Ready to buy a cleaning franchise? Here are 6 key questions to ask
Mar 25, 2021
If you’re buying a cleaning franchise there are some important questions to pose to any potential franchisor that should help clarify which business model will suit you best.
Cleaning businesses can be commercial or residential, or specialist – for example carpet or blind cleaning.
In many cases a cleaning franchise is set up for the franchisees themselves to run and operate the business as a sole trader or in a partnership. Some franchised options are built for franchisees to employ staff to clean. The issue for a prospective franchisee is ensuring the right balance between flexibility and profitability.
Six questions to ask
1. What extra costs will there be in setting up in addition to the initial franchise fee?
The franchisee fee is the up-front cost paid to the franchisor and it covers the use of the brand name and the business system. Find out what’s included in the franchise package – for instance, is the price of training factored in to the package, will you need to purchase equipment separately, are any consumables included in the cost?
2. What are the regular outgoings?
You’ll be paying a monthly franchise fee, and that might be a fixed amount, or a variable cost dependent on revenue. Understanding the payment structure is crucial to your budget forecasting.
As a franchisee you’ll have access to marketing tools and campaigns, and will pay a monthly fee for these.
Depending on the business model, there may be staff salaries to pay and, if so, these will form a large part of your expenses.
If you need to operate the business from a shopfront or office, there will be rental costs to factor in to the outgoings.
What about equipment repairs or updates? Find out how often these take place and an estimate of the costs involved.
3. How will I make a profit?
Does the franchise focus on one service to bring in income or is there a second or third revenue stream available – perhaps secondary services or cleaning products?
How many clients will you need to service in one day/week to ensure you are making the profit you want? Remember to include travelling time between jobs when estimating how many clients can be booked in a day, and cost in any admin time you need to generate clients, chase invoices, market the business or roster staff.
4. What administrative support do you provide?
Some franchisors will be set up to add value to their franchise package by taking over some or all of the admin required to maintain your business. Will your franchisor be sending you leads and chasing invoices? Will your franchisor provide digital tools so you can keep on top of your bookings and marketing?
5. How will I find clients?
As mentioned above, franchisors in the services sector may source clients for their franchisees using a call centre or online enquiry system. Some franchisors may be able to deliver national clients with local franchisees servicing their neighbourhood offices.
If you need to employ your own resources to find clients, it’s worth finding out from existing franchisees the best ways to achieve this, and calculate how much time is required each week to keep the pipeline going.
6. How can I expand the business?
A successful franchisee is often keen to take the next step and expand the business. So what does this look like in your shortlisted franchise? If you purchase a territory when you buy the business, can you sell off part of this to another franchisee, can you buy multiple areas as you grow your business?
The appeal of a cleaning business is often it’s low-cost investment, and the simplicity of the business model. However, it’s always important to find answers to the above questions so you can accurately gauge the true costs of operating the business and whether you will have the financial returns, and support, you need to achieve your goals.