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

• Section I – Background information on The Junkluggers franchise opportunity, including relevant news updates

• Section II – Estimated initial investment for The Junkluggers franchise, based on Item 7 of the company’s 2021 FDD

• Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for The Junkluggers franchise, based on Items 5 and 6 of the company’s 2021 FDD

• Section IV – Number of franchised and company-owned The Junkluggers outlets at the start of the year and the end of the year for 2018, 2019, and 2020, based on Item 20 of the company’s 2021 FDD

• Section V – Presentation and analysis of The Junkluggers’ financial performance representations, based on Item 19 of the company’s 2021 FDD, including information on the:

• 2020 actual and average revenue, year-over-year revenue, and average job revenue for the 17 franchised The Junkluggers units that were in operation for the entire 2019 and 2020 calendar years

• average monthly gross revenues during the 1st month of operation, 6th month of operation, and 10th month of operation for the 24 franchised The Junkluggers units that first commenced operation after January 1, 2020

• 2020 junk removal and moving services annual revenue and Remix Market annual revenue for the one affiliate-owned The Junkluggers unit, which operates in a territory located within the State of Connecticut and within Westchester, New York

• 2020 truck labor costs, net disposal costs, vehicle costs, direct operating costs, insurance costs, operating registrations and taxes, payment processing fees, marketing and advertising costs, professional service fees, general and administrative costs, royalty, call center, brand fund and technology fees, and total costs, as a percentage of annual gross revenues, for the 10 franchised The Junkluggers units that were in operation for the entire 2019 and 2020 calendar years and provided complete, properly categorized responses to the franchisor’s survey requesting specific expense information for the 2020 calendar year

Section I – Background Information

15 Things You Need to Know About The Junkluggers Franchise

Makes World Clean Up Day a Month Long Event

1.  In late August 2021, The Junkluggers announced that it was celebrating World Clean Up Day during the entire month of September – World Clean Up Day was on September 18. The Junkluggers was ready to showcase its mission of keeping reusable items out of landfills in order to maintain a sustainable environment from September 1 through September 30.

2.  During World Clean Up Month, The Junkluggers encouraged everyone to participate in local eco-friendly focused community events or even create their own. The junk removal brand challenged people to live a little greener and show the planet some extra love during the whole month of September.

3.  To kick-off World Clean Up Month, The Junkluggers encouraged everyone to look for local e-waste events to help limit the 75-80% of e-waste that ends up in landfills every year. Another way to get involved in the month-long event was to help with community cleanup events in local areas and bring some friends along. The Junkluggers invited people to try out eco-friendly initiatives that can become a lifelong practice, such as limiting household waste, donating reusable items, and purchasing eco-friendly products.

4.  Josh Cohen, founder and CEO of The Junkluggers, said, “Our mission runs for 365 days a year, but we would love for our communities to devote a whole month to reducing our waste in landfills. We are excited to roll out World Clean Up Month and together we can all make a big impact on our environment.”

5.  Cohen always wanted to find new ways to donate items and reuse products which would have otherwise been thrown in landfills. Since its humble beginnings in 2004, The Junkluggers has donated over one million dollars’ worth of items on behalf of its customers – that means it has been able to keep over 50 million pounds out of landfills and benefited over 100,000 people.

6.  The Junkluggers was the first junk removal company to issue donation receipts to customers because it always donates first. As The Junkluggers continues to grow, it continues to paint the world green. This year alone, the brand has generated over 80% more donation receipts than the same period last year.

7.  As part of The Junkluggers’ ongoing mission, Cohen believes in incorporating eco-friendly practices into his everyday life. He recently introduced a compost to his household that will help eliminate close to everything that goes into their trash, as the rest is thrown into the recycling bin. Part of his ongoing household practice is purchasing items that can be recycled therefore staying eco-friendly both inside and outside of the home. Whether it’s across the nation, in the community or at home, Cohen strives to carry out his mission by keeping items out of landfills.

8.  Kristy Ferguson, chief marketing officer for The Junkluggers, added, “We are always looking for new ways that our local communities can make an impact on the environment that supports our mission to keep items out of landfills. The Junkluggers hope that World Clean Up Month is celebrated and practiced nationwide in the years to come.”

