FRANCHISE OF THE YEAR
by
Peter Crouch
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PUBLISHED BY CHARGAN AT SMASHWORDS
This book available in print from
www.chargan.com
Franchise of the Year
Copyright © 2011 Peter Crouch
ISBN: 978-1-4661-1232-2
All rights reserved. Without limiting the rights under copyright reserved above, no part of this publication may be reproduced, stored in or introduced into a retrieval system, or transmitted, in any form, or by any means (electronic, mechanical, photocopying, recording, or otherwise) without the prior written permission of both the copyright owner and the above publisher of this book.
Peter Crouch has asserted his right under the Copyright Act 1968 to be identified as the author of this work.
Content advisory. This book contains references that may be considered suitable for adults only: sexual references, adult language.
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How Carpet and Upholstery cleaning works
I would like to dedicate the book to my lovely wife Marinka, and all my customers over the last five years, without them, this book would have been impossible to write.
I tell Marinka how lucky she is too having me. She tells me how lucky I am that she puts up with me every day! No one else would.
This book is also dedicated to all those people that are thinking of buying a franchise.
To anyone thinking of buying a franchise:
The key word is “beware”. Franchisors are out to make money, please read the small print, as it’s too late once you have signed the contract.
There are many Franchisors that are not greedy or self opinionated.
The best franchisors would be run by a board of Directors that are accountable for their actions, with a breakdown on all spending. Remember you are paying for their company, without franchisees, there would be no Franchise.
If any of you are thinking that they are buying a job, or going to semi-retire, think again, your hard-earned money over the years won’t last long, when you still have to pay fees every week, even when you are not turning over enough money.
What happens when you are ill, take holidays, have a family crisis? They still require their fees.
I love my job, more so for the people I have met along the way.
Would I do it again? Good question.
The answer would have to be yes, but as my own business.
Map: Perth, Western Australia suburbs referred to in this book.
Note: some suburb names and client names have been changed to respect the privacy of clients.
One of the funniest and completely innocent experiences was when a lady booked in a job to clean her carpets on a Monday, but didn’t want me to start till 12.30 pm as she was a paramedic and had been working all weekend on the graveyard shift.
She told me she wanted to get the house clean for when her partner returned, as he had been working away for 3 weeks and she couldn’t wait until he got home later that afternoon.
Hence she wanted a lie in so that she wasn’t tired when he got home.
I got around there about 12.30. While I was cleaning the carpets, she was busy cleaning the rest of the house, getting it ready so they could relax that evening when he returned.
I brought in my Eftpos machine as usual, as most pay by card nowadays, and wrote out the invoice. She paid by cash, had a quick chat and said goodbye.
I drove to my 2 o’clock job and started to unload my van when I realised that I had left my Eftpos machine at the last house on her table. I rang her up and asked if that was the case. She said yes, so I told her I would call around later on the way home from work to pick it up. All good.
I finished my last job about 4.30 pm and drove back to her house. As I pulled in to her drive a car pulled up alongside me. I didn’t take much notice, got out and walked around the side gate, been there before so didn’t bother to knock.
The guy who was in the car was walking a few yards behind me. I still didn’t take much notice. As I was walking up the drive, her dog starting barking, letting her know that someone was there.
I was just about to knock on the door, when it flew open with the lady wearing just a pair of knickers!
She was shouting out ‘surprise’, in a spread eagle position, when with one look at me she screamed and ran in behind the door!
I turned around to look at the guy behind me and said “I’ve only come back for my Eftpos machine honestly”!
He just grinned and said “I think she got more of a surprise then you! I just texted her to say I will be home in 5 minutes.”
“Oh shit” I said “she thought I was you!”
“That would be it. I’d better get your machine for you.” So he popped in and returned still smiling. “Thanks” I said and left, probably for the last time.
That was just one of many funny but true stories, that I would come home and tell my wife Marinka and daughter Carly.
They both, along with some of my friends, would say I should write a book about the running of a carpet cleaning franchise.
My answer would always be: “who would believe me?”
This is how it all began.
I bought the franchise five years ago. I’m a Plumber by trade or more to the point a sheet roofing plumber, or even more to the point a sheet lead worker.
I came to Oz to be with my now wife Marinka to start a new life, and being a plumber here was the last thing I wanted to do for a number of reasons, most of them best left unsaid.
I was in the middle of a real estate course, when an old friend of mine (now ex-friend) also from England had just acquired a franchise of a carpet cleaning business. He asked me if I would be interested in joining him as a partner in buying another two franchises, making three in total.
My answer to him was, “who the fuck has their carpets cleaned?”
His reply was “you would be surprised.”
So I worked for him for two weeks to try it out. We fell out, as you guessed, over money, so what happened was that I parted company with him and obtained my own franchise of carpet cleaning.
