Molly Maid Franchise: Average Sales ($855K) vs. Cost ($133K-$191K)

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

Section I – Estimated initial investment (franchise costs) for a Molly Maid franchise, based on Item 7 of the company’s 2023 FDD

Section II – Initial franchise fee, royalty fee, and marketing fee for a Molly Maid franchise, based on Items 5 and 6 of the company’s 2023 FDD

Section III – Number of franchised and company-owned Molly Maid outlets at the start of the year and the end of the year for 2020, 2021, and 2022, based on Item 20 of the company’s 2023 FDD

Section IV – News updates on the Molly Maid franchise opportunity

Section V – Presentation and analysis of Molly Maid’s financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2023 FDD, including information on the:

• 2022 average, median, highest, and lowest gross sales per cleaning for the top 10%, 1st quartile, 2nd quartile, 3rd quartile, 4th quartile, bottom 10%, and all 202 Molly Maid operators (operating a total of 455 businesses), which were all in operation and reporting sales during the entire Reporting Period (January 1, 2022 to December 31, 2022)

• 2022 average, median, highest, and lowest gross sales per target household for the top 10%, 1st quartile, 2nd quartile, 3rd quartile, 4th quartile, bottom 10%, and all 202 Molly Maid operators (operating a total of 455 businesses), which were all in operation and reporting sales during the entire Reporting Period (January 1, 2022 to December 31, 2022)

• percentage of cleans performed in 2022 for recurring customers versus percentage of cleans performed in 2022 for occasional customers for all 202 Molly Maid operators (operating a total of 455 businesses), which were all in operation and reporting sales during the entire Reporting Period (January 1, 2022 to December 31, 2022)

Section VI – Key ratios, comparables, computations, and analyses for the Molly Maid franchise opportunity (exclusive content for Platinum subscribers)

Section I – Molly Maid Franchise Costs

• Molly Maid franchise costs, based on Item 7 of the company’s 2023 FDD:

• Initial Franchise Fee:  $14,900
• Territory Fee:  $45,000 to $70,000
• Initial Startup Package:  $3,500 to $5,000
• Software Enrollment and Training Fee:  $1,500
• Auto Lease Deposit and 3 Months’ Lease Expense:  $3,000 to $5,500
• Computer Hardware:  $2,000 to $4,000
• Leasehold Improvements:  $1,000 to $5,000
• Real Estate, Utility Deposits, and 3 Months’ Rent:  $4,000 to $6,000
• Furniture, Fixtures, and Equipment:  $2,500 to $3,500
• Permits and Licenses:  $100 to $1,000
• Insurance Deposit and 3 Months’ Insurance Expense:  $2,200 to $5,300
• Training Expenses for Travel, Food, and Lodging:  $4,000 to $5,000
• Professional Fees:  $0 to $5,000
• Additional Funds for 3 Months:  $50,000 to $60,000
• Total Estimated Molly Maid Franchise Costs:  $133,700 to $191,700

Section II – Molly Maid’s Initial Franchise Fee, Royalty Fee, and Marketing Fee

• Molly Maid’s initial franchise fee, royalty fee, and marketing fee, based on Items 5 and 6 of the company’s 2023 FDD:

• Initial Fees:  Initial Franchise Fee of $14,900; Territory Fee of $1 per Target Household in your Territory
• License Fee:  3 to 6 ½% of Gross Sales, except for “roll-in” sales. In addition, minimum license fees apply.
• Marketing, Advertising, and Promotion (MAP) Contribution:  the then-current fee (currently, 2% of Gross Sales per week per Molly Maid Franchise Agreement that you have entered into with Molly Maid)
• Local Marketing Requirement:  $1 per Target Household per year, which declines as Gross Sales increase, to a minimum of $0.15 per Target Household if criteria are met
• Local Marketing Groups:  not to exceed 3% of Gross Sales

Section III – Number of Franchised and Company-Owned Molly Maid Outlets

Franchised

2020

• Outlets at the Start of the Year:  493
• Outlets at the End of the Year:  497
• Net Change:  +4

