Chem-Dry franchise opportunity: Are you familiar with it?
If so, please share your experience, opinions or insights with a comment below.
According to data released by the Small Business Administration (SBA), Chem-Dry franchise owners who qualified for SBA-backed franchise loans have a high loan failure rate of 41%.
That earns Chem-Dry a spot in UnhappyFranchisee.com’s list of WORST FRANCHISES IN AMERICA (by SBA loan defaults)
The apparent drop in Chem-Dry franchises in recent years and the high loan default rates are franchise due diligence red flags.
| Chem-Dry Franchise | |
| Chem-Dry U.S. franchises in 2008: | 2531 |
| Chem-Dry U.S. franchises in 2012: | 2150 |
| Growth in franchise units 2008 – 2012 (#) | -381 |
| Growth in franchise units 2008 – 2012 (%): | -15% |
| SBA loans granted since 2001: | 42 |
| SBA loan failure rate: | 41% |
| Sources: Entrepreneur (growth), Coleman report (SBA) |
The inability to repay an SBA-backed loan (or any franchise loan, for that matter) indicates a serious situation for the franchisee.
It’s likely that Chem-Dry franchise owners who received SBA loans may have collateralized their franchise loan with their homes or other personal assets, and many were unable to repay those franchise loans… despite the serious incentive to do so.
Are you familiar with the Chem-Dry franchise opportunity?
What do you think accounts for the SBA loan failure rate of Chem-Dry franchise owners?
What steps should Chem-Dry be taking to stop further franchise failures?
Has Chem-Dry taken serious action to address the problems that led to these loan failures?
Please share a comment (anonymous is fine) or Contact UnhappyFranchisee.com.
If you are a Chem-Dry franchise representative or employee, please feel free to leave a comment or email us at UnhappyFranchisee[at]gmail.com.
ARE YOU FAMILIAR WITH THE CHEM-DRY FRANCHISE OPPORTUNITY?
ARE YOU A CURRENT OR FORMER CHEM-DRY FRANCHISE OWNER?
PLEASE SHARE A COMMENT BELOW.
Corporate responses or rebuttals welcome:
Contact UnhappyFranchisee.com
Chem-Dry, Chem-Dry franchise, Chem-Dry franchise complaints, Chem-Dry complaints, Chem-Dry franchise failures, carpet cleaning franchise, home-based franchise, cleaning franchise, mobile franchise, franchise failure rates, SBA franchise loans, worst franchises
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View Comments
Chem-Dry has boiler room selling system that focuses on emotion, irrelevant statistics and hype.
Chem-Dry, like a lot of franchises that provide home services, saw some tough years during the recession. The FDD information you mention is misleading; while the total number of franchises has declined, this has more to do with owners letting go of extra franchises during the recession so they could run more profitable businesses than it does with people going out of business. The total number of franchisees in the US has stayed pretty flat at around 1,100 or so.
As for SBA loans, I don't think there are many franchises in the system that use SBA loans. The company provides very good internal financing at much better than SBA loans and they have very few defaults.
All-in-all, it is a well-run system with happy owners who provide a good service. With such a large system, there are always people coming on or exiting out; it has expanded more than anyone in its sector and same store sales are up from 2011. As for sales processes, ChemDry has one of the better franchise development teams in the industry and does a good job of recruiting people who are a good fit and trying to talk people who are not out of the decision to open.
OK. Talk about some BS. As a former Chemdry owner I can tell you the drop in Franchises is the fact they (Harris Research) cleaned house. They were sold, once again, (since we have owned a Chemdry the franchisor has been sold about 5 times0. They current owners came in, fired half the company, relocated to Nashville, and took away franchise for "technical" issues. Many franchises that were "stolen" away were smaller who did not have the resources to fight in court.
Should have known, before we purchase a Chemdry went to SCORE and were advised by a retired CEO NOT to get into Chemdry because it was a product driven franchise, meaning all you do is buy buy buy from the company, constantly forched to purchase new equipment and un-needed chemicals.
Chem-Dry franchise sales is literally new and used car sales.
They are selling a loaded up van with equipment on a lease to purchase program.
The salesmen will say just like a car salesman would...we'll get you into this low mileage econovan, I'll just go talk to my sales manager to get you approved.
You were a little light to qualify bu we made it happen.
Who the hell do these people think they are. Both of my neighbors used this company. I had to listen to what sounded like a jack hammer outside of my house for hours. What gives them the right to be so invasive to the public. This DOESN'T end here. I'm reporting this to the BBB. Figures there used car salesman. They certainly do not care about anyone else.
