Jani-King Franchise

Sunshine65, Did you manage to speak to any of the people who have recently lost their franchise and would they willing to speak to my solicitor anonomously . if they are then sure that i am genuine i would like to invite them to a personal meeing with the solicitor only if they are convinced. I would like to get a group of us together and fight JaniKing in the courts. Would you yourself be interested in a legal fight with JaniKing.

Hi All,
I have had my franchise for 11 years now as a side business to other ventures that I have been involved with. I bill 15k a month using 4 full time employess with a MINIMAL time investment. I have also owned a Quiznos Franchise in which I lost 125k... we hit all our numbers but the kickback to their suppliers is basically a scam and we could not make it work and had to close our doors. Jani-King offers a very good, low cost way into the self employed business world. The key is to sell your own accounts and keep corporate out of your life as much as possible. If you are a deligent owner, corporate does very very little in the way of getting in your way and interferring with your progress. Your business is between you and your customers, coporate has very little sway as to your success. So one word of advice is to get off your asses and develop your own business. Referrals are the best way to get new business as is going out and actually selling your services to local businesses. If you have an account go to all their neighbors and introduce yourself. Pass out business cards... you are an entrepreuner so make it happen. I hear a lot of blame being heaped upon Jani-King where possibly it is you who don't have the drive to make your franchise work. It is you business, take the bull by the horns and make it work and stop blaming corporate for not giving you plum accounts that will make you rich. Feel free to call me if you have any questions or comments about Jani-King: Jon (773)343-2859.

Blog #04
Hi all

My next blog is about costs

Costs

This should not be construed as advice whatsoever but this is how I would have approached the situation if I wanted to buy a franchise.
I have built in a lot of assumptions, and will not be held liable for the accuracy of the data contained within this blog.
Your are not to let whatever I have written previously or what I write in the future influence your decision whether or not to buy a franchise.

Costs are an important part of a franchise and they can make or break a franchisee when they aren't handled properly.
To explain costs some basic P & L is necessary and should explain a couple of terms.

Revenue/Turnover - this is the amount of business done expressed in monetary terms over a period in this case 1 year.
It is calculated by multiplying the number of contracts (at whatever rate JK promised to build your business per period i.e. 1 month) and multiply by 12.


The next important term is costs.
We have 2 types Fixed Costs and Variable costs
Fixed costs (FC) are costs that do not vary with amount of turnover generated I'll try to give these based on what I remember, the figures are a guide only and you should not rely
on them to determine whether you wish to purchase a franchise or not!!! These figure are not set in stone, some of these figures may have VAT at 17.5%. Caveat Emptor!!!!!
My guestimates are as follows these costs are outgoings for each month
Van repayment = 400
Tracker for personal car = 100
Tracker for van = 100
Loan repayments = 700
Mentor =50
Van insurance = 50
L Liab Insurance =50
Equipment =250
QRM=100
Owner salary = 1500
Vehicle Licence = 20
Fuel = 200
Phone = 30

These costs come to ?3300 give or take a couple of hundred, these figures are a guide only.
They should not influence your decision to buy a franchise, please speak to your lawyer or FA these figures are not to be relied upon.

Variable costs (VC) are costs that vary with amount of turnover generated.
Labour
Advertising
Chemicals
Cleaning Equipment
Uniforms

Gross Profit is calculated by deducting the VC from Revenue.

Here details get sketchy, because Revenue is not set in stone but we have to revert to % to determine the actual profit.

I have heard (for those lawyers out there this is what you call if I am correct, 'hearsay') that profits of between 8 and 25% are possible.

I can not confirm these figures, so I will use a guide figure of 10% profit for calculation purposes.

Please make sure you get a professional to walk you through these figures and determine whether they are achievable.

So that i don't lose money my reckoning (break even) is that i need to earn ?33000 per month and 10% of that gives ?3330

Assuming:
JK are able to consistently build your business at the rate of ?1500 a month
You don't get extra work
You don't lose any contracts

this is what my analysis and table reveals

Month No. of mths sales for mth Sales p/m Actual Sales
Jan-10 1 0 1500 0
Feb-10 2 0 1500 0
Mar-10 3 0 1500 0
Apr-10 4 1 1500 1500
May-10 5 2 1500 3000
Jun-10 6 3 1500 4500
Jul-10 7 4 1500 6000
Aug-10 8 5 1500 7500
Sep-10 9 6 1500 9000
Oct-10 10 7 1500 10500
Nov-10 11 8 1500 12000
Dec-10 12 9 1500 13500
Jan-11 13 10 1500 15000
Feb-11 14 11 1500 16500
Mar-11 15 12 1500 18000
Apr-11 16 13 1500 19500
May-11 17 14 1500 21000
Jun-11 18 15 1500 22500
Jul-11 19 16 1500 24000
Aug-11 20 17 1500 25500
Sep-11 21 18 1500 27000
Oct-11 22 19 1500 28500
Nov-11 23 20 1500 30000
Dec-11 24 21 1500 31500
Jan-12 25 22 1500 33000
Feb-12 26 23 1500 34500
Mar-12 27 24 1500 36000
Apr-12 28 25 1500 37500
May-12 29 26 1500 39000
Jun-12 30 27 1500 40500

