Commercial Cleaning Franchise - Profitable, Cash-Flow Positive

Warwick, RI (Kent County)

Seller Financing Available
Enviro-Master Commercial Cleaning
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Asking Price: $338,000

Cash Flow: $170,000

Gross Revenue: $520,000

EBITDA: N/A

FF&E: N/A

Inventory: N/A

Rent: $0.67 /Month

Established: 2016

Commercial Cleaning Franchise - Profitable, Cash-Flow Positive

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Business Description

Commercial Restroom Hygiene Business with recurring contracts in place with local and national clients. There is no direct competition for our service in the local and national marketplace. We currently service many local businesses as well as large multinational corporations. Large customer base with diversified revenue sources and extremely low cancellation rates. This is a very stable and high-growth business with tons of opportunity in the RI/MA market.

This unique health and safety franchise, with over 35 years of history, helps national and local businesses keep their employees and/or customers safe from disease causing germs and bacteria. As the only provider in the space, this business provides these solid business fundamentals:
1. Low initial and ongoing Capital investment
2. Recession Resistant service
3. Minimum Competition (No other National or Franchised Competitor)
4. Cannot be outdated by Technology
5. Residual Income
6. Scalable
7. Large, Identifiable Market

Sale price reflects strong positive cash flow and value in existing operation (stable customer base, stable operations team and functions). This franchise territory has positive cash flow and is profitable. Per the Franchise model, businesses at $500k/revenue should just be breaking even. We are already at 10-15% Profit Margin (this includes owner benefit and financing). As this specific business grows beyond $500k the fixed costs begin to become less material (Salaried employees, rent, utilities, insurance, etc.). Consequently, at $750k - $1MM in revenue our specific business is on target to have an annualized profit margin of 20-25%. At $1MM+ we are on target to achieve 25 - 30% Profit Margin.

Year to date (Jan to Nov 2018): 87% Gross Profit Margin. 11% Profit Margin (with owner benefits), 36% Profit Margin (excluding owner benefits and financing expenses).

Stable operation with strong customer retention and extremely lean business. Great opportunity for the new owner to invest into the long-term growth of this business.

Detailed Information

Real Estate:
Leased
Building SF:
2,836
Lease Expiration:
3/31/2020
Employees:
7
Facilities:
Low overhead business model. Very low inventory on hand and low requirement on FF&E. Current: $1,890/mo - Mixed use office / warehouse space (1.5 years remaining on lease - 2,836 sqft - approx 30% office, 70% warehouse) $4-7k in Inventory (Summer peak, Winter low) $4k for one company vehicle. May need an additional vehicle as operation scales (typically $5-$10k)
Competition:
No direct competition. This is not a standard "janitorial" or "commercial cleaning" company. The services offered are very unique. The closest competitor would be Cintas with their Sanis Service but it does not deliver the same value proposition. We have a very strong market presence with an extremely low cancellation rate (<5% per annum) due to the unique value proposition of our services.
Growth & Expansion:
Extremely large amount of opportunity to grow this business. Tremendous success growing it (~30%) in the first year. Not limited to any industry. Success in servicing restaurants, hotels, fitness clubs, manufacturing, etc. Geography of territory allows for strong growth for the next 7-12 years. Opportunity to employ 2-4 salespeople across the territory.
Financing:
Open to dialogue around seller financing.
Support & Training:
Franchisor provides 2 week onboarding as a part of the purchase for owner and operations manager (if needed). Franchisor has additional training options beyond the 2-week starting point (business coahes and sales trainers at the ready). Current owner can provide training on local market, customers, other nuances as negotiated with buyer.
Reason for Selling:
Relocating family out of state for personal reasons.
Franchise:
This business is an established franchise
Business Website:
http://www.enviro-master.info/franchise
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Business Listed By:
Ivan Rudnitsky

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