bill rates, pay rates, and gross margin percentages for the St. Paul location and for the entire franchise system.

• Your bill rate, pay rate, and gross margin percentage may differ.

Table 1 – Nanny Placement Services (including full-time, part-time, and summer nanny services)

St. Paul Location