Mosquito Squad: $451K Average Sales vs. $164K-$217K Franchise Cost

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

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

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

Section III – Number of franchised and company-owned Mosquito Squad 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 Mosquito Squad franchise opportunity

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

• 2022 aggregate, average, median, highest, and lowest territory gross revenue for the 208 Mosquito Squad territories that were open and operating for the entire 2022 fiscal year

• 2022 average, median, lowest average, and highest average cost per lead for the 80 Mosquito Squad franchisees (representing 171 territories) that reported information using Mosquito Squad’s CRM platform, and submitted a year-end profit and loss statement (“P&L”)

• 2022 average, median, lowest average, and highest average cost per sale for the 80 Mosquito Squad franchisees (representing 171 territories) that reported information using Mosquito Squad’s CRM platform, and submitted a year-end P&L

• 2022 average, median, lowest average, and highest average close rate for the 80 Mosquito Squad franchisees (representing 171 territories) that reported information using Mosquito Squad’s CRM platform, and submitted a year-end P&L

• 2022 average, median, lowest average, and highest average renewal rate for the 80 Mosquito Squad franchisees (representing 171 territories) that reported information using Mosquito Squad’s CRM platform, and submitted a year-end P&L

• 2022 average, median, lowest, and highest gross revenue per service appointment for the 80 Mosquito Squad franchisees (representing 171 territories) that reported information using Mosquito Squad’s CRM platform, and submitted a year-end P&L

• 2022 average, median, lowest average, and highest average gross revenue per customer for the 80 Mosquito Squad franchisees (representing 171 territories) that reported information using Mosquito Squad’s CRM platform, and submitted a year-end P&L

• 2015-2022 aggregate gross revenue (“systemwide sales”) reported by all Mosquito Squad franchisees whose Mosquito Squad franchised businesses were operational for any part of the respective fiscal year and Mosquito Squad’s company-owned outlets for the fiscal years 2016 through 2022, and the respective percentage increase from the prior fiscal year

• 2022 total gross revenue, cost of goods sold, gross profit, operating expenses, and net operating income for the 14 company-owned Mosquito Squad territories operating in Massachusetts, New Hampshire, and Rhode Island combined into a single presentation

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

Section I – Mosquito Squad Franchise Costs

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

• Franchise Fee:  $50,000
• Travel and Living Expenses While Training:  $1,000 to $1,500
• Business Outfitting Fee:  $9,500
• Operations Outfitting Fee:  $2,000
• Truck Outfitting Fee:  $4,000
• Tools and Equipment:  $1,000 to $1,500
• Computer Systems:  $800 to $2,000
• Software:  $305 to $580
• Inventory:  $1,200 to $6,500
• Storage Facility for Inventory and Equipment:  $0 to $3,600
• Insurance:  $7,000 to $7,500
• Professional Fees:  $1,070 to $2,140
• Vehicle:  $0 to $6,000
• Vehicle Signage:  $2,400 to $2,800
• Telephone Services:  $400 to $700
• Leasehold Improvements and Lease Deposits:  $0
• Additional Funds for 12 Months:  $83,855 to $116,805
• Total Estimated Mosquito Squad Franchise Costs:  $164,530 to $217,125

Section II – Mosquito Squad’s Initial Franchise Fee, Royalty Fee, and Marketing Fee

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

• Franchise Fee:  $27,500 to $50,000

• Royalty Fee:  the greater of (a) the Applicable Percentage, or (b) the Minimum Royalty. The “Applicable Percentage” means (i) 10% with respect to your first $250,000 of Gross Revenue in the then-current calendar year, plus (ii) 9% with respect to Gross Revenue in excess of $250,000 and up to $500,000 in the then-current calendar year, plus (iii) 8% with respect to Gross Revenue in excess of $500,000 in the then-current calendar year.

