Barriers to entry in the janitorial business aren't exactly sky high, Paul Dorsey acknowledges.
"It takes a bucket and a mop," he says.
But after eight years in the business, Dorsey, 37, knows clients are much more demanding than that. So after working for large players in the industry, he has spent the past two years building his Jantize Custodial Services through a franchise system.
At Jantize, would-be cleaners pay franchise fees ranging from $3,500 to $35,000. In return, they are guaranteed a certain level of business from accounts Dorsey signs up.
Those who invest $3,500 are guaranteed $6,000 in annual business, while those putting up $15,000 get contracts of at least $54,000, he says. If Dorsey doesn't deliver within 120 days, franchisees can get their money back.
Jantize has 19 franchisees, which do a combined $50,000 worth of business per month, and Dorsey expects that volume to double by this time next year. Target customers are small to midsized businesses seeking reliable cleaning services.
Jantize's fees range from 10% to 14%, including royalties, management fees and insurance. After labor and equipment expenses, that still leaves an operating margin for the franchisee of more than 40%, Dorsey says. In other words, a franchisee should be able to pocket $400 for every $1,000 worth of services.
Jantize faces plenty of competition. National rivals such as Jani-King International Inc. and JanPro International Inc. operate locally, as do an untold number of startups.
"When something like a Pillowtex closes, we start competing with another 50 people," Dorsey says.
But he says would-be janitors quickly learn that commercial cleaning requires dedication, specialized equipment and constant sales efforts. Having new equipment gives large commercial cleaners an advantage over mom-and-pop businesses, he says.
But most clients also want a personal touch, Dorsey says. "The person cleaning a building is an owner, so he has a vested interest in making sure you are happy."
Before awarding franchises, Jantize screens applicants for past bankruptcies.
Franchisees rely on Dorsey to handle sales and billing, freeing them to concentrate on cleaning.
Mike Brown, a maintenance supervisor with Charlotte-Mecklenburg Schools, signed up with Jantize to supplement his income. "I called all of the local (franchise companies), but Paul was a little more professional," he says.
Other Jantize franchisees include personnel at Microsoft Corp. and Wachovia Corp., says Dorsey, a South Mecklenburg High School graduate who worked in restaurants before switching to janitorial services. "These guys are getting to be my intimate partners, rather than just being franchisees to me," he says.
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