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

Section I – Estimated initial investment (franchise costs) for a Chem-Dry franchise, based on Item 7 of the company’s 2024 FDD

Section II – Initial franchise fee, royalty fee, and marketing fee for a Chem-Dry franchise, based on Items 5 and 6 of the company’s 2024 FDD

Section III – Number of franchised and company-owned Chem-Dry outlets at the start of the year and the end of the year for 2021, 2022, and 2023, based on Item 20 of the company’s 2024 FDD

Section IV – News updates on the Chem-Dry franchise opportunity

Section V – Presentation and analysis of Chem-Dry’s financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2024 FDD, including information on the:

• 2023 number of owners, number of franchises, average franchises per owner, average and median revenue per owner, average and median revenue per franchise, average and median revenue per job, percentage of owners exceeding average revenue per owner, solutions as a percentage of revenue, and average and median years operating for the top 5%, first quartile, second quartile, third quartile, fourth quartile, bottom 5%, and all 246 Chem-Dry franchise owners who provided their 2023 financial information and have operated their businesses at least 1 year as of January 1, 2023, and then operated those franchises throughout all of 2023

• 2023 number of owners, number of franchises, average franchises per owner, average and median revenue per owner, average and median revenue per franchise, percentage of owners exceeding average revenue per owner, solutions as a percentage of revenue, and average and median years operating for the 246 Chem-Dry franchise owners who provided their 2023 financial information and have operated their businesses at least 1 year as of January 1, 2023, and then operated those franchises throughout all of 2023, grouped by number of franchises owned (franchise owners with 1 franchise owned, franchise owners with 2 franchises owned, and franchise owners with 3 or more franchises owned)

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

Section I – Chem-Dry Franchise Costs

• Initial License Fee:  $23,500
• Initial Package:  $39,495 to $84,495
• Optional Additional Equipment:  $0 to $28,525
• Cargo Van:  $0 to $75,000
• Installation Costs:  $600 to $6,000
• Three Months’ Rent:  $0 to $5,000
• Telephone and Business License:  $400 to $4,000
• Training and Convention Attendance Expenses:  $1,250 to $3,000
• Insurance:  $600 to $7,000
• Additional Funds for 3 Months:  $2,500 to $9,000
• Computer System:  $800 to $2,000
• Advertising for 3 Months:  $3,000 to $5,000 in addition to Brand Marketing Fund contribution
• Optional Digital Advertising and Marketing (startup and 3 months):  $0 to $1,349
• Total Estimated Chem-Dry Franchise Costs:  $72,145 to $253,869

Section II – Chem-Dry’s Initial Franchise Fee, Royalty Fee, and Marketing Fee

• Total Initial Fee:  $62,995 to $107,995
• Monthly Franchise Fee:  $466.01
• Brand Marketing Fund Contribution:  currently $160 per month

Section III – Number of Franchised and Company-Owned Chem-Dry Outlets

Franchised

2021

• Outlets at the Start of the Year:  1,770
• Outlets at the End of the Year:  1,692
• Net Change:  -78

2022

• Outlets at the Start of the Year:  1,692
• Outlets at the End of the Year:  1,437
• Net Change:  -255

2023

• Outlets at the Start of the Year:  1,437
• Outlets at the End of the Year:  1,284
• Net Change:  -153

Company-Owned

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

2023

• 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 Chem-Dry Franchise

Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Chem-Dry Franchise (Item 19, 2024 FDD)

• Chem-Dry does not currently require all its business franchise owners to provide periodic revenue and other financial reports concerning their franchises.

• Chem-Dry’s Customer Management Software has been mandatory for new franchisees since 2013, however franchisees operating under Franchise Agreements signed before the mandatory reporting was implemented in 2013 could previously elect to use the Customer Management Software but were not required by their Franchise Agreements to do so.

• In January 2024, Chem-Dry produced a report on all franchisees currently using its Customer Management Software regarding certain financial and other information relating to the operation of their Chem-Dry business franchises during 2023.