• The Minimum Royalty is determined from the following applicable schedule:

• Standard Territory:

• First 12-Month Period:  none
• Second 12-Month Period:  $650 per month
• Third 12-Month Period:  $950 per month
• Fourth 12-Month Period:  $1,500 per month
• Fifth 12-Month Period:  $1,800 per month
• Sixth 12-Month Period:  $2,100 per month
• Seventh 12-Month Period:  $2,400 per month
• Eighth 12-Month Period:  $2,700 per month
• Ninth 12-Month Period Through the Balance of the Term:  $3,000 per month

• Micro Territory:

• First 12-Month Period:  none
• Second 12-Month Period:  $400 per month
• Third 12-Month Period:  $600 per month
• Fourth 12-Month Period:  $950 per month
• Fifth 12-Month Period:  $1,100 per month
• Sixth 12-Month Period:  $1,250 per month
• Seventh 12-Month Period:  $1,400 per month
• Eighth 12-Month Period:  $1,700 per month
• Ninth 12-Month Period Through the Balance of the Term:  $2,000 per month

• Brand Fund Contribution:  you are required to contribute to the Brand Fund in accordance with the following schedule:

• First 12-Month Period:  $150 per month
• Second 12-Month Period:  $200 per month
• Third 12-Month Period:  $250 per month
• Fourth 12-Month Period:  $300 per month
• Fifth 12-Month Period:  $350 per month
• Sixth 12-Month Period:  $400 per month
• Seventh 12-Month Period Through the Balance of the Term:  $450 per month

• Local Marketing Fee and/or Cooperative:  starting on the Original Opening Date, you are required to pay Mosquito Squad an amount equal to the greater of: (i) $35,000; or (ii) 10% of the preceding calendar year’s Gross Revenue, up to an annual cap of $50,000 per calendar year for Local Marketing

Section III – Number of Franchised and Company-Owned Mosquito Squad Outlets

Franchised

2020

• Outlets at the Start of the Year:  227
• Outlets at the End of the Year:  220
• Net Change:  -7

2021

• Outlets at the Start of the Year:  220
• Outlets at the End of the Year:  223
• Net Change:  +3

2022

• Outlets at the Start of the Year:  223
• Outlets at the End of the Year:  215
• Net Change:  -8

Company-Owned

2020

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

2021

• Outlets at the Start of the Year:  1
• Outlets at the End of the Year:  15
• Net Change:  +14

2022

• Outlets at the Start of the Year:  15
• Outlets at the End of the Year:  15
• Net Change:  0

Section IV – News Updates on the Mosquito Squad Franchise

• Mosquito Squad Announces Four New Territories

• Mosquito Squad’s Flying High with 2023 Q2 Success

• Authority Brands Signed 190 Franchise Agreements to Expand Across More Than 421 New Franchise Territories Systemwide in 2023

• Authority Brands Sees Continued Success with Innovation, Franchise Openings, and New Deals in Second Quarter of 2023

• Authority Brands Expands Portfolio of Home Service Companies and Looks Ahead to a Successful 2023

• Mosquito Squad Did Not Rank on Entrepreneur’s 2024 Franchise 500 List

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

• In this Item 19, Mosquito Squad presents certain historical information for franchised Mosquito Squad businesses for the 2022 fiscal year and prior years.

• As of December 31, 2022, Mosquito Squad had 102 franchisees operating in 215 territories.

• The data in this Item from the period before May 14, 2021 was collected by the franchisor’s predecessor, MSQ.

Part 1 – Gross Revenue Per Territory and Year-Over-Year Growth, by Quartile

• Part 1 includes 208 territories that were open and operating for the entire 2022 fiscal year.

• The table excludes 5 territories that opened during the fiscal year, 13 territories that ceased operations during the fiscal year, and 2 territories that did not report a full fiscal year of Gross Revenue.

Quartile 1 (Top 25%)

• Number of Territories:  52
• Aggregate Territory Gross Revenue:  $55,618,754
• Average Territory Gross Revenue:  $1,069,591
• Median Territory Gross Revenue:  $908,514
• Highest Territory Gross Revenue:  $3,241,536
• Lowest Territory Gross Revenue:  $605,188
• Number and Percent of Territories Exceeding Average:  17 (33%)

Quartile 2 (26-50%)

• Number of Territories:  52
• Aggregate Territory Gross Revenue:  $22,698,441
• Average Territory Gross Revenue:  $436,508
• Median Territory Gross Revenue:  $431,558
• Highest Territory Gross Revenue:  $591,126
• Lowest Territory Gross Revenue:  $309,631
• Number and Percent of Territories Exceeding Average:  23 (44%)

