1-800-GOT-Junk Franchise Cost, Profit, Failure Rate 2024

The junk removal industry might seem like a great idea due to the business’s continuous nature.

There is less risk and longer life expectancy for the companies. 1-800-GOT-JUNK is one of the most famous junk removal franchises in North America. This is one of the 10 best janitorial franchises that you must own.

Are you considering owning a franchise of this brand and being a part of their name?

You can actually do this because the company is open to new franchisees, and you can apply to be one. This article will cover all the details about 1-800-GOT-JUNK’s franchise system.

1-800-GOT-Junk Franchise

About 1-800-GOT-Junk

1-800-GOT-JUNK is a Canadian junk removal franchise. It was founded in 1989 with just a single junk hauling truck to revolutionize the disposal of unwanted items.

This innovative approach to junk removal laid the foundation for what would later become a highly successful franchise opportunity.

They offer comprehensive junk removal solutions to both residential and commercial customers and specialize in responsibly disposing of unwanted items, including furniture, appliances, electronics, yard waste, construction debris, and more.

The company has been franchising since 1999 and has quickly grown over the years. They now have over 150 stores and an established franchising system.


1-800-GOT-Junk Franchise Model

Cost or FeeAmount or Percentage
Initial Investment       $162,800-$245,250
FranchiseYES
Franchising Since1999
Franchise-Fee$65,000-$97,500
Royalty-Fee8%
Liquidity$90,000
Estimated Outlets155

How Much Does It Cost to Open a 1-800-GOT-JUNK Franchise?

The average total cost to open a 1-800-GOT-JUNK franchise is between $162,800 and $245,250.

This total cost includes the franchise fee of between $65,000 and $97,500 and all other startup costs.

Depending on your location, the size of the store, and other important factors, the total cost might go up or down out of this range.


1-800-GOT-JUNK Franchise Requirements

There is no professional requirement to be a 1-800-GOT-JUNK franchisee. However, you do need to possess liquidity of a minimum of $90,000 and a net worth of at least $30,000.

If you can comply with these, you fulfill the necessary requirements to apply for a franchise store.

If you have a background in your career with management or with the junk removal industry overall, this is beneficial but not a must.


1-800-GOT-JUNK Profit & Revenue

1-800-GOT-JUNK Profit & Revenue

The latest reports by the company for the year 2020 show that the average gross revenue for a store is between $310,000 and $320,000 annually.

This changes drastically depending on the country you operate in. A franchise store also averages close to $2 million in gross sales annually.


1-800-GOT-JUNK Franchise Owner Salary

There is no official information about how much a franchise owner makes for the 1-800-GOT-JUNK franchise.

This is mainly because the company doesn’t frequently share its financials with the public.

However, the industry average profit margin is between 15% to 20%. Knowing that an average store makes between $310,000 and $320,000 annually, we can conclude that a franchise owner can make between $62,000 and $64,000 in net profit annually. 

This is how we calculated this amount:

Financial OverviewPercentage of RevenueAmount ($)
Individual Franchise Annual Revenue100%320000.00
Rent10.00%(32000.00)
Insurance5.00%(16000.00)
Salaries20.00%(64000.00)
Franchise Royalty Fees5.00%(16000.00)
Utilities2.00%(6400.00)
Cost of Goods Sold (COGS)25.00%(80000.00)
Labor (Variable)13.00%(41600.00)
Total (Expenses)80.00%(256000.00)
Net Profit20.00%64000.00

Note: The displayed expenses are estimates based on industry averages and standard costs. Actual expenses may vary due to factors like location, business size, and market conditions. We recommend conducting detailed research or consulting with a financial advisor for a tailored financial analysis.


1-800-GOT-JUNK Training and Support

The franchisor provides a training program for the principal operator and any other kind of manager that the franchisor wants.

This training focuses on teaching business operating systems and has both in-class and in-field training.

The entire program is for five days, and everything happens in 1-800-GOT-JUNK’s principal offices in Vancouver.

Once the store is open, there must be a revisit training within 180 days for the franchisee’s operation.

They also support you by providing you with revisiting your store and training your employees and managers from time to time.

You also get annual conferences set up by the company to learn about business operations.


1-800-GOT-JUNK Terms of Agreement and Renewal

1-800-GOT-JUNK Terms of Agreement and Renewal

The length of the initial franchise agreement is for five years. At the end of this five-year term, renewal is possible between the franchisee and the franchisor.

The renewal terms are three additional five-year terms. The renewal is only available if the franchisee meets the requirements and the franchisor is happy with the franchisee.


1-800-GOT-JUNK Obligations and Restrictions

The franchised locations must be constantly supervised by someone who has beneficial share ownership in the business.

This person is designated in the franchise agreement as the “principal operator,” and this operator must devote their full-time effort to the store’s management. 

