Summary
Minimal working capital investment required. Generates recurring cashflows with multiple income streams. Stable growth in revenue (FY25 $9.74m) and EBITDA (FY25 $1.46m) in recent years.
Revenue
$9,741,435 pa
Rent
$25,500 pa
Expenses
$8,282,376 pa
Net Profit
$1,459,059 pa
Location Details
The head office location is in Ringwood East. The premises includes an office with plenty of space for staff, and room to store cleaning materials. The fit-out is in good condition and perfectly suits the current needs of the business.
Potential
- Capitalise on pipeline of prospective franchisees seeking to buy a franchise.
- Subdivide management of the Melbourne region into two separately managed geographical areas, so that managers have a greater focus on driving growth in the number of franchisees in their region.
- The business has been successful providing cleaning services to NDIS participants and aged care approved providers. A new owner could capitalise by growing these offerings via investing in a concerted marketing campaign to partner with other approved providers.
Hours
Monday - Friday
9am-5pm
Lease
- $25,800 plus GST p.a.
- 3% annual increase
- Expires 01/09/27
- Landlord has indicated they are open to renewal
Employees
- 8 employees, including the vendor and his wife
- Employees are paid market-based salaries, including vendors
- All staff are loyal
- Low staff turnover
- Annual remuneration review
- No bonus/commission payments to staff
Reason for Sale
The vendor is approaching retirement age, and has family overseas that they wish to spend more time with.
About the Business
The business possesses the Regional Master Franchisee rights to manage a network of 116 franchisees located in Melbourne, Victoria. A contractual agreement exists with the Australian Master Franchisee which provides the business with the right to operate the brand in the Melbourne region.
The vendor is seeking to exit the business via sale of 100% of the equity.
The franchisees provide home cleaning services including home, carpet, end-of-lease, steam, window, and upholstery cleaning. Agreements with franchisees are documented in signed agreements which provide for a 10-year term, with a right for franchisees to renew for successive 10-year terms. The business does not have a reliance on individual franchisee relationships, only 10 of the 116 signed franchisees are made up of individuals who own multiple franchisees. An opportunity exists for a new owner to convert more single franchisees into multiple site operators. The agreements with franchisees allows for franchisees to operate within a specified geographical area.
The business generates income through multiple revenue streams, which are all of a recurring nature, assisting a new owner with managing a stable cashflow. Income sources include income received from franchisees (a lump sum earned upon commencement, plus recurring royalties), and income received directly from the NDIS, Aged Care Provider Businesses, and the TAC. Management has successfully built relationships with these major industry bodies which results in additional guaranteed home cleaning jobs for franchisees. The business is a registered provider of home cleaning services for participants approved under the NDIS, and a preferred provider for TAC and Workcover in Melbourne.
There has been significant organic interest from prospective franchisees with very little marketing spend.
The business is required to source and provide a guaranteed amount of home cleaning work to new franchisees. The business has always been able to secure new home cleaning work, with a strong brand name, superb online ratings and customer satisfaction.
The business has several highly experienced staff, who the vendor has trained to be able to maintain operations in their absence. Employees are very strong at converting prospects into new franchisees.
The Australian Master Franchisee has a CRM software, which both the business and franchisees use to help them manage the business. The business’ other existing software packages are fit for purpose.
History
The vendor has managed the business for approximately 15 years. They have been responsible for achieving strong growth in the number of home cleaning franchisees in Melbourne. The home cleaning brand is renowned across Australia and in New Zealand, with other Regional Masters operating in territories outside Victoria.
The compound annual growth rate in revenues between FY21–FY25 was 31%, and profits grew by 24%. Growth has been driven by consistently growing the number of franchisees. Very little investment working capital has been required.
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