Quartile 3 (51-75%)

• Number of Territories:  52
• Aggregate Territory Gross Revenue:  $11,231,125
• Average Territory Gross Revenue:  $215,983
• Median Territory Gross Revenue:  $213,772
• Highest Territory Gross Revenue:  $306,751
• Lowest Territory Gross Revenue:  $143,348
• Number and Percent of Territories Exceeding Average:  24 (46%)

Quartile 4 (Bottom 25%)

• Number of Territories:  52
• Aggregate Territory Gross Revenue:  $4,396,645
• Average Territory Gross Revenue:  $84,551
• Median Territory Gross Revenue:  $87,673
• Highest Territory Gross Revenue:  $138,779
• Lowest Territory Gross Revenue:  $22,265
• Number and Percent of Territories Exceeding Average:  27 (52%)

Total

• Number of Territories:  208
• Aggregate Territory Gross Revenue:  $93,944,964
• Average Territory Gross Revenue:  $451,658
• Median Territory Gross Revenue:  $308,191
• Highest Territory Gross Revenue:  $3,241,536
• Lowest Territory Gross Revenue:  $22,265
• Number and Percent of Territories Exceeding Average:  72 (35%)

• Part 2 through Part 7 below represent 80 franchisees (representing 171 territories) that reported information using Mosquito Squad’s CRM platform, and submitted a year-end profit and loss statement (“P&L”).

• The tables exclude 22 franchisees representing 44 territories where a full year P&L was not submitted.

• Some franchisees operated multiple territories; in these instances, Mosquito Squad combined the Gross Revenue data for all territories owned by that franchisee.

• The 171 is inclusive of territories that were opened (5) or closed (10) during the fiscal year under existing franchisees that continue to operate.

Part 2 – Cost Per Lead Average

• Part 2 below sets forth the average cost that a franchisee spent in marketing dollars to generate a prospective customer.

• The “Cost Per Lead” is determined by dividing the franchisee’s total marketing spend for the fiscal year by the total number of prospective customers.

• A “Prospective Customer” is defined as any person who contacts the franchisee, and the franchisee enters that person’s contact information into the CRM system as a new customer, meaning the customer had not been in the system in the prior year.

• The franchisees are ranked by lowest Cost Per Lead average.

Quartile 1 (Top 25%)

• Number of Franchisees:  20
• Number of Territories:  29
• Cost Per Lead Average:  $65
• Median Cost Per Lead:  $72
• Highest Cost Per Lead Average:  $105
• Lowest Cost Per Lead Average:  $2
• Number and Percent of Franchisees Exceeding Average:  9 (45%)

Quartile 2 (26-50%)

• Number of Franchisees:  20
• Number of Territories:  45
• Cost Per Lead Average:  $125
• Median Cost Per Lead:  $124
• Highest Cost Per Lead Average:  $142
• Lowest Cost Per Lead Average:  $105
• Number and Percent of Franchisees Exceeding Average:  11 (55%)

Quartile 3 (51-75%)

• Number of Franchisees:  20
• Number of Territories:  48
• Cost Per Lead Average:  $164
• Median Cost Per Lead:  $166
• Highest Cost Per Lead Average:  $185
• Lowest Cost Per Lead Average:  $144
• Number and Percent of Franchisees Exceeding Average:  10 (50%)

Quartile 4 (Bottom 25%)

• Number of Franchisees:  20
• Number of Territories:  49
• Cost Per Lead Average:  $219
• Median Cost Per Lead:  $216
• Highest Cost Per Lead Average:  $275
• Lowest Cost Per Lead Average:  $193
• Number and Percent of Franchisees Exceeding Average:  12 (60%)

Total

• Number of Franchisees:  80
• Number of Territories:  171
• Cost Per Lead Average:  $142
• Median Cost Per Lead:  $143
• Highest Cost Per Lead Average:  $275
• Lowest Cost Per Lead Average:  $2
• Number and Percent of Franchisees Exceeding Average:  40 (50%)

Part 3 – Cost Per Sale Average

• Part 3 below sets forth the average cost that a franchisee spent in marketing dollars to generate a new customer.