Hauls Away a Wide Array of Items

9.  The Junkluggers offers complete, eco-friendly junk removal for your home or business – including offices, retail locations, construction sites, and more. Aside from certain hazardous materials, Junkluggers says that it can haul away just about anything. Common household items that Junkluggers will take include furniture, appliances, refrigerators, freezers, carpets/rugs, TVs, lawnmower/riding lawnmower, bikes, water heaters/furnaces, tires, rubbish, mattresses, leaf and yard debris, pianos, hot tubs, swingset/playset, basketball hoops, and sheds/pergolas.

10.  The Junkluggers will happily haul off the following office items: countertops, desks, monitor screens, computers, printers, fax machines, shelves and storage, office chairs, fixtures, and office cubicles. Lastly, The Junkluggers will take the following construction materials: masonry products, sinks, concrete, large tree stumps, bricks, logs, fences, ladders, soil/dirt, shingles/tiles, bathtubs, gravel, insulation, pallets, and paint cans.

11.  The Junkluggers will recycle, donate, and upcycle as much of the items as possible. If a customer is unsure if Junkluggers will take a specific item, they can ask any of the company’s junk removal experts as The Junkluggers offers free on-site estimates at no obligation.

Company History

12.  The Junkluggers was founded in 2004 by Josh Cohen in Connecticut. The idea for Junkluggers came to Cohen while he was studying abroad in Australia. One of his friends mentioned that they had made $100 for lugging away a neighbor’s fridge. Cohen felt that he could do this when he returned home to earn some money.

13.  Once Cohen, who was just 21 years old at the time, came home to Connecticut, he began handing out homemade fliers informing his neighbors that he was a professional, responsible college student who was able and willing to donate or recycle as many of their items as he could. Cohen quickly began receiving phone calls requesting his service and he realized that there was a demand for reliable, professional, and environmentally-focused junk removal services.

14.  Cohen began hauling junk with his mom’s SUV and once he had earned enough money, he bought an old dump truck. Demand for Cohen’s junk hauling services grew and he began expanding. Franchising started in 2012. Today, there are The Junkluggers franchises in more than 27 states.

Entrepreneur’s Franchise 500

15.  The Junkluggers did not rank on Entrepreneur’s 2021 Franchise 500 list.

Section II – Estimated Costs

• Please click here for detailed estimates of The Junkluggers franchise costs, based on Item 7 of the company’s 2021 FDD.

Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees

• Please click here for detailed information on The Junkluggers’ initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2021 FDD.

Section IV – Number of Franchised and Company-Owned Outlets

Franchised

2018

• Outlets at the Start of the Year:  18
• Outlets at the End of the Year:  26
• Net Change:  +8

2019

• Outlets at the Start of the Year:  26
• Outlets at the End of the Year:  24
• Net Change:  -2

2020

• Outlets at the Start of the Year:  24
• Outlets at the End of the Year:  43
• Net Change:  +19

Company-Owned

2018

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

2019

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

2020

• 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, 2021 FDD) and Analysis

• As of December 31, 2020, there were 43 franchised businesses in operation (the “Franchised Units”) and 1 affiliate-owned business in operation (the “Affiliate Unit”).

Part 1 – Annual Gross Revenue, Percentage Increase in Gross Revenues Over the Prior Year (“YOY Revenue”), Average Revenue Per Job as of December 31, 2020

• Part 1 shows certain results for the 17 Franchised Units that were in operation for the entire 2019 and 2020 calendar years (the “Part 1 Units”). Specifically, Part 1 shows Annual Gross Revenue for the 2020 calendar year, Annual Revenue Growth (from calendar year 2019 to calendar year 2020), and Average Revenue Per Job for the Part 1 Units for the 2020 calendar year.