2021

• Outlets at the Start of the Year:  497
• Outlets at the End of the Year:  501
• Net Change:  +4

2022

• Outlets at the Start of the Year:  501
• Outlets at the End of the Year:  481
• Net Change:  -20

Company-Owned

2020

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

2021

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

2022

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

Section IV – News Updates on the Molly Maid Franchise

• Molly Maid Cleans Up With New Sales Record

• Molly Maid Launches Contest to Find the Nation’s Messiest Kids and Pets

• Molly Maid Announces Nationwide Holiday Clean Home Giveaway

• Molly Maid Ranked No. 142 on Entrepreneur’s 2023 Franchise 500 List

Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Molly Maid Franchise (Item 19, 2023 FDD)

• The following tables are a historic financial performance representation about a subset of the franchise system’s existing outlets’ past performance during the calendar year beginning on January 1, 2022 and ending on December 31, 2022 (the “Reporting Period”) and are not a forecast of your future financial performance.

• Neither Molly Maid nor its independent certified public accountants have audited or verified any of the sales figures reported to it. Franchise owners are not required to use generally accepted accounting principles when reporting these figures.

• As of December 31, 2022, there were 481 open Molly Maid franchises in the United States. These franchises were owned and operated by 217 franchise owners (collectively, “Operators”).

• The tables in this Item 19 include data from 202 Operators (“Reporting Franchisees”) representing 455 franchised businesses, which were all in operation and reporting sales during the entire Reporting Period.

• The tables in this Item 19 exclude data from (a) 5 businesses that opened during the Reporting Period and therefore were not operating and reporting data for the entire Reporting Period; (b) 20 businesses that were resold during the Reporting Period and so were not operating and reporting data for the entire Reporting Period; and (c) 1 business that did not report reliable data for the Reporting Period.

• Twenty-five businesses closed during the Reporting Period and therefore did not report data for the entire Reporting Period and so they are also excluded from this Item 19. Of the 25 businesses that closed during the Reporting Period, no business closed after being open for less than 12 months.

• For purposes of the representations below, “Gross Sales” means the total revenues and receipts from whatever source (whether in the form of cash, credit, agreement to pay, barter, trade, or other consideration) that arise, directly or indirectly, from the operation of – or in connection with – a Molly Maid franchised business, whether under any of the Marks or otherwise.

• Gross Sales exclude sales taxes collected from customers and paid to the appropriate taxing authority and any other bona fide refunds, rebates, or discounts that Molly Maid authorizes in writing. Gross Sales also exclude sales from any Excluded Services (as defined in a mutually executed Excluded Services Addendum).

Part 1 – 2022 Average and Median Gross Sales Per Cleaning

• The table below in this Part 1 shows the average and median Gross Sales per service (i.e., cleaning) data for the 2022 Reporting Period for all Reporting Franchisees. The Reporting Franchisees are divided into groups based on the level of Reporting Franchisee’s Average Gross Sales Per Cleaning achieved during the Reporting Period (i.e., top 10%, 1st, 2nd, 3rd, and 4th quartile, bottom 10%, and all (100%)).

Top 10%

• Average Gross Sales Per Cleaning:  $222
• Highest Gross Sales Per Cleaning:  $255
• Lowest Gross Sales Per Cleaning:  $209
• Median Gross Sales Per Cleaning:  $220
• Number of Reporting Franchisees in Group:  20
• Number and Percent in Group That Attained the Average or Greater:  8 / 40%

1st Quartile

• Average Gross Sales Per Cleaning:  $205
• Highest Gross Sales Per Cleaning:  $255
• Lowest Gross Sales Per Cleaning:  $187
• Median Gross Sales Per Cleaning:  $201
• Number of Reporting Franchisees in Group:  50
• Number and Percent in Group That Attained the Average or Greater:  22 / 44%

2nd Quartile

• Average Gross Sales Per Cleaning:  $174
• Highest Gross Sales Per Cleaning:  $186
• Lowest Gross Sales Per Cleaning:  $165
• Median Gross Sales Per Cleaning:  $173
• Number of Reporting Franchisees in Group:  51
• Number and Percent in Group That Attained the Average or Greater:  25 / 49%