• The “Cost Per Sale” is determined by dividing the franchisee’s total marketing spend for the fiscal year by the total number of new customers in the CRM system.

• A “New Customer” is defined as a prospective customer who received at least 1 service appointment from a franchisee.

• A “Service Appointment” is defined as the application of a pesticide treatment at a property.

• The franchisees are ranked by the lowest Cost Per Sale average.

Quartile 1 (Top 25%)

• Number of Franchisees:  20
• Number of Territories:  30
• Cost Per Sale Average:  $138
• Median Cost Per Sale:  $155
• Highest Cost Per Sale Average:  $216
• Lowest Cost Per Sale Average:  $7
• Number and Percent of Franchisees Exceeding Average:  9 (45%)

Quartile 2 (26-50%)

• Number of Franchisees:  20
• Number of Territories:  36
• Cost Per Sale Average:  $252
• Median Cost Per Sale:  $242
• Highest Cost Per Sale Average:  $296
• Lowest Cost Per Sale Average:  $218
• Number and Percent of Franchisees Exceeding Average:  13 (65%)

Quartile 3 (51-75%)

• Number of Franchisees:  20
• Number of Territories:  53
• Cost Per Sale Average:  $354
• Median Cost Per Sale:  $351
• Highest Cost Per Sale Average:  $407
• Lowest Cost Per Sale Average:  $307
• Number and Percent of Franchisees Exceeding Average:  11 (55%)

Quartile 4 (Bottom 25%)

• Number of Franchisees:  20
• Number of Territories:  52
• Cost Per Sale Average:  $561
• Median Cost Per Sale:  $521
• Highest Cost Per Sale Average:  $1,392
• Lowest Cost Per Sale Average:  $413
• Number and Percent of Franchisees Exceeding Average:  15 (75%)

Total

• Number of Franchisees:  80
• Number of Territories:  171
• Cost Per Sale Average:  $326
• Median Cost Per Sale:  $302
• Highest Cost Per Sale Average:  $1,392
• Lowest Cost Per Sale Average:  $7
• Number and Percent of Franchisees Exceeding Average:  45 (56%)

Part 4 – Close Rate Average

• Part 4 below sets forth the average close rate for the included franchisees in 2022.

• The “Close Rate Average” is determined by dividing the franchisee’s total number of New Customers as reported in the CRM system by the total number of Prospective Customers as reported in the CRM system.

• A “Prospective Customer” is defined as a newly contacted customer from a lead received by the franchisee.

• The franchisees are ranked by the highest Close Rate Average.

Quartile 1 (Top 25%)

• Number of Franchisees:  20
• Number of Territories:  36
• Close Rate Average:  62%
• Median Close Rate:  59%
• Highest Close Rate Average:  78%
• Lowest Close Rate Average:  56%
• Number and Percent of Franchisees Exceeding Average:  7 (35%)

Quartile 2 (26-50%)

• Number of Franchisees:  20
• Number of Territories:  44
• Close Rate Average:  50%
• Median Close Rate:  50%
• Highest Close Rate Average:  55%
• Lowest Close Rate Average:  48%
• Number and Percent of Franchisees Exceeding Average:  10 (50%)

Quartile 3 (51-75%)

• Number of Franchisees:  20
• Number of Territories:  47
• Close Rate Average:  44%
• Median Close Rate:  44%
• Highest Close Rate Average:  47%
• Lowest Close Rate Average:  39%
• Number and Percent of Franchisees Exceeding Average:  9 (45%)

Quartile 4 (Bottom 25%)

• Number of Franchisees:  20
• Number of Territories:  44
• Close Rate Average:  33%
• Median Close Rate:  35%
• Highest Close Rate Average:  39%
• Lowest Close Rate Average:  15%
• Number and Percent of Franchisees Exceeding Average:  13 (65%)

Total

• Number of Franchisees:  80
• Number of Territories:  171
• Close Rate Average:  47%
• Median Close Rate:  47%
• Highest Close Rate Average:  78%
• Lowest Close Rate Average:  15%
• Number and Percent of Franchisees Exceeding Average:  40 (50%)

Part 5 – Renewal Rate Average

• Part 5 below sets forth the average renewal rate for the included franchisees in 2022.

