Should You Convert Your Business to a Janitorial Franchise?
If you have the lofty goal of expanding your commercial cleaning company in a big way, you've probably toyed with the idea of franchising. Many of our members have asked us if this is an effective way to expand. Our answer? It depends. Every business is different and every business owner has different goals.
Franchising a business is an expensive proposition and it comes with extra legalities and responsibilities some business owners aren't prepared to handle. Before you make a decision about the best way to grow your business, consider the following questions.
Is your business successful enough to serve as a template for other businesses?
This is one of the most important things to consider. In order to be a valuable franchise, your business needs to be successful. You need to be able to provide data to prospective franchisees to show them they can be successful with your business, too. And you won't be able to do it with just one location. You'll need to have at least 2 locations running your successful formula.
Think back to when your business was just starting out. What was your start-up process? Could you replicate your success, or did you just get lucky? As a franchisor, you'd be responsible for helping new franchisees start earning a profit as soon as possible.
How many franchisees will you need to be profitable?
If you're thinking that 5 or 10 locations will bring in the big bucks, think again. Enlist an attorney that specializes in franchise law to determine the ROI of opening a franchise, and how many locations you'll need to make it worth your while.
And while you're determining how many franchises you'll need to be profitable, who is going to enlist franchisees? You'll need a sizeable marketing budget that includes:
- creating a strong online presence
- a Google Adwords budget so you can compete with all the other janitorial franchises
- an advertising budget to publish ads in the franchise magazines
- a strong sales department that can recruit and convert prospects
Why would your franchisees need you?
Once their location is up and running, your franchise owners need a reason to keep paying your franchise fees. You need to do something they can't do on their own. If you're an advertising wiz, you might have great brand recognition and memorable marketing campaigns. Maybe you can provide a hefty discount on supplies or have a secret formula for a cleaning product or process. You might even be able to conduct employee trainings and orientations that are more in-depth and thorough than an independent cleaning company can organize. No matter what you bring to the table, you need to provide enough value that your franchisees can justify the cost of your franchise fees every single year.
Will your business model thrive in any environment?
It's important to know why your business is successful. The most valuable franchises are businesses that can be successful in almost any location. If your business makes a fortune on providing volcanic ash clean-up, your current business may be very successful, but is also limited by your geography. Likewise, if you work in a city with many large medical centers and specialize in cleaning hospitals, your brand is not worth much to a prospective franchisee who may live in a rural area with only one nearby emergency room and clinic. Your business needs to be able to succeed in a wide variety of environments to be a profitable franchise.
Can your success be attributed to a specific factor?
Every business has a unique team of staff members. Each of these staff members has different strengths that they bring to your business. You need to know if your business is successful because of a specific salesperson, marketer, technician, or client. If you worry your business would collapse if you went on vacation, you are not ready to franchise.
How strong are your relationships with vendors?
Many franchises restrict where their franchisees can purchase supplies in order to maintain consistent products and results between locations. If you rely on a specific vendor to run your business, you need to be sure they're able to handle increased demand. In addition, they must be able to provide products to other locations, not just your local city. Navigating these large agreements can be very tricky for business owners who aren't used to negotiating bulk discounts across locations.
Do you have established processes and procedures?
When a franchisee buys their business from you, you'll want to make sure you're giving them as much information as possible. You need step-by-step policies for hiring new staff, onboarding, cleaning, contracts with clients, purchasing, and every other aspect of running your business. This can be a very daunting task for business owners considering franchising their business.
Are you patient enough to work with inexperienced business owners?
One of the draws to purchasing a franchise business instead of starting an independent cleaning company is the assistance provided by you—the experienced entrepreneur. Helping someone start their business can be very rewarding. It does take time, patience, and a lot of hard work.
How involved would you like to be in the day-to-day operations of your cleaning company?
Franchisees report less to their franchisors than managers report to their business owners. As your business grows, you'll need to delegate more tasks to the leadership team you're building within your staff. If you decide to franchise your business, you'll spend more time dealing with high-level administrative tasks than the day-to-day workings of your business. And as a franchisee, you likely won't have much input in the hiring process within franchise locations.
Is your business financially strong enough to cover the initial costs of franchising?
It's substantially less expensive to help 10 business owners start their own cleaning company than to open 10 new locations with your own money. That said, there are still costs to franchising you may not have considered. Most importantly, you'll need to cover the cost of writing the legal documents and contracts you'll sign with franchisees. You'll also need to spend more than you may think on branding, customer service (both for franchisees and for their clients), training programs, marketing materials, and meeting with prospective franchisees.
If any of these questions have you realizing franchising isn't a good fit for you, work on growing your business in another way. Focus on hiring more technicians and taking on extra clients, or open another location to break into a new market.
Growing your cleaning business—no matter how you do it—is hard work. Franchising your business can be a great method of expansion for cleaning company owners who know why their business is successful, can replicate their growth, and want to take a step back to help others grow their businesses.
Do You Need Help with Growing and Running Your Cleaning Business?
The Janitorial Store is a private, members-only resource for those serious about starting, improving and growing a profitable cleaning business. Within the private, members-only area, you'll find a huge selection of in-depth information that you won't find anywhere else on the Internet.
As 30 year veterans of the cleaning industry, we know that the business of cleaning can be incredibly challenging. The competition is fierce and and the margins are low. It's a demanding business and it's tough to grow it and make it successful.is a private, members-only resource for those serious about starting, improving and growing a profitable cleaning business. Within the private, members-only area, you'll find a huge selection of in-depth information that you won't find anywhere else on the Internet.
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