3rd Quartile

• Average Gross Sales Per Cleaning:  $156
• Highest Gross Sales Per Cleaning:  $164
• Lowest Gross Sales Per Cleaning:  $149
• Median Gross Sales Per Cleaning:  $156
• Number of Reporting Franchisees in Group:  50
• Number and Percent in Group That Attained the Average or Greater:  22 / 44%

4th Quartile

• Average Gross Sales Per Cleaning:  $138
• Highest Gross Sales Per Cleaning:  $149
• Lowest Gross Sales Per Cleaning:  $89
• Median Gross Sales Per Cleaning:  $142
• Number of Reporting Franchisees in Group:  51
• Number and Percent in Group That Attained the Average or Greater:  32 / 63%

Bottom 10%

• Average Gross Sales Per Cleaning:  $129
• Highest Gross Sales Per Cleaning:  $89
• Lowest Gross Sales Per Cleaning:  $89
• Median Gross Sales Per Cleaning:  $134
• Number of Reporting Franchisees in Group:  21
• Number and Percent in Group That Attained the Average or Greater:  13 / 62%

100%

• Average Gross Sales Per Cleaning:  $169
• Highest Gross Sales Per Cleaning:  $255
• Lowest Gross Sales Per Cleaning:  $89
• Median Gross Sales Per Cleaning:  $164
• Number of Reporting Franchisees in Group:  202
• Number and Percent in Group That Attained the Average or Greater:  86 / 43%

• Molly Maid calculated the average and median Gross Sales Per Cleaning as follows: (i) first, Molly Maid calculated the average Gross Sales Per Cleaning during the Reporting Period for each Reporting Franchisee, based on information provided by the Reporting Franchisees to Molly Maid through its Software System (the “Individual Business Average Gross Sales Per Cleaning”) and then (ii) Molly Maid calculated the average and median of all Reporting Franchisees’ Individual Business Average Gross Sales Per Cleaning during the Reporting Period.

Part 2 – 2022 Average and Median Gross Sales Per Target Household

• The table below in this Part 2 shows the average and median Gross Sales per Target Household (TH) data for the Reporting Period for all Reporting Franchisees.

• The Reporting Franchisees are divided into groups based on the level of Reporting Franchisee’s Average Gross Sales Per Target Household (TH) achieved during the Reporting Period (i.e., top 10%, 1st, 2nd, 3rd, and 4th quartile, bottom 10%, and all (100%)).

• “Target Household” or “TH” for each Operator refers to the total number of Target Households specified in each of the Operator’s Franchise Agreements, or if any of the Operator’s Franchise Agreements do not identify the Target Households, then the total number of Target Households that Molly Maid calculates (using third-party mapping software) based on the Operator’s territory size under each of the Operator’s Franchise Agreements.

Top 10%

• Average Gross Sales Per TH:  $46
• Highest Gross Sales Per TH:  $94
• Lowest Gross Sales Per TH:  $32
• Median Gross Sales Per TH:  $38
• Number of Operators in Group:  20
• Number and Percent in Group That Attained the Average or Greater:  7 / 35%

1st Quartile

• Average Gross Sales Per TH:  $35
• Highest Gross Sales Per TH:  $94
• Lowest Gross Sales Per TH:  $23
• Median Gross Sales Per TH:  $30
• Number of Operators in Group:  50
• Number and Percent in Group That Attained the Average or Greater:  14 / 28%

2nd Quartile

• Average Gross Sales Per TH:  $19
• Highest Gross Sales Per TH:  $23
• Lowest Gross Sales Per TH:  $16
• Median Gross Sales Per TH:  $18
• Number of Operators in Group:  52
• Number and Percent in Group That Attained the Average or Greater:  24 / 46%

