Detailed Estimates of Mr. Handyman Franchise Costs Based on Item 7 (Estimated Initial Investment) of Mr. Handyman’s 2019 Franchise Disclosure Document
These estimates are based on a new franchisee buying his/her first franchise.
1. Initial Franchise Fee: $59,900
- The Initial Franchise Fee is for a territory of approximately 40,000 to 60,000 households that meet Mr. Handyman’s demographic criteria for target households. Mr. Handyman may charge more or less when a larger or smaller (respectively) territory is granted.
- The Initial Franchise Fee is not refundable. You must pay the Initial Franchise Fee in full when you sign the Franchise Agreement.
- Mr. Handyman may agree to finance a portion of the Initial Franchise Fee, depending on your credit-worthiness, the collateral that you have available, and Mr. Handyman’s then-current financing policies. Monthly payments depend on the amount financed.
- The Initial Franchise Fee is waived for renewal terms; however, you will need to pay the renewal fee.
- If this is a transfer, the Initial Franchise Fee is waived; however, you will need to pay the transfer fee and the Transfer Initial Package Fee.
2. Initial Package Fee: $11,000
- You must purchase the Initial Package from Mr. Handyman. The items included in the Initial Package may change to reflect the changing needs of the Business in accordance with System procedures.
- There are no refunds of the Initial Package Fee, except for the Convention Allowance and the Training Allowance under the following circumstances:
- If you attend the first Convention that is scheduled to begin within one year of your successful completion of the Initial Training Program, Mr. Handyman will refund to you the Convention Allowance after you attend. The Convention Allowance is meant to offset your registration fee and other costs of attendance. If you do not attend the Convention within the required time period, the Convention Allowance will not be refunded to you.
- If you attend the 2-3 day training at Neighborly Headquarters that is scheduled within the first 12 months of your becoming a franchisee, Mr. Handyman will refund to you the Training Allowance after you attend. The Training Allowance is meant to offset your costs of attending the training. If you do not attend the training at Neighborly Headquarters within the required time period, the Training Allowance will not be refunded to you.
3. Vehicle Expenses – 3 Months: $1,950 to $3,900
- Franchised Businesses must begin operation with a van that meets Mr. Handyman’s System standards and specifications. As your Franchised Business grows, you will need to add additional vans.
- You should consult your personal financial advisor to determine whether you should lease or purchase your initial and subsequent vans.
- The cost of purchasing and outfitting a van typically ranges from $29,730 to $32,000, plus applicable taxes. When leasing, the amount of deposit will vary depending upon supplier pricing strategies, promotions, and willingness to provide startup businesses with more advantageous pricing than they typically offer individuals leasing a single van.
4. Computer Hardware Package: $3,500 to $6,000
- You must use a computer with adequate memory, speed, and storage to run the software Mr. Handyman requires. You must also equip each technician with an iPad.
5. Real Estate and Utility Deposit – 3 Months: $750 to $3,000
- As required by lessor and utility companies.
6. Furniture, Fixtures, and Office Equipment: $0 to $1,500
- Estimated cost for items including desks, chairs, a file cabinet, telephone system, wastebaskets, and other equipment and supplies necessary to begin the operation of the Franchised Business.
7. Tools and Equipment to Equip One Van: $1,000 to $2,000
- List of tools and equipment is included in the Manuals. These may be purchased locally through national suppliers or at a local home improvement store.
8. Permits and Licenses: $100 to $1,000
- As required by local and state regulations.
9. Prepaid Insurance Premiums – 3 Months: $1,800 to $2,800
- Typically, insurance companies require startup businesses to pre-pay a portion of their premiums.
10. Training Expenses – Travel, Food, and Lodging: $3,000 to $4,000
- Out-of-pocket travel expenses vary depending on your proximity to Mr. Handyman’s training center in Ann Arbor, MI, as well as the field training site, the type of transportation you use, and your individual expenses during the initial training period of 5 days.
- For the purposes of this Item, Mr. Handyman has estimated two individuals sharing one hotel room.
11. Additional Funds for 3 Months: $34,500 to $54,000
- This Item estimates your initial startup expenses for the first 3 months of operations, not including those expenses identified separately in the table.
- It includes payroll costs for operation and customer service employees, general vehicle maintenance and gasoline, advertising, Internet and telephone provider fees, some uniforms, and, at the high end of the range, office rental. The estimate of additional funds does not include an owner’s salary or draw.
- These figures are estimates and Mr. Handyman cannot guarantee that you will not have additional expenses starting the business.
12. Total Estimated Initial Investment: $117,500 to $149,100
- Mr. Handyman has relied on the management team’s general experience with franchising in the United States, along with the experience of Mr. Handyman franchisees, to compile these estimates.