1-800-Got-Junk? Franchise Review – Average, Median, High, and Low Gross Sales for Franchised Businesses in the US, Canada, and Australia (2020 FDD) | Franchise Chatter9 min read

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1-800-Got-Junk? Photo by Photo Nut 2011

In this FDD Talk post, you’ll learn the following:

  • Section I – Background information on the 1-800-Got-Junk? franchise opportunity, including relevant news updates
  • Section II – Estimated initial investment for a 1-800-Got-Junk? franchise, based on Item 7 of the company’s 2020 FDD
  • Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a 1-800-Got-Junk? franchise, based on Items 5 and 6 of the company’s 2020 FDD
  • Section IV – Number of franchised and company-owned 1-800-Got-Junk? outlets at the start of the year and the end of the year for 2017, 2018, and 2019, based on Item 20 of the company’s 2020 FDD
  • Section V – Presentation and analysis of 1-800-Got-Junk?’s financial performance representations, based on Item 19 of the company’s 2020 FDD, including information on the:
  • 2019 average, median, highest, and lowest gross sales for the 129 franchised 1-800-Got-Junk? businesses that have been in operation for more than one day and made any gross sales at any point during the 12-month period ending on December 31, 2019, grouped according to number of months in operation (more than 1 day, but less than 12 months; more than 12 months, but less than 24 months; more than 24 months, but less than 36 months; more than 36 months, but less than 48 months; more than 48 months, but less than 60 months; more than 60 months, but less than 72 months; and more than 72 months)
  • number and percentage of franchisees in the United States, Canada, and Australia (separately stated) generating total revenue of greater than $1,000,000, from $750,001 to $1,000,000, from $500,001 to $750,000, and $500,000 or less, respectively
  • total 2019 gross revenue of 1-800-Got-Junk? Franchised Businesses operating in the United States, Canada, and Australia that reported revenue and were open on December 31, 2019

Section I – Background Information

14 Things You Need to Know About the 1-800-Got-Junk? Franchise

Benefits from Increased Desire to Declutter Amid Ongoing COVID-19 Pandemic

1.  In mid-October 2020, 1-800-Got-Junk? said that it has observed an increased desire to declutter as people have been spending more time at home. From January to September 2020, 1-800-GOT-JUNK? customers continued to cite “decluttering” as the number one reason for needing junk removal, with an increase of 5% over the same period in 2019.

2.  In addition, recent months have also shown a steady increase in customers citing moving, renovating, or purchasing big ticket items as a reason for using 1-800-Got-Junk? services, making up 20% of the company’s business in total. These trends have driven up to a 10% increase in jobs year-over-year for the junk hauling giant.

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3.  David St. James, managing director of 1-800-Got-Junk?, said, “It’s clear customers are not only spending more time at home, but they’re also investing in their home. People want to make more room at home for living, working and doing the things that they enjoy, so they are removing clutter, renovating, buying big ticket items or moving into a new space entirely.”

4.  1-800-Got-Junk? prides itself on making junk disappear by helping customers get rid of unwanted items, recycling the recyclables, and donating the donatables along the way. Whether decluttering, moving, or renovating, no job is too big for its friendly, uniformed Truck Team Members.

5.  With health and safety a top priority, 1-800-Got-Junk? offers No Contact Junk Removal, allowing for the estimate, junk removal, and payment to be completed without direct contact. In addition, 1-800-Got-Junk? has taken proactive steps to keep their customers and teams safe, including physical distancing, frequent hand washing, disinfecting high touch surfaces, and wearing gloves.

Seeks Media Partner for the First Time

6.  In mid-July 2020, 1-800-Got-Junk? announced that it was seeking a media partner for the first time in the company’s history. The company issued a media RFP (request for proposal). 1-800-Got-Junk? has mainly been negotiating its own media buys for the last 30 years, with a particular focus on radio buying and TV sponsorships. Now, the company says it has aggressive growth targets that it can only meet with a more robust media plan, and it’s looking for a media partner to help it in that regard.

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7.  A company rep said that although the corporation “has built and maintained long-term relationships” with a number of marketing partners over the past 35 years, this is indeed the first time the organization has engaged in a bid process for a potential media buying partner – or, potentially, multiple media partners.

8.  The Vancouver-headquartered company operates in three different markets: Canada, the U.S., and Australia, with more than 150 franchises across the three countries (at the time of the announcement). The company spokesperson says it is using the RFP process not necessarily to select a single agency of record, but to “determine what is right for our business,” which could include a single agency, or a roster, if they find that works better. “While there are pros and cons with a single assignment, we are using this process to assess what is best for our franchise partners and business as a whole.”