As you know, we own a franchise of a well known carpet cleaning company. There over 140 franchises throughout Australia. They are one of the biggest if not the largest carpet cleaners in Australia. There are bigger ones elsewhere in the world, though that is not very important to our story.
In 2010 we became Franchise Of The Year!
However the franchisor had not wanted to give me the title. We don’t always see eye to eye. That would be the best description of our relationship. I think he’s a greedy, self centered dictator, who tries to treat us all like employees, and believes we are incapable of thinking for ourselves.
But we are ok in working our own franchises and paying high fees, plus 10% of any income above the base turnover of $3500 per week, plus we pay over $800 a week on advertising, so really they do very little for our fees. We don’t even get a say in where our advertising money goes. We might, but it falls on deaf ears.
The advantage for buying a franchise is that the base is already in place.
They have structure and a marketing plan, which may be not a good one, plus a guaranteed customer base, with existing customers, a proven formula, and you would think, a backup and help service for the franchisees. Not all true.
How do you get started?
You have to buy the area from the previous owner. He gives the franchisor 10% of the sale, why I don’t know, but we will have to when we sell. They encourage you to build up your area at your cost, so you can pay them an extra 10% of all income per month, and hopefully you haven’t gone bankrupt beforehand when you sell!
The idea is to have two or more vans in one area, as your franchise fees and advertising are the same, but your over and above income is obviously charged at 10%.
The problem is getting good technicians for the van.
Buying another van, and set of equipment, etc even a second hand van of any use, would set you back at least $20,000. To fully equip it with an extraction machine, polisher, vacuum, bonnet pads, spray bottles, rakes, horse hair brushes (for lounge suites), chemicals etc, would cost at least $6000 second hand, and at least $15,000 new.
So to put the van on the road, the minimum it would cost you would be $26,000. Then on top of that you have to pay wages, mobile phone, fuel, maintenance cost, repair or renewal costs, plus loss of income, while they are being repaired.
That is without the worry of getting enough work every day of the year. I say everyday because they charge franchise fees and advertising for 52 weeks. No holidays, you might be thinking, not if you buy one of these franchises.
If the company was owned by us, I am sure I wouldn’t be invoicing Christmas week, or the two weeks I take for a holiday.
When we first started, all franchises took their own calls and bookings. Head office would take the odd franchisees calls if they couldn’t cope or when franchisees when on holiday, for a couple of weeks. They also used to redirect the odd stray call.
About eighteen months ago, in their infinite wisdom, they decided to start up a call centre in the Philippines, using they say American university educated girls, paying them peanuts I don’t doubt.
They wanted everyone to join this call centre, making it sound so good, but only a handful of franchisees, probably the ones head office in Newcastle NSW were doing anyway, took up their offer.
We suspected that it was started as a control move. They would have access to everybody’s booking system and know how many jobs were booked in and for how much, controlling not only your day but your complete business.
They said your job to phone call ratio would increase by 20%.
As nobody took the up on their kind offer, they then said, not that it was in any of our contracts, that anybody owing them more than $15,000 for more than 60 days or anyone with less that 40% conversion rate i.e. jobs to calls, would have to go on to the call centre, at just under $200 per week, this is on top of our advertising, franchise fees, 13---- phone number fees, chemicals, and day to day running costs.
Great earner for them: low set up costs, low rent and cheap labour in the Philippines, some tables and desks, a few computers. Not much more than that. I am sure they think we are all stupid or too small individually, to stand up to them.
Just think if 100 out of the 145 franchises were to pay them for their kind service then that’s $20,000 per week times 52, because we would still have to pay Christmas week and when we are sick, or on holiday, then they earn $1,040,000 per year from the poxy business.
If we were all to use it like they wanted us to, it would be $1,508,000.
That is over a million dollars profit each year in somebody’s pocket. Not ours.
Also it would look good if they wanted to sell the Franchise, total control, with a side show bringing in over a million dollars profit.
He might be a greedy dictator, but he is not stupid.
We had to use the call centre for a few months as we got in to debt with them for a while, when Marinka was ill.
Our conversion rate went down from 70% to 50%. Our customers said they would stop using us, if they had to call the call centre, saying that they had to wait up to 5 minutes to talk to someone, then sometimes would be left on hold, which could only be due to short staff or lack of phones.
Once answered, the customers found them hard to understand, with a Philippine American ascent. They all said that they were friendly, to the point of sickly, kept asking them to repeat their details, could not pronounce their names or suburbs correctly, and tried to up-sell on the phone all the time.
Also they could not answer some questions when asked. Sometimes my regular customers would be on the phone for up to twenty minutes just to book in three rooms, which should take at tops five minutes.
Everybody took my personal mobile number so they could call me direct which ruined the whole idea of the call centre, and could cause a black market trade.
