ServiceMaster One of Few to Offer Start-Up Financing to Would-Be Franchisees
As banks restrict lending, start-up and ongoing business support can be a lifeline for people seeking small business ownership
MEMPHIS, Tenn., Feb. 17 // PRNewswire // -- Timing, opportunity and economic feasibility -- all three factors are key to giving people the extra push they need to get started on the road to business ownership. For Julie and Barry Ellis of Fairhaven, Vt., the decision to start a franchise business was all about timing. In 2006, Barry had worked for a franchise owner for 15 years, and Julie had run a home-based daycare business for 20 years. When Barry's employer passed away unexpectedly, and with their children grown, the Ellises decided the time was right to start their own business. But they needed financing to make their dream a reality.
After looking into various franchise businesses, they settled on ServiceMaster Clean, a business that fit their two main criteria. They wanted a franchise that would be less prone to the fluctuations of economic cycles and that would provide a solid return on their investment if they chose to sell the business in the future.
"Since Barry had worked for a previous franchise owner, we knew the potential of the business. No matter how bad the economy is, pipes still break and furnaces still malfunction," Julie Ellis said. "We'd been in contact with our (now) regional manager at ServiceMaster, and he was instrumental in helping us get started."
ServiceMaster Clean, which provides commercial and residential cleaning and disaster restoration services, is one of four franchise businesses available through Memphis-based ServiceMaster. ServiceMaster is also one of a relatively few franchise companies that offers in-house financing through ServiceMaster Acceptance Company (SMAC) to applicants who meet the company's franchisee profile. Other ServiceMaster franchise businesses with financing available include Furniture Medic, on-site furniture repair; Merry Maids, maid service; and AmeriSpec, home inspections.
ServiceMaster's vice president of market expansion, David Messenger, says that for entrepreneurs looking for a business with low start-up costs, a ServiceMaster franchise could be the perfect fit, especially with the in-house financing.
"Since most of our franchises are mobile, on-site businesses, they usually don't require a large investment in equipment, and very often they can be operated out of a franchisee's home," Messenger said. "The in-house financing, which will finance up to 80 percent of the initial franchise fee and start-up equipment, is a great opportunity for credit-qualified franchisees."
After receiving financing for part of their initial investment in the business through ServiceMaster Acceptance Company, the Ellises were awarded a franchise in July 2007.
"We looked into other types of financing too, but felt we were being taken for a ride by some of the other companies," Ellis said. "ServiceMaster offers different options for financing, including one that worked for us."
Barry Ellis said that ServiceMaster's in-house financing not only benefits those who want to finance their initial investment, but also current franchisees too.
"As franchise owners grow their business, capital and line of credit loans are available through SMAC. This financial assistance could provide additional vehicles, equipment, or real estate. The financial assistance is available through the life of their franchise," Messenger said.
Prior to starting a ServiceMaster Clean franchise in 2006, Shane Austin owned an auto inspection shop in Philadelphia. He wanted to look into another type of business because state laws are constantly changing, and the stability of his former business was unpredictable.
Like the Ellises, Austin was drawn to a ServiceMaster Clean janitorial franchise on a variety of levels, including the fact that it didn't require years of training or education, and that it was a low-cost venture to get started in. He decided on SMAC to help finance his initial investment -- he paid half of the franchise fee himself and financed the other half. Austin now has a team of 14 employees, and was impressed by the company's eagerness to invest in him.
"What most attracted me was that even in rough economic times as long as the business operates, some type of janitorial service is required," said Austin. "More importantly, the company actually taught you the business. I really feel like I'm in a true partnership with ServiceMaster Clean."
For DeAnna and David Benson of Charlotte, N.C., the decision to buy a ServiceMaster franchise was not so much about the low start-up costs as it was about being backed by a national company with prominent brand recognition.
For more than 20 years, David was self-employed in a custom cabinetry and millwork business, with 30 employees in Connecticut. The Bensons had known about Furniture Medic for several years, but the timing to purchase had never been right. They decided to open a Furniture Medic franchise after an employee embezzled money from their previous business.
According to David, "It was a good fit because of my past experience, and one of the things that sold me was being part of the ServiceMaster brand. Because of what happened to us, my trust and faith in anything was pretty low, but ServiceMaster is a reputable company and we've been very pleased."
The Bensons financed the franchise fee to get started through SMAC, and noted the process was very painless. David does the actual repair work and DeAnna handles the business aspects of the franchise. Their customer base is fairly broad, with a mix of commercial and residential customers. They have been in business since February of last year.
ServiceMaster has been in the franchise business for more than 55 years. ServiceMaster Clean, Furniture Medic, Merry Maids, and AmeriSpec combined add approximately 200 new franchises each year, and ServiceMaster has provided in-house financing through the ServiceMaster Acceptance Company for more than 20 years.
ServiceMaster currently serves residential and commercial customers through a network of more than 5,500 company-owned locations and franchised licenses. The company's brands include TruGreen, TruGreen LandCare, Terminix, American Home Shield, ServiceMaster Clean, Merry Maids, Furniture Medic, and AmeriSpec. The core services of the company include lawn care and landscape maintenance, termite and pest control, home warranties, cleaning and disaster restoration, house cleaning, furniture repair and home inspection.