The franchisee is also obligated to perform all services and offers all products that the franchisor asks for in the franchise agreement.


1-800-GOT-JUNK Financial Assistance

In essence, the franchisor does not offer any kind of direct financial assistance.

However, they might allow, in certain cases, to divide the payment of the franchise fee in installments without interest payments.

This is possible if the franchisee ensures to make the payments on time without delay. In some other cases, the franchisor might introduce the franchisee to a third-party institution.

This does not guarantee any kind of assistance but creates help for the franchisee to get the necessary financing.


Failure Rate Of 1-800-GOT-JUNK

Franchised Outlets:

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change
20181301300
2019130128-2
20201281280

For the Franchised outlets:

  • In 2018, the failure rate was (0)/130×100≈0.00%
  • In 2019, the failure rate was (2)/130×100≈1.54%
  • In 2020, the failure rate was (0)/128×100≈0.00%

Company-Owned Outlets:

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change
2018000
201901+1
202013+2 

For the Company-Owned outlets:

  • In 2018, the failure rate was (0)/0×100≈0.00%
  • In 2019, the growth rate was (1)/0×100≈0.00%
  • In 2020, the growth rate was (2)/1×100≈200%

Total Outlets:

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change
20181301300
2019130129-1
2020129131+2

For Total outlets:

  • In 2018, the failure rate was (0)/130×100≈0.00%
  • In 2019, the failure rate was (1)/130×100≈0.77%
  • In 2020, the growth rate was (2)/129×100≈1.55%

According to the above-mentioned data, we can see that the franchised outlets for 1-800-GOT-JUNK declined from 2018 to 2020, showing a failure rate between 0.00% and 1.54%.

On the other hand, for company-owned outlets, the growth rate of 1-800-GOT-JUNK was lying in the range between 0.00% and 200% for the same period of time.

Overall, when we combine the data of franchise and company-owned outlets, we can see that the 1-800-GOT-JUNK franchise has declined in the years 2018-2020 showing a total failure rate between 0.00% and 0.77%. However, the company started to grow in the year 2020, showing a growth rate of 1.55%.


Payback Period Of 1-800-GOT-JUNK

With a midpoint investment of $206,825 and the yearly profit of $64,000, we can calculate the payback period of the 1-800-GOT-JUNK Franchise.

So, to find out how long it will take to earn back the initial investment:

Payback Period = Midpoint Investment / Yearly Profit = $206,825 / $64,000 = 3.23 years

Based on these figures, it will take approximately 3 to 4 years to pay back the initial investment for 1-800-GOT-JUNK. This time period could be longer or shorter depending on your sales, revenue, and profit figures.

If opening a cleaning franchise appeals to you, consider ServiceMaster Clean, Ductz Franchise, Merry Maids Franchise, Servpro, or Stanley Steemer as viable options.


1-800-GOT-JUNK Comparison

NameFranchise FeeRoyalty FeeInitial Investment
College HUNKS Hauling Junk & Moving$45,000-$65,0007%$158,700-$288,500
Junk King$54,000-$78,00012%$89,850-$175,440
1-800-GOT-JUNK$65,000-$97,5008%$162,800-$245,250

Conclusion

1-800-GOT-JUNK is a big and dominant player in the junk removal industry, operating for decades.

They offer franchises, and they have an established franchise practice for the franchisees with thorough training, support, obligations, and financial assistance partners.

Their established brand name also helps the franchisees to succeed easier and make more money than an average junk removal business.

On average, 1-800-GOT-JUNK franchise owners make between $62,000 and $64,000 annually in net profit based on the available numbers. This makes it a great business as this is a great number in the industry.

People also often wonder about hiring 1-800-GOT-Junk for cleaning but also wonder about whether 1-800-GOT-Junk is really expensive and what is the minimum price for 1-800-GOT-Junk.


FAQs

Is 1-800-GOT-JUNK a franchise?

Yes, 1-800-GOT-JUNK is currently a franchise. They have been offering this opportunity since 1999 actively.

How much does it cost to open a 1-800-GOT-JUNK franchise?

The average total cost to open a 1-800-GOT-JUNK franchise is between $162,800 and $245,250.

This includes all kinds of startup costs, such as the franchise fee of between $65,000 and $97,500 and all other related costs.

Who owns 1-800-GOT-JUNK?

The owner of 1-800-GOT-JUNK brands is O2E Brands. The company was founded by Brian Scudamore, and he is still currently the CEO of the company.

How many locations does 1-800-GOT-JUNK have?

1-800-GOT-JUNK has 160+ franchise locations and over 1500 active trucks, all majorly operating in the USA, Canada, and Australia.

Where is 1-800-GOT-JUNK headquartered?

The headquarters of 1-800-GOT-JUNK is located in Vancouver, Canada.

Sources

https://en.wikipedia.org/wiki/1-800-GOT-JUNK%3F

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