I have owned 2 franchises for 10 years now and have spent a small fortune investing in Chemdry's best equipment The CTS Carbonated Truck Mount System.
I am here to tell you nothing comes close to the results you get when your carpets are cleaned with these truck mounts. I can take black traffic lanes out of white berber carpets and the carpets will dry in 1 -2 hours. its all about using their proprietary carbonated solution and the Power head which spins at 200 rpm to rub the spots out while extracting the dirty solution back into the trucks waste tank. We clean at 110 PSI, Steam Cleaners who just hook your hose to their truck clean at around 500 PSI they push everything down into the padding without any agitation, then when the carpets finally dry ( 6 - 24 hours later), the spots simply wick back up and reappear.
So I keep all my customers.
That is the good part. This system is very expensive to operate between maintaining the equipment and buying the carbonated solution from ChemDry, then on top of that you pay a flat monthly franchise fee and you have to buy a myriad of other solutions from Chemdry too, but a lot of them are amazingly effective.
To be successful , you must be a worker who is willing to jump on a truck your self because getting help that has the qualities needed is damn tuff: work ethic, brain, communications skills and hard physical work.
So you need to pay them a percentage of the daily sales to keep them interested.
The current problem is Bain capital has purchased ChemDry from Home Depot and fired a lot of good people who had been there for decades. Now Bain Capital is trying to milk the franchisees for more money by instead of forwarding customers who go to the chemdry.com website to their local franchise via putting your zip code in a box then the local franchisee's phone number would be displayed. Are now instead hiding the zip code finder and putting their 800 number "call to schedule an appointment" then you get a corporate sales person who relays the customer to the local franchise via computer software and expects to get a fee of 50.00 from the franchisee for each customer they talk to.
So they are double dipping on the franchise fees. many of us are trying to fight this as in my opinion we pay our monthly franchise fee already and these customers are just looking for their local Chemdry franchise because someone told them we are the best in the business, not because of anything Chemdry corporate has done such as advertising on our behalf, (they don't) but because of the hard work of the franchisee and the technology that we already pay for every month via franchise fees and expensive solution purchases.
I was a co owner of chem dry franchise a decade ago. They always preached about chem dry being the largest carpet cleaner in the world. However most of homes we went into no one ever heard of them. We had virtually no accounts through them and no national commercials educating the public.
They lied and stole my entire life savings
Dont get mad get even stil cleaning carpet with a Cleanco 47 far outworks anything chem-dry makes still working 7 days a week love to clean carpets love my customers. On that note so glad not to be a chem-dry frachise. Save your money start your own carpet cleaning business and be happy.
My brother and I spent a combined 30 years of our lives doing everything they told us to do, running up costs while they kept making more and more demands out of us. The whole time they just built their profitability into the constantly changing franchise agreements.
It was like renting a bad job from Hitler with no benefits. They over saturated franchise areas, created price wars among franchisees, were responsible for franchisee failures, and even competed against franchisees by selling repossessed franchises on the cheap to keep their revenue stream from being interrupted, making it very difficult for a franchisee to resale their franchise for a decent price. Return on investment = an F grade.
The owner sold us out on two occasions to privately held venture capitalists while keeping a good share for himself. They are basically unregulated so they just kept the ripoff going.
Now Baine Capital owns them. The original founder and his dad are part of the Mormon church (the dad being a Bishop), now the company who was founded by another big wig in the Mormon, Mitt Romney owns it. The founders showed little empathy for the franchisee and seemed to focus only on the money, why would this situation be any different. Profiting from others is what venture capitalists do.
We have been out of it for nearly 10 years now since I've gone independent. I cut my costs dramatically, have received Angie's List Super Service Award 7 Times and from this large metropolitan area which at one time had 50 Chem Dry Franchises, and this year is the first year a Chem Dry has made the list.
Save your money, your health, your back, your dignity, your family's future and just say no to Chem Dry!
They do not care about you! I knew a gentleman who had his franchise for about 10 years, when he was diagnosed with a heart condition, he tried to sell it. He could not sell it so he just gave it back to them and walked away. He went on a heart transplant list and shortly thereafter died while waiting for a transplant. He was not able to leave anything to his family as a result of the 10 years he invested, the blood, the sweat, and the hope he had put into the position of being an owner of a chem dry franchise.
It is Bad, they are immoral, and most of you will Lose more than I can say.