National franchise the rope a dope plan

[www.cmpropertymaint.com]

After 26 years in the building trades we put together a business plan and have a small following of clients.where things got crazy for us was our advertising.we where noticed by several franchises and now 2 of our largest accounts are in a national franchise agreement with us being the subs.don't take me wrong we desperately needed there revenue but through the hole process we are preforming our largest building for less than .09 per square foot Yes we went in blind glad just to have the work.Just hoping to warn others of what can happen when your not in control of the bidding process. to start the franchise is only concerned in selling the contract promising that the corporate office has your best interest ...not.secondly in most states you are entering into an open bid process witch will include a walk through and a set time to meet with the managing officers of the building
lastly if bidding on a Square foot conveyance please make sure you personally do the math walk out the building to see if the client them selves have been honest in their needs assessment and the actual size of the building don't go in blind it will ruin your credibility and your profits that we all know truly are not that spectacular to begin with we started out biding and sining for .17 per sq ft and because we went in blind thinking we were servicing 6,720 sq ft now realizing its a 12,000 plus sq ft building with a 1 year contract please please be cautious of third party agreements stick to your biding styles and you will do OK.

Now the question to all is you can turn this around with the client with your customer service and how they perceive the way you are meting the needs of their facility but how long would you settle for a contract thats only giving you a positive reference with no profit. need some feed back please.

[J4K Cleaning]

We have been contacted numerous times from the big contract cleaners for every thing from janitorial to floor work. The vast majority are a joke and want you to do the work for a fraction of what you would normally make on the job.
There are exceptions to the rule, we do have one account for a contractor that does pay us well and is easy to work with. That is why they are the only one we have.
The rest I never even bother to call back once they give me the numbers for the job.
My advice would be to get out of the account and chalk it up to experience. Your client more then likely is not concerned about your service as they now its all done at the corporate level and out of their hands.

[ssabin3]

Am i reading it right ,that you are saying that the national franchise opportunities are not worth it.

[bkjan]

Hi guys, I have been reading this board for quite a while now as I have wanted to start my own business for a couple of years. Regarding the National Franchise, I have been an operations manager for a large commercial cleaning franchisor for 4+ years now. It is no big secret how we are perceived by the smaller companies. There have certainly been times that I have shook my head at some of the practices that go on. It was kind of a fluke that I started working there and had never even been particularly interested in the industry. Now to be quite honest I would not buy a franchise. I also probably wouldn't recommend it to many of the people on this board. On the other hand I have seen it work very well for many people who have dreams of owning their own cleaning business but none of the skills required to do it. As far as the bidding process is concerned. I think that there are good competent salespeople who really understand that you can't just input numbers and spit out a price, and there are also knuckleheads who will do anything for comission including giving away the farm. I have a pretty thorough understanding of the way the franchise companys work and I am also not a brainwashed yes man, so if anyone has any questions regarding this please feel free to ask.
Tom

[logan5127]

Tom, I agree with alot of what you are saying. I have often shook my head at practices/procedures that go on as well , in francises and in individually owned cleaning companies. there is much that could be said positively and negatively about both.
I do think that most decisions on francise is mainly a cost/money/start up issue. For others it may be a control issue. What ever reasons we have for going francise or not there will always be both sides of the fence. Both sides will have problems. Both sides will have some great high quality work and both sides will have some awful work performed. Both sides will at one time or another do jobs for less than they should. Both sides will have people with good ethical practices and both will have some with very bad ethics. Both sides will have times of high stress . Both will have times of Pride and Both could be a good choice or perhaps in the end a bad choice. Thats just my opinions and thoughts. With that said , I myself have never been in the francise side. I have sub worked with several francise owners over the years. I have checked into many francises over the years. I have had francises contact me over the years. At one time I would have went that way but never was willing to come up with the money required at the time. I am at a comfort zone now just being a self owned cleaning service.
That is the benefit of each of us. To make our own decisions good or bad.