• Some franchise owners operate their Chem-Dry businesses on a part-time basis or are semi-retired, and those operating businesses are different than the full-time Chem-Dry business franchise being offered. To compare the existing Chem-Dry franchised business to the franchise offered accurately, Chem-Dry removed data from the report on franchisees who earned less than $75,000 per year based on their own decisions to operate on a part-time or semi-retired basis.

• Of the remaining franchisees using Chem-Dry’s Customer Management Software, Chem-Dry received 2023 financial information from 246 franchise owners (the “Responding Franchise Owners”), who collectively own 706 Chem-Dry business franchises (the “Responding Franchises”), and who have operated their businesses at least 1 year as of January 1, 2023, and then operated those franchises throughout all of 2023.

• The Responding Franchise Owners represent approximately 41.9%, and the Responding Franchises represent approximately 56.9%, of Chem-Dry’s U.S. franchise owners and franchises who owned their businesses for at least 1 year and operated those franchises throughout all of 2023.

• Chem-Dry has no reason to believe that the franchise owners who use its Customer Management Software, and whose information is incorporated into this financial performance representation, do not reflect a representative sample of all Chem-Dry franchise owners and franchises in the United States who owned their businesses for at least 1 year and operated those franchises throughout all of 2023.

• Chem-Dry believes that the Responding Franchise Owners offer the same products and services that it authorizes new Chem-Dry business franchises to sell. Responding Franchisees have been in business for an average of 20 years in their markets. The Responding Franchises operate in a mix of urban, suburban, and rural areas, and they are disbursed geographically throughout the U.S.

• Listed below are the Number of Owners, Number of Franchises, Average Franchises per Owner, Average Revenue per Owner, Median Revenue per Owner, Average Revenue per Franchise, Median Revenue per Franchise, Average Revenue per Job, Median Revenue per Job, Owners Exceeding Average Revenue per Owner, and the Cost of Cleaning Solution as a percent of Revenue per Franchise as those terms are defined in the notes below, for the Responding Franchise Owners and Responding Franchises during the period from January 1, 2023 until December 31, 2023.

A. 2023 Franchise Data, Groups Ranked by Average Revenue

Top 10%

• Number of Owners:  25
• Number of Franchises:  141
• Average Franchises per Owner:  5.6
• Average Revenue per Owner:  $1,030,995
• Median Revenue per Owner:  $903,593
• Average Revenue per Franchise:  $182,801
• Median Revenue per Franchise:  $173,614
• Average Revenue per Job:  $484.89
• Median Revenue per Job:  $439.96
• Owners Exceeding Average Revenue per Owner:  32%
• Solutions as a % of Revenue:  3.92%
• Average Years Operating:  27.0
• Median Years in Business:  28.2

1st Quartile

• Number of Owners:  62
• Number of Franchises:  292
• Average Franchises per Owner:  4.7
• Average Revenue per Owner:  $736,831
• Median Revenue per Owner:  $641,881
• Average Revenue per Franchise:  $156,450
• Median Revenue per Franchise:  $173,538
• Average Revenue per Job:  $421.61
• Median Revenue per Job:  $399.57
• Owners Exceeding Average Revenue per Owner:  42%
• Solutions as a % of Revenue:  4.38%
• Average Years Operating:  23.7
• Median Years in Business:  24.0

2nd Quartile

• Number of Owners:  62
• Number of Franchises:  163
• Average Franchises per Owner:  2.6
• Average Revenue per Owner:  $288,025
• Median Revenue per Owner:  $285,552
• Average Revenue per Franchise:  $109,556
• Median Revenue per Franchise:  $118,635
• Average Revenue per Job:  $357.99
• Median Revenue per Job:  $357.78
• Owners Exceeding Average Revenue per Owner:  48%
• Solutions as a % of Revenue:  5.60%
• Average Years Operating:  21.9
• Median Years in Business:  21.4