Month is the actual timeline and assumption of business growth
No. of Mths - the number of months elapsed so far
Sales for month - the number of ?1500 sales for the month
Sales p/m - Is the actual sales per month of ?1500
Actual sales - The first three months it is assumed you won't get any contracts so contracts start coming from month 4.
Actual sales are the accummulated amounts this is calculated by adding 1500 to each subsequent month starting from month 4.

Using our guide of ?33000 which we require to break- even, it will take - using the assumptions above - ***it will take almost 25 months to break even

I would also like to see on companies house how long (months or years) it took franchisees to have their business built to the ?22500 and beyond

***This brings me to another topic called cash flow, it may not be uncommon to find a franchise to be paid between 30 and 90 days later for each contract
this will easily translate to 1 to 3 months later adding this to 25 will give you a range of 26 to 28 months before you break even. If I were to negotiate with my franchisor
I would insist that a i get paid regardless as soon as the month ends, if this is not possible I would walk because I'm thinking to myself I'm cleaning a contract for free.

Given that we have Fixed costs of about 3300, the amount of capital spent will be multiplied by the number of months, and this should give a range between ?3300 * 26 to ?3300 * 28
which should give us ?85800 to ?92400. This is you expenditure (outgoings) it has not taken any earnings into consideration.

A couple of things here:
This is a guide only and should not influence your decision whether to buy a franchise or not
VAT has not been calculated
and most importantly, income from servicing a contract has not been included.
This also does not include franchisee not getting your customer care forms in on time, each late contract translates to ?25 per contract per month
It also does not include monthly charges for contracts after month 18 or there abouts (No. of mths) you need to check the JK contract as to what this translates
It also does not include the 10% income for each sales JK are unable to fulfil, I'll try to explain this
Say in month 4 JK deliver on actual sales of 1500 and in month 5 deliver nothing the margin payment would be (3000 - 1500) * 10% = 150

Let us now take a broader view if 20 franchisees join at the same time by month 18 assuming all franchisees are still in business it will be required for JK to deliver ?22500 * 20
i.e. Actual sales for month 18 ?22500 by no. of franchisees
which should equate to ?405,000 is this achievable, I don't know.


I would also ask how many franchisees are allowed in my territory, if i'm not the only one, what guarantees are there that actual sales would be achievable.

The owner salary is that enough for me to live on, there is a good chance that I would have to remortgage, if I do can I afford the repayments on that salary, am I the bread-winner, can i afford to
feed my family on that amount?

TO ANSWER QUESTIONS ABOUT JANI KING DONT DO IT START YOUR COMPANY ON YOUR OWN YOU CAN OBTAIN LOW COST INSURANCE AND BY GOOD CONDITION EQUIPMENT ITS A RIP OFF JANI KING , JAN PRO ALL IS NO GOOD THEY HAVE CLASS ACTION LAW SUITS PENDING RIGHT NOW CALIFORNIA AND OTHER STATES .

I know this has been asked before but i realy think the number of franchisees that come and go should be publisized. so if you know and any ex franchisees why not just add there names here, does not have to be your name or company but that of others that have left

During the last 5/6 months, Balvinder Uppal, Ajaz Ahmed, Nicholas Camborne- Paynter and Manu Sareen have all had their franchises suspended. Only 10 months ago Jani King were publicising their success to recruit more new franchisees.
These 4 have lost a lot of money and i know that one of them is really struggling financially. But we should be posting the names of any body who has lost their franchise in the last year.
Does anybody out there know what has happened to their contracts, ie; who is running them. I believe between the 4 of them they must have had at least £ 2.5 million pounds of contracts per year. Now that's hell of a lot of finders fees. Has it gone to any new franchisees or the existing franchisees or have they taken it in-house.