[Grizzly]

The largest problem with doing sub work is you cannot make a profit on the margin they agree to. Consider, they are bidding on national accounts in the millions of square feet. Now, in most cases the sub contractor supplies the people, chemicals, and often the paper supplies. The , I will call them the master contractor charges a much smaller amount per sq. ft because a narrow margin on millions of sq. ft.
still earn them a respectable profit. However, for the subcontractor doing maybe 12000.00 sq.ft. the same price per sq.f t. does not allow for in some cases a minimum profit margin. You end up subsidizing the account with other business. Not good. We have two accounts that we sub for a master contractor. Luckily, we had these accounts prior to them going national and so had bid them with our profit margin in. However, that was 5 years ago and now we are just breaking even. I am keeping these accounts for the sole reason we have long term employees doing them with no other work in the area at present. As soon as we get other contracts in that area, we will submit our "resignation" with notice. For most national accounts , they are'nt interested in the fact your costs go up, they want to see prices go down in the 3rd and 4th year of contracts through efficiencies that are developed. These "efficiencies" usually end up on the back of the sub contractor.

Bill

[bkjan]

Dan you make a great point. The fees that we charge do at times seem staggering. Also like any other franchise you may go to a Subway and get great service, great food, and a clean environment. You could probably go a mile down the road and find one that has terrible service, bad food, and is filthy. That is one of the many problems with franchises.
Another issue is training. The Franchisors typically have a high turnover rate for employees. Now while I have been doing this a while and I truly did make an effort to educate myself in the industry, it is very often that the training of a new "business owner" is done by someone who may have never learned how to do it themselves. On the other hand I have been accused by many of the independant guys of being responsible for ruining the profit margin in the industry. I have honestly found that not to be true. I would say at least 60% of our customers are paying us as much or more than the previous company that they were using. Of course I can only speak about my area but here it is typically the struggling mom and pop companies that are undercutting everyone to be able to put groceries on the table. Oh and by the way I wasn't sure I would be recieved very well on this board as I know some see me as the bad guy, so I really appreciate making me feel welcome.

Tom

[logan5127]

You are welcome Tom. It is great to have you here and look forward to more of your post. As I have said before, We all have much knowledge to gain. Once we become completely closed mind then we will limit our potential. We should all be opened minded and learn as much as possible . To do this we need to see both sides of the fence. We need to appreciate variety and all it has to offer us. That does not mean we have to change our ways or even agree with what someone says but it does give us a better view and understanding of anything we do in life. I have agreed with many post on here and I have disagreed with many. I am one man. I have opinions, thoughts, good and bad experiences, and sometimes I am wrong in those and sometimes I am not. Thats my opinion (lol). I recently said in a post that we should be strive to be fair and balanced. To do this we need every member here. To do this we all need to take part in the board and try to be kind, understanding and grow together.

Tom, I do look forward to many more of your post and not only those but the countless others and I look forward to learning much more . I believe in being our best to do our best. To do that we must always strive to learn more and be humble enough to know that we do not know everything.

To every meber here, Remember that it is OK if another member disagrees with you. That is a great learning tool for all of us.. Debates are great. You may be able to explain what you have said and you may not. But in the end we all learn from different points of view. So please do not be angry if someone disagrees with you , but instead share your thoughts and your reasons. thanks to all, Dan

[evetsclean]

Well said Dan! There's nothing I love more than a spirited debate, where everyone comes out friends in the end. That's how it should be.

And even though I don't really have anything to contribute on the current topic here, it's nice to see a new member like Tom who is here to contribute, not just harvest information then never post again. Welcome Tom!

[www.cmpropertymaint.com]

I gues maybe my wording of this post was harsh with the intent to strike up a colective thought.three months have pased sence the original post.we now sub for two franchises both of them are very helpfull in daly operations and we are looking forward to a lasting comitment to them and thier clients.my frustration was from walking in blind as i stated a costly mistake on my part.we now stand our ground on bidding to ensure a profit.

[logan5127]

May 7, 2008 4:47:31 GMT -5 www.cmpropertymaint.com said:

I guess maybe my wording of this post was harsh with the intent to strike up a collective thought.three months have passed seance the original post.we now sub for two franchises both of them are very helpful in daily operations and we are looking forward to a lasting commitment to them and their clients.my frustration was from walking in blind as i stated a costly mistake on my part.we now stand our ground on bidding to ensure a profit.

I don't think your words were harsh at all. Instead i think they were words of wisdom from experience. A lot of services go into a new venture with blinders on. First of all if we do go in with blinders on then it is usually our fault from not researching the job site and being over excited about getting a contract. The thing for those that do this, is to be able to speak up once we See what we didn't see before. If speaking up does not help then we sometimes have to see ourselves to the exit door.
It appears that perhaps you to have saw the light and made some adjustments.
It is bad experiences that we sometimes learn the most from. If we share them then just maybe we might help someone else to see more clearly. Thank you for your post that sparked up some more knowledge for all of us to share.