Coit Services Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$40,596 - $201,500
Franchise Fee
$11,300
Min Cash Required
$9,000
Total US Locations
49
Business Summary
COIT Services, Inc. operates businesses that specialize in high-quality residential and commercial cleaning services. COIT franchisees provide core services such as cleaning window coverings, carpets, area rugs, upholstery, air ducts, and tile and grout. COIT may also offer qualified franchisees the option to provide additional services like disaster restoration, stone cleaning and restoration, and wood floor services.
Corporate History
COIT Services, Inc.'s business began in 1950 when its founder, Louis J. Kearn, started COIT Drapery Cleaners as a sole proprietorship. The company began franchising in 1963. In 1966, COIT Drapery Cleaners, Inc. was formed as a California corporation to operate the business, and it later changed its name to COIT Services, Inc. in 1993. COIT has continuously operated company-owned locations under the COIT brand since 1950.
Financial Overview
Investment Range
$40,596 - $201,500
Franchise Fee (Low)
$11,300
Franchise Fee (High)
$60,000
Minimum Cash Required
$9,000
Royalty %
7%
Marketing %
1.5%
Equipment Costs (Low)
$1,658
Equipment Costs (High)
$118,725
Working Capital
$29,500
Audited Financials
Yes
Offers Financing
Yes
Audit Opinion
Unqualified opinion
Financial Health Notes
COIT Services, Inc. has experienced suppressed sales and operating losses in 2022 and 2023, mainly due to the COVID-19 pandemic, labor shortages, increased labor costs, supply chain issues, and credit losses. The company received significant government support, including $5,996,136 from the Employee Retention Credit program in 2023, which is currently recorded as a deferred gain and is subject to audit. Despite these challenges, COIT's management believes it has sufficient resources to meet its cash flow needs for at least one year from the financial statements' issuance date.
Financing Details
COIT Services, Inc. offers direct financing for a portion of the initial franchise fee for Core Services franchisees. If a franchisee meets COIT's credit standards, the company will finance up to 75% of the initial franchise fee or $30,000, whichever amount is less. The repayment period for this loan can range from 24 to 48 months, with an annual interest rate of 12% on the unpaid balance. Qualification for the loan depends on factors like the territory size, the franchisee's business experience, credit history, assets, and debts. The loan is secured by a personal guaranty from all owners of the franchisee entity.
Performance Metrics
Total US Locations
49
Franchised Units
40
Corporate Units
9
Franchising Since
1963
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
COIT Services, Inc. has no litigation to report.
Bankruptcy History
COIT Services, Inc. has no bankruptcy history to report.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To qualify for a successor franchise, COIT Services, Inc. franchisees must maintain good standing and comply with all terms of their Franchise Agreement throughout the initial term. They are required to provide COIT with notice between 9 to 12 months before their current agreement expires, execute COIT's then-current form of Franchise Agreement (which may have different terms), meet the current standards for new franchisees, complete any necessary refresher training, and have the right to possess their franchise premises. Additionally, COIT franchisees must pay a renewal fee equal to 10% of COIT's then-current initial franchise fee.
Training & Support Program
Franchisor Assistance
COIT Services, Inc. provides comprehensive assistance to its franchisees. Before opening, COIT helps with standards for equipment and supplies, licenses and trains on its proprietary COES software, conducts an initial training program, loans Operating Manuals, and offers suggestions for grand opening advertising and promotional campaigns. Upon request, COIT can also provide a marketing analysis of the territory. For franchisees offering additional services like Disaster Restoration, Stone Restore, or Wood Floor, COIT provides initial training for those specific offerings. After the business opens, COIT offers additional training courses and refresher training for its COES software. COIT organizes an annual national convention that franchisees or their designated managers must attend, providing updates on industry information, products, advertising, and business management, along with networking opportunities. Ongoing operational assistance includes advice on improving profitability, ensuring quality standards, developing advertising and promotional programs, sales strategies, and using their IT and accounting systems. Franchisees receive updates to the Operating Manuals, can consult on employee training, and receive sample advertising, and COIT's chart of bookkeeping accounts.
Initial Training Hours
73
Training Location
Minneapolis, MN
Ongoing Support
After opening, COIT Services, Inc. provides franchisees with continuous support through various channels. This includes offering additional training courses and refresher training for their proprietary COES software. COIT organizes an annual national convention that franchisees or their designated managers must attend, providing updates on industry information, products, advertising, and business management, along with networking opportunities. The franchisor also offers operational assistance and guidance on improving profitability, maintaining quality standards, developing advertising and promotional programs, sales strategies, and using their IT and accounting systems. Franchisees receive updates to the Operating Manuals, can consult on employee training, and receive sample advertising materials. COIT provides telephone assistance for COES software updates and changes.
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
Supervisory
Territory Type
Limited
Territory Size Requirements
COIT Services, Inc. territories are defined as a geographical area that typically contains at least 100,000 households. Territories are generally not granted larger than 500,000 households, although COIT reserves the right to do so, and territories may be smaller depending on the specific market area.
Staffing Notes
COIT Services, Inc. franchisees are required to have a full-time manager for the franchised business who must successfully complete the initial training program, though this manager does not necessarily need to be an owner. For franchisees offering Disaster Restoration Services, there must always be at least one person on staff certified by the Institute of Inspection, Cleaning and Restoration Certification (IICRC) or equivalent in Water Damage, Applied Structural Drying, and Applied Microbial Remediation. Similarly, for Stone Restore Services, a certified person in natural stone cleaning and restoration is required, and for Wood Floor Services, a trained person must be on staff. Before hiring any employee who will enter customer homes, COIT franchisees must conduct background checks to ensure they do not have a history of violence, dishonesty, or other undesirable behavior that could negatively impact the COIT brand.