• The “Renewal Rate” is determined by dividing the franchisee’s total number of renewal customers as reported in the CRM system by the total number of prior year customers as reported in the CRM system.

• A “Renewal Customer” is defined as a customer who received at least 1 Service Appointment (SA) in 2021 and who received at least 1 SA in 2022.

• A “Prior Year Customer” is defined as any customer who received a SA in 2021 but not in the 2022 fiscal year.

• The franchisees are ranked by the highest Renewal Rate average.

Quartile 1 (Top 25%)

• Number of Franchisees:  20
• Number of Territories:  45
• Renewal Rate Average:  76%
• Median Renewal Rate:  75%
• Highest Renewal Rate Average:  82%
• Lowest Renewal Rate Average:  74%
• Number and Percent of Franchisees Exceeding Average:  6 (30%)

Quartile 2 (26-50%)

• Number of Franchisees:  20
• Number of Territories:  35
• Renewal Rate Average:  72%
• Median Renewal Rate:  71%
• Highest Renewal Rate Average:  74%
• Lowest Renewal Rate Average:  69%
• Number and Percent of Franchisees Exceeding Average:  8 (40%)

Quartile 3 (51-75%)

• Number of Franchisees:  20
• Number of Territories:  51
• Renewal Rate Average:  67%
• Median Renewal Rate:  67%
• Highest Renewal Rate Average:  69%
• Lowest Renewal Rate Average:  65%
• Number and Percent of Franchisees Exceeding Average:  10 (50%)

Quartile 4 (Bottom 25%)

• Number of Franchisees:  20
• Number of Territories:  40
• Renewal Rate Average:  58%
• Median Renewal Rate:  60%
• Highest Renewal Rate Average:  65%
• Lowest Renewal Rate Average:  33%
• Number and Percent of Franchisees Exceeding Average:  14 (70%)

Total

• Number of Franchisees:  80
• Number of Territories:  171
• Renewal Rate Average:  68%
• Median Renewal Rate:  69%
• Highest Renewal Rate Average:  82%
• Lowest Renewal Rate Average:  33%
• Number and Percent of Franchisees Exceeding Average:  45 (56%)

Part 6 – Gross Revenue Per Service Appointment Average

• Part 6 below sets forth the average Gross Revenue per SA for the included franchisees in 2022.

• The “Gross Revenue Per SA” is determined by dividing the total Gross Revenue generated in 2022 by the total number of SAs in 2022 as reported in the CRM system.

• The franchisees are ranked by the highest Gross Revenue Per SA average.

Quartile 1 (Top 25%)

• Number of Franchisees:  20
• Number of Territories:  47
• Average Gross Revenue Per Service Appointment:  $130
• Median Gross Revenue Per Service Appointment:  $114
• Highest Gross Revenue Per Service Appointment:  $353
• Lowest Gross Revenue Per Service Appointment:  $104
• Number and Percent of Franchisees Exceeding Average:  4 (20%)

Quartile 2 (26-50%)

• Number of Franchisees:  20
• Number of Territories:  41
• Average Gross Revenue Per Service Appointment:  $92
• Median Gross Revenue Per Service Appointment:  $92
• Highest Gross Revenue Per Service Appointment:  $103
• Lowest Gross Revenue Per Service Appointment:  $84
• Number and Percent of Franchisees Exceeding Average:  10 (50%)

Quartile 3 (51-75%)

• Number of Franchisees:  20
• Number of Territories:  40
• Average Gross Revenue Per Service Appointment:  $78
• Median Gross Revenue Per Service Appointment:  $77
• Highest Gross Revenue Per Service Appointment:  $84
• Lowest Gross Revenue Per Service Appointment:  $72
• Number and Percent of Franchisees Exceeding Average:  9 (45%)

Quartile 4 (Bottom 25%)