3rd Quartile

• Average Gross Sales Per TH:  $14
• Highest Gross Sales Per TH:  $16
• Lowest Gross Sales Per TH:  $11
• Median Gross Sales Per TH:  $14
• Number of Operators in Group:  50
• Number and Percent in Group That Attained the Average or Greater:  24 / 48%

4th Quartile

• Average Gross Sales Per TH:  $8
• Highest Gross Sales Per TH:  $11
• Lowest Gross Sales Per TH:  $3
• Median Gross Sales Per TH:  $9
• Number of Operators in Group:  50
• Number and Percent in Group That Attained the Average or Greater:  29 / 58%

Bottom 10%

• Average Gross Sales Per TH:  $6
• Highest Gross Sales Per TH:  $8
• Lowest Gross Sales Per TH:  $3
• Median Gross Sales Per TH:  $7
• Number of Operators in Group:  21
• Number and Percent in Group That Attained the Average or Greater:  12 / 57%

100%

• Average Gross Sales Per TH:  $19
• Highest Gross Sales Per TH:  $94
• Lowest Gross Sales Per TH:  $3
• Median Gross Sales Per TH:  $16
• Number of Operators in Group:  202
• Number and Percent in Group That Attained the Average or Greater:  71 / 35%

• Molly Maid calculated the average and median Gross Sales Per Target Household as follows: (i) first, Molly Maid calculated the average Gross Sales Per Target Household during the Reporting Period for each Reporting Franchisee, based on information provided by the Reporting Franchisees to Molly Maid through its Software System (the “Individual Franchisee Average Gross Sales Per Target Household”) and (ii) then Molly Maid calculated the average and median of all Reporting Franchisees’ Individual Franchisee Average Gross Sales Per Target Household during the Reporting Period.

Part 3 – Recurring and Occasional Customers

• The table below in this Part 3 shows the percentage of services (i.e., cleanings) provided by Reporting Franchisees during the Reporting Period that were performed for recurring customers versus the percentage of services/cleanings performed for occasional customers.

• Recurring customers are customers for whom a franchisee provided at least two cleanings during the Reporting Period.

Recurring Customers

• Average Percentage of Cleanings Performed for This Type of Customer:  90%
• Median Percentage of Cleanings Performed for This Type of Customer:  91%
• Number of Reporting Franchisees:  202
• Number and Percent of Reporting Franchisees at or Above the Average:  117 / 58%

Occasional Customers

• Average Percentage of Cleanings Performed for This Type of Customer:  10%
• Median Percentage of Cleanings Performed for This Type of Customer:  9%
• Number of Reporting Franchisees:  202
• Number and Percent of Reporting Franchisees at or Above the Average:  85 / 42%

Part 4 – Percentage Increase from Year 2021 to Year 2022 in Annual Gross Sales

• The table below in this Part 4 shows the percentage increase from year 2021 to year 2022 in annual Gross Sales of Reporting Franchisees that were in business and reporting sales for the entire 12 months in both year 2022 and year 2021, which represents 195 of the 202 Reporting Franchisees, which Reporting Franchisees operated the same 447 franchised businesses in both year 2021 and year 2022.

• The 7 excluded Reporting Franchisees were not in business for a full year in 2021.

Gross Sales Growth 2022 vs. 2021

• More Than 20%:  59 Reporting Franchisees (30% of Reporting Franchisees)
• More Than 10% and up to 20%:  57 Reporting Franchisees (29% of Reporting Franchisees)
• More Than 5% and up to 10%:  33 Reporting Franchisees (17% of Reporting Franchisees)
• More Than 0% and up to 5%:  19 Reporting Franchisees (10% of Reporting Franchisees)

Gross Sales Decline 2022 vs. 2021

• More Than 0% and up to 5%:  11 Reporting Franchisees (6% of Reporting Franchisees)
• More Than 5% and up to 10%:  5 Reporting Franchisees (3% of Reporting Franchisees)
• More Than 10% and up to 20%:  8 Reporting Franchisees (4% of Reporting Franchisees)
• More Than 20%:  3 Reporting Franchisees (2% of Reporting Franchisees)

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

Section VI – Molly Maid Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️