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MAID BRIGADE - FDD UFOC ITEM 7 Detail

ITEM 7

 

YOUR ESTIMATED INITIAL INVESTMENT

 

Estimated Initial Investment for SELECT MARKET Franchises

 

Expenditure

Estimated Amount

Method of Payment

When Due

Refundable

To Whom Payment Is Made

Initial Franchise Fee(No,?l)

$9,500

Lump Sum

On Signing .

Franchise

Agreement

No

Us

Computer Equipment (Nrte3)

$1,000

Lump Sum

As Incurred

No

Third Parties

Equipment, Fixtures, Other Fixed Assets Including Leasehold Improvements, Signs, Pre-Opening ExpenseslNole4)

$1,000-$1,500

As Incurred

As Incurred

No

Third Parties

Opening Inventory(No,e 51

$2,500

Lump Sum

On Signing

Franchise

Agreement

No

Us

Automobile <No,e7>

$500 per Month

Monthly

Prior to Use

No

Third Parties

Insurance and Bond(No,c8)

$1,000-$2,000

Monthly

As Incurred

No

Third Parties

Training Expenses<No,e9)

$2,000

Lump Sum

Prior to Opening

No

Third Parties

Opening Advertising and

Telephone Listing (I**C ,0>

$9,000 for the first

three (3) months

Lump Sum

As Incurred

No

Third

Parties

Additional Funds-3 Months

(Note 11)

$9,000 for the first three (3) months

As Incurred

As Incurred

No

Third Parties

TOTAL ESTIMATED INITIAL INVESTMENT FOR SELECT MARKET FRANCHISE (No,e,2)

$35,500-37,000

 

 

 

 


INITIAL INVESTMENT

 

Estimated Initial Investment for Standard and Major market Franchises

 

Expenditure

Estimated Amount or Estimated Low to High Range

Method of

Payment

When Due

Refundable

To Whom Payment Is Made

Initial Franchise Fee0*"*"

S29.500-S58.500, for territories with minimums of 25,000 and 60,000 qualified households respectively, plus $1 for each additional qualified household

Lump Sum

On Signing

Franchise

Agreement

No

Us

Real Estate/Office(No,e2t

$500-$l,000

Monthly

Prior to Opening

No

Third Parties

Computer Equipment(Nole 3)

$1,000-52,000

Lump Sum

As Incurred

No

Third Parties

Equipment, Fixtures, Other Fixed Assets Including Leasehold Improvements, Signs, Pre-Opening Expenses(Note4)

$l,5O0-$3,000

As Incurred

As Incurred

No

Third Parties

Opening InventoryfNQlci)

55,000-Standard $7,500 Major

Lump Sum

On Signing

Franchise

Agreement

No

Us

Security Deposits and Other Prepaid Expenses(NMt6)

$1,000-52,000

As Incurred

As Incurred

No

Third Parties

Automobile(Notc7)

$500 per Month

Monthly

Prior to Use

No

Third Parties

Insurance and Bond <No,eS>

$1,000-52,000

Monthly

As Incurred

No

Third

Parties

Miscellaneous Opening Expenses

$1,000-52,000

Lump Sum

Prior to Opening

No

Third Parties

Training Expenses(ND,e9)

$2,000

Lump Sum

Prior to Opening

No

Third Parties

Opening Advertising and Telephone Listing(*wc 10>

$12,000 for Standard Market, $16,000 for Major Market. Represents first three (3) months

Lump Sum

As Incurred

No

Third Parties

Additional Funds-3 Months

(Now 11)

$32,000-$36,000

As Incurred

As Incurred

No

Third Parties

TOTAL ESTIMATED INITIAL INVESTMENT FOR CHOICE MARKET FRANCHISEiNow l2J

$87,000-97,000 for Standard Markets

$122,500- 132,500 for Major Markets

 

 

 

 

Explanatory Notes:

1.                  See Item 5 of this Disclosure Document.

2.                  You must establish and maintain an office outside of your home if you purchase a Standard or Major Market. If you purchase a Select Market Franchise, you may operate out of your home. If you operate a Standard or Major Market Franchise, we must approve the size, rent and location of your office. It is our intention to help you properly control rent expense. The cost for your office will vary considerably depending on the size and location of the office, from a negligible amount for a small office in an office park to a substantial amount for a high-visibility office in an office complex, which rarely occurs. The size of your office will vary depending on the type of franchise you purchase:

 

Type of Franchise

Square Footage Recommended

Franchise Territory with at least 25, 000 Qualified Households

400 - 700 ft.2

Franchise Territory with at least 60,000 Qualified Households

700 - 900 ft.3

3.                  This estimate includes a connection charge to an Internet provider. We will give you a list of computer equipment you will need in order to operate our proprietary software program whether MicroMaid, which is the current program, or MaidSmart, by Total Management Software Solution software, which will be instituted in 2007. You do not purchase the computer equipment from us. The cost of the equipment you purchase will vary depending on the amount of equipment you buy, the supplier you choose, general economic conditions, your geographic location, and your persistence in obtaining the best prices available. You must have Internet access and email. You may be required to purchase a Personal Digital Assistant that meets our specifications.

4.                  Your costs will vary depending on the size, configuration, and condition of the furniture, supplies, signs, and fixtures you select and the location of your office.

5.                  This represents your Initial Package. See Items 5 and 8 of this Disclosure Document.

6.                  Your landlord will generally require you to pay the first and last months* rent as a deposit. Utility companies and rental agencies will probably require you to pay deposits and prepaid expenses, including prepaid expenses relating to furniture, fixtures, or equipment you may lease.

7.                  You must use clean, relativity new automobiles for business transportation. The estimate does not include ongoing gas and maintenance expenses, which you must normally pay on a monthly basis. If you purchase the automobile(s) you use, your initial investment will be significantly greater than the table shows. We require that your vehicles display our proprietary car "wrap," that we specify from time to time. Our approved vendors may include the cost of the wrap in the lease or purchase price of the vehicle.

8.                   The figures shown in the tables cover premiums for the insurance you must maintain and the costs you are likely to incur in obtaining a blanket fidelity bond in the amount of $10,000 for each employee.

9.                   For all Markets we do not charge you for our training programs for new franchisees, which consists of Pre-Opening Training and Corporate training. Standard and Major Markets receive additional training On-Site Training at our training center and the franchisee''s local office at no cost. Select Markets may obtain the On-Site training for an additional fee. See Item 11 of this Disclosure Document. You are responsible for the travel, food, and lodging expenses you incur when you attend our training program and the salary and benefit costs of your attendees. Costs vary due to distances from your location to our headquarters and the quality of the food and lodging you choose.

10.               Your advertising cost is directly related to the amount and type (television, radio, brochures, newspaper advertisements, direct mail, and other types) of advertising you conduct. The amount you spend is within your discretion, but Select Markets must spend $3,000 for the first three (3) months. With respect to the Standard and Major Markets, you spend a minimum of $48,000 per year for the Standard Market and $64,000 for the Major Market, and to the extent that your territory contains more than the minimum number of Qualified Households, your obligation will increase on a pro rata basis. The numbers in the chart above reflect the minimum obligations for the first six months of operation.

11.               Working capital covers the initial expenses you are likely to incur while you establish the Franchise, and those you are likely to incur between the time you begin providing services and the time you begin having a steady cash flow from payments by customers. These expenses include costs related to performing background checks, hiring employees, initial employee wages, and purchasing other goods and services. Your expenditures will depend on factors like your business skills and experience, general and local economic conditions, competition, the prevailing wage rate, the amount of services you provide during the initial period, how well your business is performing, and the number of hours you are willing to invest in your Franchise. These expenses do not include any draw or salary for the owners of the Franchise, but they do include additional office support services you may need.

12.               In compiling this chart, we relied on our experience in the operation of home cleaning services and information our franchisees gave us. The amounts shown are estimates only and may vary for many reasons. You should review these estimates carefully with a business advisor before you make any decision to purchase a Franchise. We do not offer direct or indirect financing to you for any of these expenses. Many of the expenses listed are not within our control and are determined more by general and local economic conditions than our actions. A bank or other lending institution may finance all or a part of your investment on terms we cannot estimate. The availability and terms of financing will depend on factors like the availability of financing, your creditworthiness, collateral you may have, lending policies of your financial institution, and local economic conditions.

 





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