• Number of Franchisees:  20
• Number of Territories:  43
• Average Gross Revenue Per Service Appointment:  $60
• Median Gross Revenue Per Service Appointment:  $64
• Highest Gross Revenue Per Service Appointment:  $72
• Lowest Gross Revenue Per Service Appointment:  $34
• Number and Percent of Franchisees Exceeding Average:  14 (70%)

Total

• Number of Franchisees:  80
• Number of Territories:  171
• Average Gross Revenue Per Service Appointment:  $90
• Median Gross Revenue Per Service Appointment:  $84
• Highest Gross Revenue Per Service Appointment:  $353
• Lowest Gross Revenue Per Service Appointment:  $34
• Number and Percent of Franchisees Exceeding Average:  32 (40%)

Part 7 – Revenue Per Customer Average

• Part 7 below sets forth the average Gross Revenue per customer for the included franchisees in 2022.

• The “Gross Revenue Per Customer” is determined by dividing the total Gross Revenue generated in 2022 by the sum of New Customers plus Renewal Customers during 2022 as reported in the CRM system.

• The franchisees are ranked by the highest Gross Revenue Per Customer average.

Quartile 1 (Top 25%)

• Number of Franchisees:  20
• Number of Territories:  57
• Gross Revenue Per Customer Average:  $958
• Median Gross Revenue Per Customer:  $809
• Highest Gross Revenue Per Customer Average:  $2,489
• Lowest Gross Revenue Per Customer Average:  $756
• Number and Percent of Franchisees Exceeding Average:  4 (20%)

Quartile 2 (26-50%)

• Number of Franchisees:  20
• Number of Territories:  48
• Gross Revenue Per Customer Average:  $663
• Median Gross Revenue Per Customer:  $654
• Highest Gross Revenue Per Customer Average:  $751
• Lowest Gross Revenue Per Customer Average:  $588
• Number and Percent of Franchisees Exceeding Average:  8 (40%)

Quartile 3 (51-75%)

• Number of Franchisees:  20
• Number of Territories:  32
• Gross Revenue Per Customer Average:  $566
• Median Gross Revenue Per Customer:  $566
• Highest Gross Revenue Per Customer Average:  $584
• Lowest Gross Revenue Per Customer Average:  $543
• Number and Percent of Franchisees Exceeding Average:  9 (45%)

Quartile 4 (Bottom 25%)

• Number of Franchisees:  20
• Number of Territories:  34
• Gross Revenue Per Customer Average:  $453
• Median Gross Revenue Per Customer:  $482
• Highest Gross Revenue Per Customer Average:  $541
• Lowest Gross Revenue Per Customer Average:  $272
• Number and Percent of Franchisees Exceeding Average:  12 (60%)

Total

• Number of Franchisees:  80
• Number of Territories:  171
• Gross Revenue Per Customer Average:  $660
• Median Gross Revenue Per Customer:  $586
• Highest Gross Revenue Per Customer Average:  $2,489
• Lowest Gross Revenue Per Customer Average:  $272
• Number and Percent of Franchisees Exceeding Average:  29 (36%)

Part 8 – Systemwide Sales

• Part 8 reports the aggregate Gross Revenue reported by (a) all Mosquito Squad franchisees whose Mosquito Squad franchised businesses were operational for any part of the respective fiscal year and (b) Mosquito Squad’s company-owned outlets for the fiscal years 2016 through 2022 (“Systemwide Sales”) and the respective percentage increase from the prior fiscal year (“Year-Over-Year Growth Percentage”).

• 2015:  $18,504,321
• 2016:  $34,087,166 (Year-Over-Year Growth Percentage: 84%)
• 2017:  $44,984,880 (Year-Over-Year Growth Percentage: 32%)
• 2018:  $57,062,339 (Year-Over-Year Growth Percentage: 27%)
• 2019:  $69,880,191 (Year-Over-Year Growth Percentage: 22%)
• 2020:  $81,165,912 (Year-Over-Year Growth Percentage: 16%)
• 2021:  $100,743,563 (Year-Over-Year Growth Percentage: 24%)
• 2022:  $114,525,713 (Year-Over-Year Growth Percentage: 14%)

Part 9 – Gross Revenue and Selected Operating Expenses for Certain Company-Owned Territories

• Part 9 reports the 2022 Gross Revenue and certain Operating Expenses for the 14 company-owned territories operating in Massachusetts, New Hampshire, and Rhode Island combined into a single presentation.

