Chem-Dry Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$67,600 - $207,295
Franchise Fee
$5,400
Total US Locations
1,057
Business Summary
Chem-Dry, Inc. offers franchises for the operation of a Chem-Dry business. These businesses provide carpet cleaning, upholstery cleaning, spot removal, protective services, area rug cleaning, wood floor cleaning, and tile and stone care services to both residential and commercial customers. Chem-Dry businesses utilize specialized equipment, cleaning solutions, and operating procedures developed by Chem-Dry, Inc., including a patented carbonating cleaning system. Franchisees operate their businesses from a single location within a non-exclusive franchised area, using vans to transport equipment and solutions to customer job sites.
Corporate History
Chem-Dry, Inc., originally known as Harris Research, Inc., began its corporate journey when it was first incorporated in California in November 1977. Later, in March 1994, it was incorporated in Utah. The company started offering Chem-Dry franchises in September 1978. Over time, Chem-Dry, Inc. also offered N-Hance wood cleaning franchises from 2003, with the U.S. N-Hance operations being spun off to an affiliate in 2012. A significant corporate change occurred on July 10, 2019, when BELFOR (USA) Group, Inc. acquired control of Chem-Dry's parent company, BFG Holdco, Inc. (formerly HRI Holding, Inc.), making Chem-Dry, Inc. a wholly-owned subsidiary of BELFOR. In February 2023, Harris Research, Inc. officially changed its name to Chem-Dry, Inc.
Financial Overview
Investment Range
$67,600 - $207,295
Franchise Fee (Low)
$5,400
Franchise Fee (High)
$60,500
Equipment Costs (Low)
$34,600
Equipment Costs (High)
$141,295
Working Capital
$5,750
Audited Financials
Yes
Offers Financing
Yes
Audit Opinion
Unqualified opinion
Financial Health Notes
BFG Holdco, Inc., Chem-Dry's parent company, maintains a solid working capital of $9,414,000 as of December 31, 2024. However, the company has experienced significant goodwill impairment losses, amounting to $45,537,000 in 2023 and $10,519,000 in 2024. These impairments are attributed to a combination of deteriorating economic conditions, rising interest rates, increased cost of accessible debt, and strategic shifts focused on reducing the overall size of its franchise network. Additionally, Chem-Dry, Inc. has reported consolidated net losses for three consecutive years: $11,108,000 in 2024, $44,277,000 in 2023, and $6,330,000 in 2022.
Financing Details
Chem-Dry, Inc. may offer to finance up to 50% of the Initial License Fee portion of the total Initial Fee through a Business Note. The financing term for this loan can be up to 36 months, with a simple interest rate of 9%. Payments for the Business Note typically begin in the fourth month following the completion of New Buyer Training, or in the fourth month after the Franchise Agreement is signed for existing franchisees. Chem-Dry, Inc. does not offer direct financing for the Initial Package (which includes equipment and products) but may consider financing the Initial License Fee based on a franchisee's creditworthiness and collateral.
Performance Metrics
Total US Locations
1,057
Franchised Units
1,057
Corporate Units
0
Franchising Since
1978
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
2
Litigation Summary
Chem-Dry, Inc. has two litigation cases to report within the last three years. In one case filed on February 10, 2025, Chem-Dry, Inc. sued former franchisees for breaching their post-termination non-competition agreements, contract violations, trade dress infringement, and unjust enrichment. This case was settled, with the defendants agreeing to cease competitive operations and refrain from using Chem-Dry, Inc.'s confidential information and trade dress. In another case filed on March 24, 2022, a former Chem-Dry franchisee sued Harris Research, Inc. (now Chem-Dry, Inc.) for breach of contract, breach of fiduciary duties, tortious interference, defamation, conversion, statutory violations, and emotional distress. This matter included a parallel arbitration proceeding and was settled on May 5, 2023, with Chem-Dry, Inc. paying $225,000 to the former franchisee.
Bankruptcy History
Chem-Dry, Inc. has no bankruptcy history to report.
Agreement Terms
Initial Term
5 years
Renewal Term
5 years
Renewal Conditions
To renew their Chem-Dry franchise, franchisees must notify Chem-Dry, Inc. of their intent to renew between six and nine months before the current agreement expires. They must be in good standing, without any defaults, and have successfully completed all current training courses. As part of renewal, Chem-Dry, Inc. may require franchisees to refurbish their equipment and vans, sign a general release, agree to the then-current form of franchise agreement (which may include different terms, higher fees, or new service offerings), pay a successor fee, and purchase any required new or replacement equipment to meet current System Standards.
Training & Support Program
Franchisor Assistance
Chem-Dry, Inc. provides comprehensive support to its franchisees. Before opening, it designates the franchised area, delivers an initial package of cleaning solutions, supplies, equipment, and vouchers for printed materials, provides an electronic operating manual, and offers initial training for the franchisee and designated employees. After opening, Chem-Dry, Inc. offers ongoing guidance on operating issues, standards, and procedures through the manual, bulletins, internet, newsletters, and consultations. It periodically revises the manual and conducts additional training and conventions covering administrative, accounting, pricing, and inventory control. The franchisor inspects business operations, provides updated training, offers advertising materials for purchase, and manages billing and collections for national accounts, remitting payments to franchisees minus a handling fee.
Initial Training Hours
61
Training Location
Hybrid of online training at the franchisee's location and in-person training in Ann Arbor, MI, or another designated location.
Ongoing Support
After opening, Chem-Dry, Inc. provides ongoing support by offering advice on operating issues and guidance on standards and procedures, which includes updates to the operating manual, bulletins, online resources, newsletters, and telephone consultations. The franchisor conducts additional training and conventions to cover improvements in administrative, bookkeeping, accounting, pricing, and inventory control. Franchisees are required to complete at least one in-person training course annually and various online modules, as well as attend a minimum of two conventions during their franchise term. Chem-Dry, Inc. also inspects operations to ensure compliance with standards and provides materials for local advertising, while managing national account programs and leads.
Franchise Requirements
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Hybrid
Owner Participation
Absentee Allowed
Territory Type
Non-Exclusive
Territory Size Requirements
Chem-Dry territories are non-exclusive and primarily defined by population. The number of Chem-Dry franchises that can operate in a specific area is determined by dividing the current population of that area by 60,000, with the resulting whole number representing the maximum number of franchises Chem-Dry, Inc. may grant. Typically, a franchised area has a minimum population of at least 60,000, though in some rural areas, a territory might have a population as small as 5,000. Chem-Dry, Inc. defines the franchised area based on factors such as population, population density, geographical terrain, and market potential.
Staffing Notes
Chem-Dry franchisees are solely responsible for all employment decisions, including hiring, firing, setting compensation, and managing personnel. While Chem-Dry, Inc. does not directly advise on or participate in hiring, it does provide guidance on job descriptions for roles such as Technician/Salesperson, Office Staff/Scheduler, and Commercial Salesperson. Franchisees are prohibited from using independent contractors to perform services for customers. If a franchisee chooses to designate an operator to run the business, that individual must successfully complete Chem-Dry, Inc.'s initial training program within 90 days of their employment, and all employees are required to sign confidentiality agreements.