Franchise Unit 1

• Revenue 2020:  $4,530,605
• YOY Revenue:  12%
• Average Job Revenue:  $680

Franchise Unit 2

• Revenue 2020:  $1,962,390
• YOY Revenue:  9%
• Average Job Revenue:  $600

Franchise Unit 3

• Revenue 2020:  $1,264,163
• YOY Revenue:  70%
• Average Job Revenue:  $543

Franchise Unit 4 (restructured ownership during the 2020 calendar year)

• Revenue 2020:  $1,106,454
• YOY Revenue:  14%
• Average Job Revenue:  $504

Franchise Unit 5

• Revenue 2020:  $613,823
• YOY Revenue:  52%
• Average Job Revenue:  $398

Franchise Unit 6 (restructured ownership during the 2020 calendar year)

• Revenue 2020:  $609,654
• YOY Revenue:  50%
• Average Job Revenue:  $425

Franchise Unit 7 (transferred to new ownership during the 2020 calendar year)

• Revenue 2020:  $567,179
• YOY Revenue:  48%
• Average Job Revenue:  $399

Franchise Unit 8

• Revenue 2020:  $507,535
• YOY Revenue:  67%
• Average Job Revenue:  $481

Franchise Unit 9

• Revenue 2020:  $443,940
• YOY Revenue:  75%
• Average Job Revenue:  $357

Franchise Unit 10

• Revenue 2020:  $402,286
• YOY Revenue:  30%
• Average Job Revenue:  $339

Franchise Unit 11

• Revenue 2020:  $357,986
• YOY Revenue:  42%
• Average Job Revenue:  $523

Franchise Unit 12

• Revenue 2020:  $345,253
• YOY Revenue:  7%
• Average Job Revenue:  $377

Franchise Unit 13

• Revenue 2020:  $338,312
• YOY Revenue:  106%
• Average Job Revenue:  $582

Franchise Unit 14

• Revenue 2020:  $284,262
• YOY Revenue:  56%
• Average Job Revenue:  $348

Franchise Unit 15

• Revenue 2020:  $258,841
• YOY Revenue:  52%
• Average Job Revenue:  $409

Franchise Unit 16

• Revenue 2020:  $216,704
• YOY Revenue:  -16%
• Average Job Revenue:  $484

Franchise Unit 17 (transferred to new ownership during the 2020 calendar year)

• Revenue 2020:  $167,650
• YOY Revenue:  24%
• Average Job Revenue:  $368

Average Revenue for Part 1 Units

• Revenue 2020:  $822,179
• YOY Revenue:  41.1%
• Average Job Revenue:  $460

• The Part 1 Units operated their franchised businesses in territories that are larger than the Territory you will be awarded under the Franchise Agreement. The total population of the territories in which the Part 1 Units operated during the 2020 calendar year ranged from 600,000 in population to 5,100,000 in population.

• Five of the Part 1 Units utilized one truck in connection with the operation of the franchised business, 9 of the Part 1 Units utilized more than 1 truck and up to 4 trucks, and 3 of the Part 1 Units utilized 6 or more trucks (with the highest number of trucks at 15).

• The Average Revenue Per Truck for the Part 1 Units for the 2020 calendar year, as reported to The Junkluggers by the Part 1 Units, was $232,951.

• The below table reflects the percentage of Gross Revenues for the Part 1 Units for the 2020 calendar year that was attributable to Commercial Revenue.

Commercial Revenue as a Percentage of 2020 Gross Revenue

• Average:  23.3%
• Median:  13.4%
• Highest:  38.2%
• Lowest:  4.7%

• The term “Commercial Revenue” means Gross Revenues derived from commercial jobs.

Part 2 – Average Monthly Gross Revenues for the 24 Franchised Locations That First Commenced Operation After January 1, 2020

• Part 2 shows Average Gross Revenues for 24 Franchised Units that first commenced operations in either the 2020 or 2021 calendar year (the “Part 2 Units”).

• Part 2 excludes performance information for the 4 Franchised Units that commenced operations in either the 2020 calendar year or the 2021 calendar year because these units operated primarily as Contractor Nation dealers and are not reflective of the Franchised Business model.

