The technology fee of $1,379 monthly is significantly higher than typical for home services franchises. What specific services and systems does this cover, and how is this fee structured or adjusted over time?
#1
Your royalty rate of 3.0% is below the typical 6.0-7.0% range. Are there any volume thresholds or conditions under which the royalty rate could increase?
#2
The franchise agreement requires maintaining a Base Market Share of 4% of Flooring Potential in the territory. How is this calculated, and what are the specific consequences if a franchisee falls below this threshold beyond the $50/day late fees mentioned?
#3
What was the single litigation case filed against the franchisor about, and how was it resolved? Does the franchisor have any pending disputes not yet reflected in public records?
#4
Your reported gross sales (median $4.7M, average $6.1M) are 4-5 times higher than typical for home services franchises. What percentage of franchisees achieve results within this range, and what is the actual range of unit profitability?
#5
Ten franchisees transferred their units in 2024 compared to 4 in each of the prior two years. What drove this increase in transfers, and are there any factors that may be contributing to more owners wanting to exit?
#6
The non-compete clause is 1 year/25 miles, below the typical 2-year standard. Can a franchisee open a competing business immediately after agreement termination outside this 25-mile radius?
#7
Your total potential contract term is 30 years (10 initial plus 2 ten-year renewals). Under what conditions can the franchisor refuse to renew, and is there a renewal fee beyond the stated $2,000?
#8
With a 0.0% termination rate, has the franchisor ever terminated a franchisee agreement, or is termination simply not exercised as a practice? What would trigger franchisor-initiated termination?
#9
You mention personal guarantees and spousal liability for all financial obligations. If a franchisee defaults, what is the typical recovery process, and has the franchisor pursued spouses personally in any cases?
#10
The late fee structure charges $50 per day plus 18% annual interest on overdue payments. Are these fees negotiable, and what is the franchisor's policy on payment plans for franchisees facing cash flow challenges?
#11
How many of the 149 current units are owned by the original franchisees versus transferred or subsequent owners? Does unit performance differ between original and transferred locations?
#12
Two units closed in 2023 and none in 2022 or 2024. What caused those 2023 closures, and were they franchisor-initiated, voluntary closures, or due to external factors?
#13
The Item 19 financial performance disclosure is available. Does it specify results by territory type, unit age, or franchisee experience level? Are the reported figures representative of typical franchisees?
#14
What specific training and ongoing support does the $1,379 monthly technology fee provide, and is this separate from or included in the royalty structure?
#15
The franchise agreement includes 12 termination causes, fewer than the typical 14-21. Which termination causes are excluded compared to industry standards, and what does this mean for franchisee protections?
#16
Has the franchisor ever modified or increased the technology fee, royalty rate, or other ongoing fees for existing franchisees during their term, and under what circumstances could these change?
#17
With exclusive territory protection, how does the franchisor define territory boundaries, and has there been any franchisee dispute over encroachment or territory definition in the past 3 years?
#18