Franchise: 1-800-GOT-JUNK?
Franchising Since: 1999
Headquarters: Vancouver, B.C., Canada
Number of Units: 160
About the Franchise
1-800-GOT-JUNK? is the world’s largest junk removal franchise with 200+ Franchise Partners throughout the United States, Canada and Australia. 1-800-Got-Junk? takes items like furniture, appliances, construction debris and yard refuse from homes to dumps or recycling facilities.
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Franchisees provide clients with uniformed drivers who provide trash pickup during a scheduled two-hour window. 1-800-GOT-JUNK? franchisees are expected to have a full time commitment to offer and a background in leadership and sales/marketing. Franchises are also expected to hit a minimum revenue of $100,000 in its first year. Franchises who do not meet this goal are given a full refund.
Financial Assistance
The franchisor generally does not offer financing. However, the franchisor may, in its sole discretion, allow the franchisee to pay the initial franchise fee with respect to some of the subterritories in equal monthly installments for a period not to exceed one year upon terms acceptable to the franchisor.
Term of Agreement and Renewal
The length of the franchise term is five years. If conditions are met, the franchisee can renew or extend the franchise term for three additional five-year terms.
Breakdown of Costs
The following information is compiled from the Franchise Disclosure Document of 1-800-GOT-JUNK? (2014). The FDD will provide you with in-depth information regarding the costs and expenses you can plan to incur when developing a 1-800-GOT-JUNK franchise. For a Franchisee with 4 Subterritories (which is the typical-sized new territory 1-800-Got-Junk? offers).
Initial Franchise Fee: $30,000
This figure includes the Subterritory Initial Fee of $12,000 for the first Subterritory, plus $6,000 for each of the three additional Subterritories.
Initial Marketing Fee: $12,000
The Initial Marketing Fee will be used by 1-800-Got-Junk? in its discretion to market and promote the Franchised Business prior to and/or during the first 6 months of operation.
Computer Hardware and Software: $1,500 to $3,000
You must obtain computer, telephone, and other related equipment that meet 1-800-Got-Junk’s specifications. These amounts represent the estimated cost to purchase this equipment.
Misc. Opening Costs: $5,000 to $10,000
This estimates your initial miscellaneous start-up expenses, including your initial truck-based marketing kit, yellow page and/or Universal Business Listing ads, uniforms, truck equipment, deposits, business licenses, and legal expenses. Your expenses may vary substantially, upward or downward, depending upon the nature of your existing operations, whether you currently own computers and telephone equipment, and whether you currently have an office.
Equipment (Vehicle Lease with dump box); Lease/purchase deposit: $0 to $10,000
Total truck cost is estimated at $47,500 per gasoline-powered truck and $59,000 per diesel-powered truck. The above figure assumes that the truck is leased or financed and does not include applicable taxes or shipping for the truck box. You must obtain a truck equipped with a dump box from 1-800-Got-Junk’s supplier. Truck cost is estimated and will vary depending upon market prices. You are encouraged to check with your local auto dealership.
Real Estate/Rent: $1,200
You must secure administrative office space for your franchise at the commencement of operations. You must maintain sufficient space to operate computer and telephone equipment and maintain records. 1-800-Got-Junk? estimates that you will need a minimum of 300 to 400 square feet. The above estimate is based upon rental payments of $400 per month, with payment of first and last month’s rent and a damage deposit equal to one month’s rent at the beginning of the lease.
Local Marketing (3 months): $3,600
You are required to expend 6% of Gross Revenue on local advertising, but in any event no less than $3,600 per quarter on local advertising during your first year of operations.
Insurance: $800
his is an estimate for insurance on your trucks and equipment, public liability, workers’ compensation, and property insurance for your franchise. Note that workers’ compensation insurance varies widely throughout the United States and may differ substantially from 1-800-Got-Junk’s estimate of $800 per month.
Additional Funds (6 months): $56,200 to $70,000
This estimates your initial operating expenses, including working capital and marketing fees, during the initial start-up months.
Training Expenses $1,500 to $3,000
The training expenses are incurred by you for your travel, accommodations, and meals while training at 1-800-Got-Junk’s training facility. Per person expected costs are based upon a 4-day estimated stay, with accommodations from $100 to $200 per night; one meal per day (the franchisor provides breakfast and lunch during training); air transportation at $500 to $1,000 per person; and local transportation at $10 to $25 per day.
ESTIMATED TOTAL: $111,800 to $143,600
These figures are estimates in setting up a 1-800-GOT-JUNK? franchise and operating it for three months. It is possible to exceed costs in any of the areas above.
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