• The company-owned territories report Gross Revenue on an individual territory basis but share operating expenses. The P&L is reported into a single presentation to show an accurate representation of the entire operation without assumptions made on the proper allocation of expenses across the individual locations.

• These company-owned territories are each governed by a franchise agreement with Mosquito Squad and generally have a population size equivalent to a standard territory.

• Excluded from the table is one company-owned territory in Georgia as it is an atypical operation, meaning the territory size is smaller than Mosquito Squad’s typical territory size and is used primarily as a support resource for corporate and franchisee training.

Total Gross Revenue:  $19,944,544 (100.0%)

Cost of Sales

• Personnel Costs – Technicians:  $4,706,287 (23.6%)
• Marketing Costs:  $1,732,982 (8.7%)
• Program Costs:  $2,498,323 (12.5%)
• Products Costs:  $951,855 (4.8%)
• Total Cost of Goods Sold:  $9,889,447 (49.6%)

Gross Profit:  $10,055,097 (50.4%)

Operating Expenses

• Personnel Expenses – Admin:  $2,365,374 (11.9%)
• Travel Expenses:  $55,373 (0.3%)
• Professional Fees Expenses:  $587,865 (2.9%)
• Facilities Expenses:  $859,599 (4.3%)
• Insurance Expenses:  $353,019 (1.8%)
• Office Expenses:  $283,558 (1.4%)
• Other Operating Expenses:  $636 (0.0%)
• Total Operating Expenses:  $4,505,424 (22.6%)

Net Operating Income:  $5,549,673 (27.8%)

EBITDA Percentage:  27.8%

• “Total Gross Revenue” is defined as the Gross Revenue in Gross Revenue – Services.

• “Gross Revenue – Services” includes only Gross Revenue derived from an SA.

• “Personnel Costs – Technicians” is defined as payroll for technicians and includes taxes and benefits costs. Costs for recruiting, training, and employee relations are also included.

• “Marketing Costs” is defined as costs for promoting the business including Brand Fund Contributions, digital advertising, print, and other advertising methods. This does not include any salaries related to advertising.

• “Program Costs” is defined as the costs related to the operation of the business and providing services including vehicle-related costs (insurance, gas, lease payments, and repairs), Royalty Fee payments, and Call Center fees.

• “Product Costs” is defined as the cost of all product purchased. The products in this category include technician uniforms, safety equipment, software, chemicals, equipment and equipment rental, permits, and inspections.

• “Total Cost of Goods Sold” is defined as the sum of Personnel Costs – Technicians, Marketing Costs, Program Costs, and Product Costs.

• “Gross Profit” is defined as the Total Gross Revenue minus the Total Cost of Sales.

• “Personnel Expenses – Admin” is defined as expenses that include payroll for all team managers; accounting and sales salaries, training, and employee relations are also included.

• “Travel Expenses” is defined as expenses related to travel including transportation, lodging, meals, and entertainment.

• “Professional Fees Expenses” is defined as expenses for legal advice, accounting services, and other professional services.

• “Facilities Expenses” is defined as the expenses related to the facility the business is operated from and includes payments for rent, utilities, maintenance, supplies, and taxes.

• “Insurance Expenses” is defined as the expenses related to insurance premiums for general liability, property, workers compensation, and umbrella insurance policies.

• “Office Expenses” is defined as the expenses related to office-related materials, supplies, and equipment, including cleaning, telephones, shipping, and other office materials, equipment, and supplies.

• “Other Operating Expenses” is defined as other expenses related to bad debt or past due payments from customers.

• “Total Operating Expenses” is defined as the sum of Personnel Costs – Admin, Travel Expenses, Professional Fees Expenses, Facilities Expenses, Insurance Expenses, Office Expenses, and Other Operating Expenses.

• “Net Ordinary Income” is defined as the difference between Gross Profit and Total Operating Expenses.

• “EBITDA Percentage” is defined as Net Ordinary Income divided by Total Gross Revenue.

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

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