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 2019 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 2019 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 2016, 2017, and 2018, based on Item 20 of the company’s 2019 FDD
- Section V – Presentation and analysis of The Maids’ financial performance representations, based on Item 19 of the company’s 2019 FDD, including information on the:
- fiscal year 2018 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 106 franchisees representing 1,148 territories that were in operation for the 12-month period from October 1, 2017 until September 30, 2018
- fiscal year 2018 high, low, average, and median revenue for the 106 franchisees representing 1,148 territories that were in operation for the 12-month period from October 1, 2017 until September 30, 2018
- fiscal year 2018 total revenue, service expenses, operating margin, administrative expenses, and net income for the 7 company stores representing 105 territories that were in operation for the full 12-month period from October 1, 2017 until September 30, 2018
Section I – Background Information
15 Things You Need to Know About The Maids Franchise
Partners with Mr. Clean
1. In early September 2018, Mr. Clean, a pioneer and leading innovator in the cleaning category, announced that it has granted The Maids an exclusive license to use the Mr. Clean brand and icon in its promotions, advertising, and sales materials. Prior to the announcement, the two brands had been working for several months collaborating on a unique partnership to bring Mr. Clean into home services.
2. Consumers will benefit from the cleaning expertise of The Maids with the added muscle of the legendary Mr. Clean. Through the co-brand partnership, consumers can have confidence selecting The Maids, a professional house cleaning service “certified” by Mr. Clean – a service that will meet their needs, budget, and high expectations for a beautifully maintained home.
3. Kevin Wenzel, an associate brand director for Mr. Clean, said, “We’ve spent decades building the Mr. Clean brand and we didn’t want to trust it with just anyone. We did research into the brands in the home cleaning space and The Maids really stood out. The Maids were our number one choice to approach as a partner. We found The Maids has a great national presence, an outstanding brand and a dedication to quality service.”
4. Colin Bishop, president and CEO of The Maids International, added, “The new license agreement with Mr. Clean allows us to bring some muscle to The Maids and expand our product mix. Through our research we found consumers have inherent trust and confidence in the Mr. Clean brand, and he’s a highly recognized figure in cleaning. We couldn’t be more excited to be partnering with such a well-known brand icon and Procter & Gamble.”
New Location in South Miami
5. The Maids continues to open new locations in North America and one of its newest stores opened in South Miami, Florida in early March 2019. The new franchise is owned and operated by Jerome and Nellie Garcia. Jerome is an entrepreneur and franchise owner in the Garcias’ native France and Nellie has a background in office work for the French government.
6. With The Maids, Jerome will focus on business operations while Nellie will focus her time with employees in the field. The Garcias say they are looking forward to the challenge and excitement of running a new business together while providing an elite service to the residents of their community. Nellie said, “We plan to provide extra touches to our customers’ homes to make them feel valued as a customer.”
7. In preparation for the grand opening, Jerome and Nellie spent nearly two weeks completing an extensive administrative and technical training program at The Maids’ corporate headquarters in Omaha, Nebraska, as well as six weeks of training prior to their arrival, and additional training with staff in the local office.
8. Jerome added, “We are a family-owned business and are excited to provide high-quality, detail-oriented cleaning services to our community to make our customers’ lives easier.”
Ranked No. 69 on Entrepreneur’s 2019 Franchise 500 List
9. In mid-February 2019, The Maids announced that it had once again ranked on Entrepreneur magazine’s Franchise 500, the world’s first and most comprehensive franchise ranking. Recognized as an invaluable resource for potential franchisees, the Franchise 500 ranked The Maids as No. 69 for its outstanding performance in areas including unit growth, financial strength and stability, and brand power.
10. Colin Bishop, president and CEO of The Maids International, franchisor of The Maids, said, “We are honored and excited to once again receive this acknowledgment from Entrepreneur. Like the Franchise 500 ranking, this year The Maids also celebrates 40 years of providing healthy living environments for our customers and their families. As a franchise network, we take great pride in being identified by Entrepreneur as a top franchise, regardless of industry.”
11. The key factors that go into the evaluation include costs and fees, size and growth, support, brand strength, and financial strength and stability. Each franchise is given a cumulative score based on an analysis of more than 150 data points, and the 500 franchises with the highest cumulative scores become the Franchise 500 in ranking order.
12. Jason Feifer, editor-in-chief of Entrepreneur, said, “As we celebrate 40 years of producing the Franchise 500, it’s a good opportunity to step back and look at how much has changed since that first ranking in 1980. While the franchise business model has changed little, the strongest franchise brands are constantly evolving and innovating to keep up with changing trends and technology.”
13. The Maids was founded in 1979 by Daniel J. Bishop in Omaha, Nebraska. Bishop was already a self-made entrepreneurial success; he had started his own janitorial company, Bishop Building Services, at the age of 21. After his success with Bishop Building Services, Bishop decided to enter the residential cleaning sector with The Maids.
14. From the start, The Maids focused on residential deep cleaning for time-starved, busy families. With four-person cleaning teams and a recognizable yellow company car, Bishop’s new cleaning business was an immediate success. In 1980, Bishop began franchising The Maids concept and there are now locations in major cities across the United States and Canada.
15. According to The Maids, the company is the first residential cleaning business to focus on cleaning for health. The Maids researched environmentally-preferable cleaning products and sourced state-of-the-art equipment, based on commercial cleaning practices, to ensure the same cleaner, healthier environment was achievable in the home. These advancements set a new standard for quality cleaning and revolutionized the residential cleaning industry.
Section II – Estimated Costs
- Please click here for detailed estimates of The Maids franchise costs, based on Item 7 of the company’s 2019 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 2019 FDD.
Section IV – Number of Franchised and Company-Owned Outlets
For the fiscal year ended September 30
- Outlets at the Start of the Year: 1,135
- 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: 1,240
- Outlets at the End of the Year: 1,255
- Net Change: +15
- 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
- Outlets at the Start of the Year: 111
- Outlets at the End of the Year: 142
- Net Change: +31
Section V – Financial Performance Representations (Item 19, 2019 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, 2017 through September 30, 2018.
- 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, 2018, there were a total of 1,397 franchised and company-owned territories. A total of 116 Franchisees licensed and operated 1,255 of the 1,397 territories. The Maids operated the remaining 142 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 6,032 total weekly reports required from Franchisees, 2.1% or 127 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, 2017 until September 30, 2018.
- There were 116 Franchisees operating in 1,255 territories as of September 30, 2018. Of those Franchisees, 109 operating in 1,161 territories were in operation for the entire 12-month period ended September 30, 2018.
- The Maids did not include information for the 7 Franchisees operating in 94 territories that were not in operation for the entire 12-month period ending September 30, 2018, or for the 3 Franchisees operating in 13 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