They just never thought the whole thing through properly. If you’re in Australia you want to speak to an Australian. It doesn’t matter how many of us, which is most of us, tell them, they don’t want to change it.
They had no choice but to give me Franchise Of The Year. Our turnover and conversion rate of jobs to phone calls received were over 80% whereas their average is only 40%, including their call centre in Asia, which I disagree with and won’t use for a number of reasons, best left unsaid in the book.
I never really wanted to be Franchise Of The Year, and it’s not that I am cleverer than any other franchisee. I just happen to have a very affluent franchise zone with some of the richest areas in Perth. Also the Franchisor told me two years ago that it would be impossible to have 3 vans running in one area. I went out to prove him wrong, and he had to back down which I know would have killed him. During the conference when I was awarded the Franchise Of The Year, my nickname was Foy.
Over the last 5 years we have also added commercial work, like real-estate agents, hotels, and small businesses, which I would say are our bread and butter. The work that is generated by our Franchisors head office only provides work in the private sector, and for most of us not enough to keep a substantial franchise in full swing.
In one particular hotel, we do quite a lot of call out work for drink spills on carpets and upholstery, sometimes, ink, crayon, alcohol, and baby formula. Also we have had to clean four mattresses due to bed wetting.
During the March storms they had two rooms and the conference room flooded. We are probably there on average once a week.
What I didn’t realise was that when you book into a hotel and they ask you for credit card details, they will charge you with any damage if anything needs professional cleaning. I always thought that they took your credit card details, just in case you used the bar fridge or ate in their restaurant.
While I was cleaning one of the floors the head, a clean nice middle aged woman, came to ask me to look at a lounge suite with ink on in another room. “Some of the people are like pigs” I said, “I am sure they wouldn’t do this in their own house.” “You would hope not” she said. “I bet you see some sights.”
I said, “I have been doing this for years and nothing surprises me now.”
The worst are the middle aged men. When the young girls come to clean their rooms and knock on the doors, a lot of the time they don’t answer, so the girls knock again and enter. Just when they walk in the men walk out naked, saying “oh sorry I didn’t hear you, I was having a shower.” It happens too often to be a mistake, at least three to four times a week.
I wonder if they just get their kicks from it, or are hoping the girls will come on to them? A bit of both I would imagine.
We have had this franchise for 5 years, mostly good, but hard work. When we started both Marinka and I used to work it, Marinka taking the phone calls and bookings, and doing the book work, myself on the road, doing the cleaning, and at week-ends both on the van together.
It took a long time to build up to the clientele. Now we have just over 5,000 customers.
When we first took over we were only turning over $1,500 to $2,000 per week, which was less than our outgoings, as our fees to the franchisor are more than $1,500 per week, plus 10% for any work more than $3,500 per week, plus chemicals, fuel, phones, computers, stationary, insurances, accountant, the list goes on.
We give quotes over the phone, depending what the caller tells us (not all tell the truth), and then adjust the price when on site. That is where the trouble begins. This is where we find out what percentage they are, good, ok, or arsehole.
After 2 years, we were doing quite well, and decided to buy another franchise, which came up quite cheap or so it seemed at the time, south of the river. We would have a technician work it for us. We soon discovered why it was so cheap, the last franchisee had run it right down, and it had a bad reputation. We went through several technicians, most useless or greedy or lazy. I found I was trying to work both franchisees, which was killing me, paying double franchisee fees, for little or no return each month.
Marinka then became very ill with cancer of the Douglas pouch, which we found out is inside a women’s bits, so named after the man that found it. Strange, I’ve been looking all my life and never found it. Marinka had to have radiotherapy for about a year, and became extremely ill at times, with her immune system very low. I also found things extremely hard to cope with, and got quite depressed at times, which would sometimes last for months.
That was probably our lowest point. We got into financial problems of course and couldn’t see a way out at one point.
Then Marinka got the all clear.
We decided to sell the second franchise, build up the other one to two vans, while only paying one lot of franchisee fees. Marinka went back to what she knew best - Pharmacy.
I took over the phone calls and bookings, tried to get other people doing the bookings for me but that didn’t work out, found I was best at it myself, and it was a lot easier to control. We got a second van on the road and employed Jason who was great, well most of the time, and he could sell on.
We had a second wage coming in, which was great, and worked our way out of our problems, well almost.
It will take a long time to get back to where we were, probably a few more years, but we have both been strong together, and found it had made us closer if that’s possible. Most couples would probably not have survived it.
Two years on we won Franchise Of The Year. We are both quite proud of that achievement.