3rd Quartile

• Number of Owners:  61
• Number of Franchises:  137
• Average Franchises per Owner:  2.2
• Average Revenue per Owner:  $169,612
• Median Revenue per Owner:  $163,224
• Average Revenue per Franchise:  $75,521
• Median Revenue per Franchise:  $83,408
• Average Revenue per Job:  $335.81
• Median Revenue per Job:  $345.98
• Owners Exceeding Average Revenue per Owner:  39%
• Solutions as a % of Revenue:  6.63%
• Average Years Operating:  18.1
• Median Years in Business:  18.1

4th Quartile

• Number of Owners:  61
• Number of Franchises:  114
• Average Franchises per Owner:  1.9
• Average Revenue per Owner:  $102,782
• Median Revenue per Owner:  $105,775
• Average Revenue per Franchise:  $54,997
• Median Revenue per Franchise:  $59,922
• Average Revenue per Job:  $345.30
• Median Revenue per Job:  $343.50
• Owners Exceeding Average Revenue per Owner:  56%
• Solutions as a % of Revenue:  7.76%
• Average Years Operating:  16.0
• Median Years in Business:  16.3

Bottom 10%

• Number of Owners:  25
• Number of Franchises:  43
• Average Franchises per Owner:  1.7
• Average Revenue per Owner:  $85,438
• Median Revenue per Owner:  $86,602
• Average Revenue per Franchise:  $49,673
• Median Revenue per Franchise:  $46,387
• Average Revenue per Job:  $359.46
• Median Revenue per Job:  $343.50
• Owners Exceeding Average Revenue per Owner:  56%
• Solutions as a % of Revenue:  8.34%
• Average Years Operating:  16.4
• Median Years in Business:  16.3

Total

• Number of Owners:  246
• Number of Franchises:  706
• Average Franchises per Owner:  2.9
• Average Revenue per Owner:  $325,842
• Median Revenue per Owner:  $216,261
• Average Revenue per Franchise:  $113,537
• Median Revenue per Franchise:  $100,034
• Average Revenue per Job:  $386.85
• Median Revenue per Job:  $361.30
• Owners Exceeding Average Revenue per Owner:  33%
• Solutions as a % of Revenue:  5.20%
• Average Years Operating:  20.0
• Median Years in Business:  19.5

B. 2023 Franchise Data, Grouped by Number of Franchises Owned

Number of Franchises Owned:  1

• Number of Owners:  61
• Number of Franchises:  61
• Average Franchises per Owner:  1.0
• Average Revenue per Owner:  $204,975
• Median Revenue per Owner:  $159,984
• Average Revenue per Franchise:  $204,975
• Median Revenue per Franchise:  $159,984
• Average Revenue per Job:  $363.15
• Median Revenue per Job:  $337.64
• Owners Exceeding Average Revenue per Owner:  34%
• Solutions as a % of Revenue:  5.70%
• Average Years Operating:  21.5
• Median Years in Business:  20.1

Number of Franchises Owned:  2

• Number of Owners:  84
• Number of Franchises:  168
• Average Franchises per Owner:  2.0
• Average Revenue per Owner:  $236,474
• Median Revenue per Owner:  $167,874
• Average Revenue per Franchise:  $118,237
• Median Revenue per Franchise:  $83,937
• Average Revenue per Job:  $362.60
• Median Revenue per Job:  $353.95
• Owners Exceeding Average Revenue per Owner:  31%
• Solutions as a % of Revenue:  5.07%
• Average Years Operating:  19.4
• Median Years in Business:  19.0

Number of Franchises Owned:  3 or More

• Number of Owners:  101
• Number of Franchises:  477
• Average Franchises per Owner:  4.7
• Average Revenue per Owner:  $473,167
• Median Revenue per Owner:  $361,695
• Average Revenue per Franchise:  $100,188
• Median Revenue per Franchise:  $81,357
• Average Revenue per Job:  $405.03
• Median Revenue per Job:  $380.82
• Owners Exceeding Average Revenue per Owner:  37%
• Solutions as a % of Revenue:  5.13%
• Average Years Operating:  19.5
• Median Years in Business:  19.4