9.  The primary focus of the RFP, says the company rep, is to support mass media. “That said, we are evaluating digital capabilities to support and enhance the strong team we have built internally that supports our digital advertising efforts.” The closing date for proposals was August 3, 2020 and presentations for shortlisted agencies was scheduled for the week of August 24.

Switches to No Contact Junk Removal as COVID-19 Pandemic Continues

10.  Not long after COVID-19 restrictions hit North America in March 2020, 1-800-Got-Junk? restructured its practices into No Contact Junk Removal services. This now allows 1-800-Got-Junk? to remove items without direct contact, to ensure the comfort and safety of customers and its teams. It’s still easy to make junk disappear – all customers have to do is point. It’s full-service junk removal, but customers don’t have to touch anything, and team members touch only the things they’re going to carry away.

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11.  Here is how No Contact Junk Removal works:

  • 1-800-Got-Junk?’s team will call ahead to confirm a customer appointment and reassure that they’re healthy and that team members are healthy.
  • Team members will also confirm details, like where the items are located and how to access them.
  • When the team arrives, they’ll greet customers with smiles instead of a handshake.
  • The team will get to work with customer’s no contact estimate, done over the phone, or at a safe physical distance.
  • To further minimize contact, clients can also move their junk outside for the team, if they wish.
  • If the junk is inside, team members must be able to maintain 6 feet of distance at all times.
  • The team will remove the items, load up the truck, and sweep up the area when they’re done.
  • When the job is finished, payment can be processed without any contact.
  • 1-800-Got-Junk? will do its best to donate or recycle items where possible. (Organizations in some areas may not be accepting donations at this time, so donating items may not always be possible.)

Company History

12.  1-800-Got-Junk? was founded in 1989 by Brian Scudamore in Vancouver, British Columbia, Canada. At the time, Scudamore was in college and was looking for a summer job when he saw an old, junk hauling truck in a McDonald’s drive-thru. Scudamore was inspired to start his own junk removal service and dubbed it “The Rubbish Boys.” The junk removal business was a success and despite his father’s wishes, Scudamore dropped out of school to pursue the business full time.

13.  Over the next decade, Scudamore continued to grow his junk removal business and decided to start franchising in 1997. A year later, Scudamore changed the company’s name to 1-800-Got-Junk? and opened more locations around Canada. In 2000, the first 1-800-Got-Junk? franchise outside of Canada was opened in Portland, Oregon, USA. The great success of 1-800-Got-Junk? led Scudamore to form O2E brands, which is now the parent company of several other home service brands including Wow 1 Day Painting and Shack Shine.

Entrepreneur’s Franchise 500

14.  1-800-Got-Junk? ranked No. 444 on Entrepreneur’s 2020 Franchise 500 list.

Section II – Estimated Costs

  • Please click here for detailed estimates of 1-800-Got-Junk? franchise costs, based on Item 7 of the company’s 2020 FDD.

Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees

  • Please click here for detailed information on 1-800-Got-Junk?’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2020 FDD.

Section IV – Number of Franchised and Company-Owned Outlets

Franchised

2017

  • Outlets at the Start of the Year:  131
  • Outlets at the End of the Year:  130
  • Net Change:  -1

2018

  • Outlets at the Start of the Year:  130
  • Outlets at the End of the Year:  130
  • Net Change:  0

2019

  • Outlets at the Start of the Year:  130
  • Outlets at the End of the Year:  128
  • Net Change:  -2

Company-Owned

2017

  • Outlets at the Start of the Year:  0
  • Outlets at the End of the Year:  0
  • Net Change:  0

2018

  • Outlets at the Start of the Year:  0
  • Outlets at the End of the Year:  0
  • Net Change:  0

2019

  • Outlets at the Start of the Year:  0
  • Outlets at the End of the Year:  1
  • Net Change:  +1

Section V – Financial Performance Representations (Item 19, 2020 FDD) and Analysis

  • The following table presents the average gross sales realized by certain 1-800-Got-Junk? franchisees as of December 31, 2019.
  • The franchisor has provided you with this information to help you make a more informed decision about its franchises. You should conduct your own research to assist you in preparing projections for your own Franchised Business.
  • Unless otherwise specified, “Gross Sales” means the actual gross sales billed to consumers for products and services less taxes collected and credits or refunds given in accordance with the franchisor’s refund policy.
  • The information provided below was compiled from the 129 Franchised Businesses that have been in operation as a franchisee for more than one day and made any gross sales at any point during the 12-month period ending on December 31, 2019.
  • None of the underlying data supplied to the franchisor has been audited.
  • You should note that gross sales will be dependent, among other things, upon the size of the territory in which the Franchised Business operates and the number of trucks operating in that territory.

Part 1 – Average Gross Sales of 1-800-Got-Junk? Franchisees for the 12 Months Ending December 31, 2019

Franchisees Operating for More Than One Day, But Less Than 12 Months

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