Why only post names of recent departures.
LETS GO BACK FURTHER AND SHOW THE TRUE EXTENT OF THE PROBLEM

With a monthly turnover of 15k this is not a uk franchise, there are franchisees with over 22k pcm turnover that only operate with 1 full timer, there is just not the profit to cover Nat Ins Contributions

Is there anyone out there who knows of any franchisee who has paid JK their fraqnchise fee and plan fee and recieved no work in return. I know of 2 who have written on another consumer site but have been unable to contact them. They are H. Singh and Miss Salma Khan. If you two are aware of this site please make a comment and anybody else who has paid and received nothing in return. It would help if you are in the UK. We all need to get together and start legal action against JK.

A lot of work has gone inhouse but there are new franchisees as well, the problem with this is they are RE SELLING ACCOUNTS THAT HAVE ALREADY BEEN PAID FOR and the new franchisees are in at the deepend, instead of a gradual introduction of account they are taking on accounts and a business from ex franchisees , some with over 6 years experience that has technicaly failed and been unable to meet government liabilities. TO ALL NEW FRANCHISEES GOOOD LUCK YOU ARE GOING TO NEED IT . JUST A NOTE TO ALL FRANCHISEES KEEP ALL DOCUMENTAION, DONT TAKE JK WORD FOR IT, IF THEY PROMISE YOU SOMETHING GET IT IN WRITING

Would you happen to know how much of the work has gone in-house and how much to new franchisees. It would appear this is how Jani King operate, find a fault with existing franchisee's work and suspend them and then resell the contract to new franchisees.

I am really confuse I have been toying with this idea for two years now. I have heard more bad stuff than good. I live in the South Eastern region of the US I will take advice from anyone. HELP PLEASE

why dont we try and find out were they all got jk accounts and take them of them as they r not running well anyone for that?

I would love to that. There is an ex-franchisee who is trying to contact you. would you e-mail me your e-mail or telephone number and i will foward it to him. My e-mail is [email protected]

The payroll of all the ex-franchisees mentioned has gone inhouse. Technically it's not inhouse because a company housed in the Jani-King building called Abasist Omega is taking over the payroll for all franchisees and much of their accounts. I have checked with Companys House and the major shareholder is Intellectual Property Group which is a Jersy company owned by Ian Thomas. He owns 80% of the shares and 20% is owned by a Grainne Omeara who used to be Jani-Kings Financial controller, so it is basically Jani-King but by another name! The man is a control maniac! These people buy a franchise to have their own company but Mr Thomas can't allow that, he has to interfere and after a huge input of cash he still tries to take everything last penny from these people. The ex-franchisees mentioned are still beening used as an example of the potential success to be had, there is a huge advertising board in the boardroom at Jani-King house with their photos and quotes on it. I have heard that most of the contracts are now in-house as they have been divided up into regions with inhouse regional managers.

Sorry, but this is a no brainer isn't it. If you want to throw your money away buy a franchise from Jani-King. If you want a business go elsewhere

Blog #05

When I bought my Jani King franchise Class Action Suits, Arbritation, Fraud and Misrepresentations were the order of the day within the economy. I felt buying a franchise was a safe bet, how wrong I was.

Revisiting my earlier blog about costs, you need to ask yourself what does profit mean. If I were to buy a franchise today I'd ask the question what do they, (JK) mean by profit, do they mean Gross Profit or Net Profit there is a difference between the two. Say you had £10000 pound worth of monthly contracts and you were guaranteed 10% of this on a monthly basis then your Gross Profit would be £1000. However when if comes to calculating Net profit it is a different ball game all together.

You now take your £1k a month (Gross Profit) and start deducting your monthly expenses whatever is left is your profit, if you have anything at all.

So I make sure that when signing a contract I make sure there is no ambiguity in the term profit because i want to know what precisely what the term means, and probably this could be my source of misrepresentation after all.

I will return later to discuss other details.

Regards

IS THERE ANY FRANCHISEE OUT THERE WHO WOULD BE INTERESTED IN TAKING LEGAL ACTION AGAINST JANI KING. AS A GROUP I AM SURE WE CAN DO SOMETHING ABOUT THESE SCAMSTERS.

I can confirm that there are only around a DOZEN Franchisees, all with VERY VERY large turnovers, my worry is that they will now USE these franchisees to reel-in and con a new stream of franchisees.

Facts about Jani King
JK advertise as having over 1200 franchisees,
YES THAT MAY BE TRUE.
BUT ONLY ABOUT 12-15 IN THE UK.
WHERE HAVE THEY ALL GONE AND
HOW MUCH MONEY HAVE THEY LOST ?????????????????
JK is advertised as a LOW COST franchise,
It may be low cost in the USA and other countries but in the UK
a plan Zero cost around £50k ( This is no gaurentee of any work )
a plan 22 costs over £100k
a plan 44 costs over £160k
NOT VERY LOW COST IS IT