Total

• Number of Owners:  246
• Number of Franchises:  706
• Average Franchises per Owner:  2.9
• Average Revenue per Owner:  $325,842
• Median Revenue per Owner:  $216,261
• Average Revenue per Franchise:  $113,537
• Median Revenue per Franchise:  $100,034
• Average Revenue per Job:  $386.85
• Median Revenue per Job:  $361.30
• Owners Exceeding Average Revenue per Owner:  33%
• Solutions as a % of Revenue:  5.20%
• Average Years Operating:  20.0
• Median Years in Business:  19.5

• A number of factors impact a franchise owner’s revenue, such as the operational capability of the franchise owner, the price that the franchise owner decides to charge, the competition in the market, and the franchise owner’s ability to sell ancillary products and higher-margin services. The price you charge and your ability to sell may differ from the Responding Franchise Owners.

• The figures in the tables above reflect the actual results obtained from the Customer Management Software of the Responding Franchise Owners. The figures have not been audited by Chem-Dry or independently verified. No certified public accountant has audited these figures or expressed his or her opinion concerning their contents or form.

• “Number of Owners” reflects the number of individual franchise owners in each measured category out of the total 246 Responding Franchise Owners.

• “Number of Franchises” reflects the number of individual franchise businesses in each measured category out of the total 706 Reporting Franchises. Chem-Dry considers each franchise agreement to be one “franchise” for purposes of counting the number of Responding Franchises.

• “Average Revenue per Job” reflects the average revenue per carpet cleaning job as reported by the Responding Franchise Owner.

• “Median Revenue per Job” reflects the median revenue per carpet cleaning job as reported by the Responding Franchise Owner.

• “Average Annual Revenue per Owner” reflects the average of the total revenue that the Responding Franchise Owners reported.

• “Median Annual Revenue per Owner” reflects the median of the total revenue that the Responding Franchise Owners reported.

• “Average Annual Revenue per Franchise” reflects the total revenue that the Responding Franchise Owners reported divided by the total number of Responding Franchises.

• “Median Annual Revenue per Franchise” reflects the median of the total revenue that the Responding Franchise Owners reported.

• “Solutions as a Percent of Revenue” is the average cost of all cleaning solutions bought from the franchisor as a percent of reported revenue by the Responding Franchise Owners for each of their Responding Franchises. This is a variable cost.

• Chem-Dry has no information about the labor cost, supplies, automotive costs, and other costs that vary with the number of jobs performed, and the distance traveled by technicians performing the jobs.

• “Average Years Operating” reflects the average length of time in years that the Responding Franchise Owners have been operating their Chem-Dry business.

• “Median Years Operating” reflects the median length of time in years that the Responding Franchise Owners have been operating their Chem-Dry business.

• “Owners Exceeding Average Annual Revenue Per Owner” reflects the percentage of owners in that group that are exceeding the Average Annual Revenue per Owner of that same group.

• The Responding Franchises have operated for long periods of time, some of them for longer than 18 years. These Responding Franchises report that they have developed a customer base over time that provides a recurring revenue stream. A new franchisee starting a new Chem-Dry business franchise would not start with that base of customers and should expect to realize lower revenue.

• The Chem-Dry brand is well established in many of the markets in which the Responding Franchises operate, where advertising of the brand over the long term enhances brand awareness. If you operate your Chem-Dry business franchise in a market where the Chem-Dry brand is not yet well developed, your franchise may not benefit as much from an established trade identity in the market or from historic and current marketing activities that other Chem-Dry business franchise owners in the same market have historically conducted and will continue to conduct. Franchises in new markets for the Chem-Dry brand may produce lower revenue than revenue reported by Responding Franchise Owners in established markets.

• Other than the cost of cleaning solutions as a percent of revenue, this financial performance representation does not report other variable costs or fixed operating expenses, or other costs or expenses that must be deducted from the revenue figures to obtain net income or profit.

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

Section VI – Chem-Dry Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️