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How Much Does Pinch A Penny Franchise REALLY Cost?
Do you think now’s the time to own a Pinch A Penny franchise but hesitant to proceed without knowing all the cost breakdown? Don’t worry. This article is just right for you. Let’s list down all the Pinch A Penny franchise costs to give us a realistic overview and more!
Pinch A Penny Franchise: The Details
Pinch A Penny, originating from Clearwater, Florida, started the business back in 1974 and ventured to franchise in 1978. It’s known as one of the largest franchised retail pool supply and service companies with 260 estimated units. The following are a few important things you should know before knowing the Pinch A Penny franchise cost.
Franchisee Authorization:
- Sell at retail the full variety of swimming pool supplies, products and equipment, patio furniture, and related items.
- Offer, sell and provide pool and spa janitorial cleaning, maintenance, and repair services at private residential customer locations.
Course:
Pinch A Penny, the franchisor, provides a training course for the franchisees, majority owner, operating partner, or other personnel which the franchisor has approved of. The overall training is located in Clearwater, Florida, or any other preferred location by the franchisee. It will take a minimum of 120 hours, conducted for four weeks. However, take note that this is before the commencement of the franchisee’s operations.
The franchisee is also expected to take part in all other activities required for the store’s opening. Furthermore, the Pinch A Penny team will provide at least five days of training to the franchisees at their store during the first 60 days of opening. The franchisor has the right to increase the minimum hours of training as they see fit. Also, Pinch A Penny will provide additional training for such periods and such locations appointed by the franchisor.
Territory Details:
First, the franchisor grants store franchisees a specific location that it approves. Next, the franchisor grants franchisees an exclusive right to operate a Pinch A Penny franchise along with its system within a three miles radius around that approved store location. Bear in mind that franchisees may only provide services within that area of proximity and around that reserved pool services territory.
It’s good to be aware that there will be instances where franchisees may face competition from other franchisees. Other than that, a franchisee may also face competition from outlets the franchisor owns or from other competitive brands the franchisor controls.
What’s Expected from the Franchisee:
- Always be faithful, honest, and diligent in performing obligations under the Franchise Agreement.
- Continuously exert best efforts in the promotion and enhancement of franchised business.
- Not engaged in any other business in compliance with the Franchise Agreement and any other standards and specifications.
- Must offer to sell all products and perform all services that the franchisor requires from time to time.
- May not offer the unauthorized sale of any products or perform any services.
Term of Agreement and Renewal:
The initial franchise term for Pinch A Penny is five years. After the 5-year term, if franchisees are in good standing, the franchise can be renewed or extended for three additional five-year terms. After a franchisee’s first 10 years of the franchise, to obtain a successor renewal term, the business’s gross volume for the most recent calendar year before expiration should not be among the lower 5% of store competitors existing for three years or longer.
Financial Support:
Franchisees may qualify for financing support up to 80% of the franchisor’s initial investment for a new Pinch A Penny store. However, the percentage of finance may vary per franchisee based on several factors such as:
- Credit history
- Financial resources
- Financing needs
Also, the franchisor will assess other financial resources that may be available to the franchisee. It’s important to note that the franchisor does not guarantee a franchisee’s note, lease, or obligation.
Did you know?
Before we proceed with all the numbers, here are fun facts about Pinch A Penny.
- “Pinch A Penny” was coined by Fred, the founder, as a means of having a name that connoted a discount.
- It started as a small warehouse outlet starting from pool chemicals.
- It is considered the largest franchised retail pool supply and service company.
- The Pinch A Penny franchise has not closed a single store in more than 25 years in business!
Pinch A Penny Franchise Cost Breakdown
Finally, we’re about to break down how much a Pinch A Penny franchise cost is. Let’s move on to the FULL cost list.
| Name of Fee | Low | High |
|---|---|---|
| Initial Franchise Fee | $50,000 | $50,000 |
| Initial Lease and Security Deposit Payments for Store | $10,000 | $12,000 |
| Furniture and Fixtures for Store | $80,000 | $100,000 |
| Vehicle Graphics (signage) | $1,200 | $2,500 |
| Vehicle (monthly purchase payment) | $425 | $700 |
| Bleach Tank and Containment Equipment ‒ Store | $12,000 | $40,000 |
| Opening Inventory and Supplies ‒ Store | $70,000 | $90,000 |
| Equipment and Start-Up Supplies ‒ Pool Services | $1,500 | $3,500 |
| Training Expenses | $2,000 | $5,000 |
| Commercial Auto & Business Insurance | $3,250 | $6,000 |
| Legal | $1,500 | $3,500 |
| Printing & Signage | $5,500 | $17,000 |
| Fees, Licenses, Permits, Local Law Government & Other Prepaid Expenses | $1,000 | $3,000 |
| Computer Systems | $12,000 | $16,000 |
| Additional Funds – 3 months | $15,000 | $20,000 |
| ESTIMATED TOTAL | $29,375 | $411,200 |
Other Costs
| Type of Fee | Amount |
|---|---|
| Royalty | 6% of weekly gross volume of business. |
| Advertising Fee | 4% of weekly gross volume of business. |
| Corporate Service Plan | $1,200 to $2,500 annually. |
| Transfer Fee | $8,000 |
| Renewal of Franchise Agreement | Up to 25% of then-current initial franchise fee, but not less than $12,500. |
| Audit | Cost of inspection or audit. |
| Service Charge | The lesser of the compounded daily equivalent of 18% or highest rate of interest allowed by law. |
| Management Fee | $1,000/week plus personnel costs plus 20% of gross volume of business. |
| Costs and Attorneys’ Fees | Will vary under circumstances. |
| Indemnification | Will vary under circumstances. |
| Encroachment Fee | Varies; up to 20% of revenue earned from violating the Cross Territory Policy. |
In addition, first-time franchisees should also be aware of other potential hidden fees such as:
- Buying real estate
- Repairs, construction or renovations
Take note that the mentioned costs above can vary depending on your location. Now, we fully learned how much a Pinch A Penny franchise cost. For more information on other franchising opportunities, explore Franchise How.