They try to hold a conference every eighteen months, using a different venue each time. Our first one was in the Hunter Valley. It rained every day of the three days we were there. We all got lost on the way and didn’t arrive till three in the morning. The first meeting was at 8.30 am, not well organised at all. Our chalets were at the bottom of the hill and the conference at the top. The roads turned into a mud bath, we were thinking this company couldn’t organise a piss up in a brewery, but we all made the best of it.
The second conference was a top hotel in Brisbane, much better, good hotel, great rooms, swimming pool, no rain. It was at that conference that we met the new managing director. We got on extremely well. He came across as straight, honest, friendly, and with a sense of humour. We found we had a lot in common. He is an Italian Indian, educated in London England, and followed the English soccer premiership. Over the next 18 months we kept in touch, and he helped us a lot when we were having our problems.
At the next conference which was on the Sunshine Coast, another good venue, Marinka and I went out drinking a couple of times. At gala/ presentation night, the last night, we had all been drinking. There was a group of us franchisees all together, with the managing director.
Now you need to understand that at conferences, everybody moans to everybody, and a lot of the franchisees thought he was an arrogant prick, and not very helpful. I always stuck up for him because that was not how I found him.
Well back to Gala Night. We were all standing there, after the presentations. We came 3rd, I might add, believing that’s as far as we would ever get. We were all drinking in the smokers room, probably about thirty of us.
Then I turned around to the M.D. and said “most of us believe you are an arrogant arse, but I will say it to your face, and not behind your back”. He just stared at me and smiled and said “fuck off you’re more arrogant than me”. We then started arguing about who was the most arrogant, when we stopped and looked around.
All the other Franchisees were gone, and the only person left was Marinka with her head in her hands not believing what I had said.
“Sorry” she said to the M.D., “Peter says what he thinks, but at least he tells you to your face.” “Don’t worry” he said “let’s get another drink, and drink to honest, straight forward talking people.” With that we shook on it and agreed.
If it was not for him, eighteen months later I would not have won Franchise Of The Year.
Not that we just clean carpets, oh no more than that my friends, we also clean upholstery, drapes, leather, and tile and grout, listen to old ladies telling us about their departed husbands, their children, look at old photos of their past, and we also play with kids, look at their drawings from school, see their new toys, pat dogs, move furniture, pick up clothes including underwear and a whole lot more as you will find out while reading this story of the life of a carpet cleaner!
All the franchisees attend special training, and update courses to make sure we are abreast of anything new in the industry, but the job is as only as good as the technician doing the job, and like any job there are some crap ones out there. Not many but a few I know, that I would not recommend.
I’ve have a few jobs, owned my own Plumbing and Roofing company, taught for two years at a technical college, had a fish and chip shop and owned a pub/ restaurant for two years. I thought the pub was an eye opener to the general public, I could tell some stories there, but another time. I’ve always said after the pub, that I had seen and heard it all and that nothing could shock me anymore, and maybe that’s true, but I am still surprised by people every day.
Quite often, while we are cleaning people’s houses, they ask us about tile and grout clean. What I always do is say would you like me to clean a small section, so you can see how will it will come up, but you must understand that this is done by hand the big clean comes up so much better as it’s done with machines.
I then give them a brochure, and ask them which tile to test. They always say in the kitchen, and I always say that tile there, pointing to the middle tile, looks the worst. Ok they say.
I then clean the middle tile by hand, using an alkaline chemical, tile and grout brush, and clean damp, cotton nappy.
When I am finished, they can’t believe the difference, and go “well I will have to get it done now”. Their husbands if there will say “you wanker, you deliberately did the middle tile, so we have to clean the rest.” “I asked what tile” I always say, but you’re right, I did.
Good on you, you say, a good way to generate work. Nine times out of ten they book the job in straightaway.
I’ve had a few accidents at work, also a couple in the van. Due to the vans being quite wide, with quite a few drives being narrow and overgrown, we quite often clip overgrown trees, when reversing out, and on one occasion, I turned too sharply and caught a carport post, which slowly bent lowering its roof until I realised what I had done.
I then had to go forward and reverse past it and then drive into it to straighten it up, did quite a good job, never quite looked the same, but never had a complaint though. Got away with that one!
When I first started our shirts, which were light blue with dark blue collar and cuffs, use to be the same as the local high school, in one of our suburbs we work in.
One day Jason and myself were standing in the queue at MacDonald’s one lunch time. Now you must realise we are both six foot, and weight about 100 kilos, when about thirty school boys walked in, we both felt like we where the big kids of the class. The girl behind the counter asked us if our mum knew if we were having MacDonald’s for lunch!
Two years ago we decided to purchase a new van. Our second van was past its sell by date, and to expand we realised it was best to purchase a new van, because the government was giving a 50% tax rebate benefit on any new commercial purchases if bought before the end of the tax year. The first port of call was head office. We imagined that they would know where the best place to purchase one was, where to get the sign writing done, and hopefully the cheapest way to finance it.