1st Month of Operation (24 Locations)

• Average Gross Revenues:  $18,834
• Median Gross Revenues:  $16,687
• Highest Gross Revenues:  $35,252
• Lowest Gross Revenues:  $5,510
• Number and Percentage of Units That Achieved or Surpassed the Average:  12 (or 50%)

6th Month of Operation (6 Locations)

• Average Gross Revenues:  $34,717
• Median Gross Revenues:  $30,117
• Highest Gross Revenues:  $60,903
• Lowest Gross Revenues:  $14,796
• Number and Percentage of Units That Achieved or Surpassed the Average:  2 (or 33.3%)

10th Month of Operation (3 Locations)

• Average Gross Revenues:  $61,498
• Median Gross Revenues:  $65,125
• Highest Gross Revenues:  $80,754
• Lowest Gross Revenues:  $38,615
• Number and Percentage of Units That Achieved or Surpassed the Average:  2 (or 66.66%)

Part 3 – Affiliate Gross Revenue for 2020

• Part 3 shows the Annual Gross Revenue for the 2020 calendar year for the Affiliate Unit:

• Junk Removal and Moving Services Annual Revenue:  $3,642,259
• Remix Market Annual Revenue:  $308,131

• The Affiliate Unit has been in operation offering Junk Removal and Moving Services for over 14 years, and Remix Market services for over 5 years.

• The Affiliate Unit operates in a territory located within the State of Connecticut and within Westchester, New York.

Part 4 – Certain Expenses for 2020

• Part 4 shows certain expenses for 10 of the Part 1 Units (the “Part 4 Units”) that provided complete, properly categorized responses to Junkluggers’ survey requesting specific expense information for the 2020 calendar year.

• Of the 17 Part 1 Units, 7 were excluded from the Part 4 results because they either (a) failed to provide financial statements for the entire 2020 calendar year; or (b) provided incomplete financial statements for the 2020 calendar year; or (c) failed to properly categorize expense information.

Average Expense of Franchised Units as a Percentage of Annual Gross Revenues

• Truck Labor Costs:  22.0%
• Net Disposal Costs:  7.4%
• Vehicle Costs:  5.6%
• Direct Operating Costs:  0.7%
• Insurance Costs:  5.9%
• Operating Registrations and Taxes:  0.3%
• Payment Processing Fees:  1.8%
• Marketing and Advertising Costs:  14.5%
• Professional Service Fees:  0.9%
• General and Administrative Costs:  2.9%
• Royalty, Call Center, Brand Fund, and Technology Fees:  13.7%
• Total of Above Costs:  75.5%

• Truck Labor Costs include hourly wages (regular and overtime), performance incentives and bonuses, but does not include payroll taxes or other benefits.

• Net Disposal Costs include dump fees less recycling revenue.

• Vehicle Costs include amounts expended on GPS, tolls, parking, fines and violations, fuel, repairs and maintenance for the vehicles used in connection with the operation of the franchised business.

• Direct Operating Costs include amounts expended on supplies and equipment, wireless plan and devices, uniforms, truck parking, medical expenses and claims in connection with the operation of the Part 4 Units.

• Insurance Costs include amounts expended on commercial automobile, general liability, workers’ compensation, cargo, umbrella, and other insurance coverage expenses.

• Operating Registration and Taxes Costs include amounts expended on supplemental, industry-specific business registration expenses, and commercial motor vehicle taxes in connection with the operation of the Part 4 Units.

• Payment Processing Fees include amounts expended on processing payments, including credit cards, for the business accepted by the Part 4 Units.

• Marketing and Advertising Costs include amounts expended on marketing and advertising by the Part 4 Units.

• Professional Service Fees include amounts expended on payroll and accounting service providers by the Part 4 Units.

• General and Administrative Costs include expenses for human resources, professional and development dues, printing and postage, office supplies and equipment, travel, meals and entertainment, clothing and apparel, software, licenses, permits and fees, service charges, gifts, and bad debt expenses, as reported to have been expended by the Part 4 Units.

• Royalty, Call Center, Brand Fund, and Technology Fees include amounts paid for royalty fees, call center fees, advertising fund contributions, and technology fees, all of which were uniformly imposed as to the Part 4 Units.

• Total of Above Costs is the sum of the average totals.

• Please note that Part 4 does not include all expenses you may incur as a new franchisee, including, but not limited to, debt service, office wages (for operations and/or administrative personnel), office rent and utilities, and other fees paid to The Junkluggers or its affiliate(s).

• The results presented in this Item 19 are not audited and are based on information reported to The Junkluggers by its affiliate and by the Part 1, Part 2, and Part 4 Units. The Junkluggers has not independently audited or verified the reported results.

• Some outlets have earned this amount. Your individual results may differ. There is no assurance that you’ll earn as much.

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