Color Glo International Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$63,300 - $68,375
Franchise Fee
$40,000
Min Cash Required
$500
Total US Locations
70
Business Summary
Color Glo International operates a mobile service business focused on the repair and restoration of leathers, vinyls, velour, hard plastics, fabrics, carpet, and wood grain panels. Color Glo International's services cater to various markets including automotive, aircraft, marine, and furniture. Franchisees are trained to acquire specific skills and use proprietary products to perform these specialized restoration services.
Corporate History
Color Glo International, as a division of CGI International, Inc., has a history that traces back to 1977. The original entity, Color Glo International, Inc., was incorporated on March 31, 1977, and initially marketed Color Glo products as a business opportunity. CGI International, Inc. was incorporated on February 25, 1983, with the purpose of offering Color Glo business format franchises. CGI International, Inc. later purchased and merged with the original Color Glo International, Inc. on November 1, 1993. Additionally, CGI International, Inc. merged with Coustic-Glo International, Inc. on March 22, 1994, and continues to sell Coustic-Glo franchises. The Color Glo business system, focused on the repair and restoration of various materials, has been developed and improved since 1976.
Financial Overview
Investment Range
$63,300 - $68,375
Franchise Fee (Low)
$40,000
Franchise Fee (High)
$40,000
Minimum Cash Required
$500
Royalty %
4%
Equipment Costs (Low)
$21,700
Equipment Costs (High)
$21,800
Working Capital
$1,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Color Glo International's financial statements for the fiscal years ending August 31, 2023, 2022, and 2021 have received an unqualified audit opinion, indicating they are presented fairly in all material respects. The company utilizes lines of credit that, as of August 31, 2023, carried high interest rates of 13.50% and 21.90%, secured by the company's assets. Additionally, Color Glo International had notes payable, including a remaining balance of $85,559 from a PPP loan as of August 31, 2023. The financial statements also reflect operating lease liabilities and a lease expense of $98,745 for 2023. A 'Going concern modification' was noted by a *prior* CPA under *old* accounting guidance for a capital lease, but this does not appear to be a current concern reflected in the most recent unqualified audit opinion.
Financing Details
Color Glo International does not offer any direct or indirect financing to its franchisees. The franchisor also does not guarantee any notes, leases, or other financial obligations for franchisees. However, Color Glo International is able to refer prospective franchisees to third-party lenders who may be willing to provide financial arrangements.
Performance Metrics
Total US Locations
70
Franchised Units
70
Corporate Units
0
Franchising Since
1983
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Count
1
Litigation Summary
Color Glo International had one lawsuit that was filed on December 14, 2012, by former franchisees, American Refinishing, LLC, John Sellenberg, and Judy Sellenberg. The lawsuit, filed in Davidson County, Tennessee, alleged that the product did not work properly and sought rescission of the contract or damages under the Tennessee Consumer Protection Act. Color Glo International denied fraud or misrepresentation and counterclaimed for damages, stating the plaintiffs failed to follow marketing and training instructions and properly use Color Glo products. The case was settled, and an Order of Dismissal was entered on July 16, 2014, which included payments to the plaintiffs of $70,000. This is the only litigation Color Glo International has been required to disclose.
Bankruptcy History
Color Glo International has no bankruptcy information required to be disclosed in this Item.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew their franchise agreement, Color Glo International franchisees must provide written notice of their intention to renew at least 90 days before the current term ends. They must also have complied with all material terms and conditions of the Franchise Agreement, including operating and quality standards, and must have paid all monetary obligations to Color Glo International in a timely manner. Additionally, franchisees will be required to sign a new standard Franchise Agreement, which may contain terms and conditions that are materially different from their original agreement. Although a new agreement is required, franchisees will not have to pay another Initial Fee upon renewal.
Training & Support Program
Franchisor Assistance
Before opening their business, Color Glo International provides franchisees with a schedule of all approved supplies and equipment, an initial supply of Color Glo products (the Start-Up Kit), and a copy of the confidential Operations Manual. Initial training for the franchisee and one additional person generally lasts three weeks and covers topics such as Color Glo's system, equipment overview, repair procedures, color mixing, Hazmat training, sales, and marketing. This training is held at the corporate office in Minneapolis, Minnesota, and in the franchisee's market area, with field training provided by experienced franchisees. During the operation of the franchise, Color Glo International provides advertising production materials, conducts necessary business inspections, protects its trademarks and business system, and issues supplements and modifications to the Operations Manual. Franchisees must participate in mandatory annual International Seminars for new product and service training, covering their own travel and living expenses, and potentially a registration fee. Color Glo International also coordinates with approved internet marketing suppliers, though franchisees pay these suppliers directly, and encourages participation in a communication/forum group via the Color Glo Intranet system.
Initial Training Hours
131
Training Location
Corporate Office in Minneapolis, Minnesota, and the franchisee's market area
Ongoing Support
After opening, Color Glo International provides ongoing support to its franchisees by offering certain advertising production materials and inspecting their businesses as often as deemed necessary. The franchisor is also responsible for protecting its trademarks and business system, and for providing supplements and modifications to the Operations Manual. Franchisees are required to attend an annual International Seminar, typically lasting up to three days, where new products and services are introduced and additional training is provided. Franchisees are responsible for their own travel and living expenses for this mandatory training, and Color Glo International may charge a registration fee. Additionally, franchisees are encouraged to monitor and participate in a communication forum group available through the Color Glo Intranet system. While Color Glo International does not maintain a funded advertising program, it coordinates with approved internet marketing suppliers (such as Google AdWords), for which franchisees pay directly.
Franchise Requirements
Ideal Candidate Profile
Color Glo International requires that the franchisee personally manage or operate their Color Glo business, or ensure that an operator or manager does so. This individual must complete the Color Glo training program and cannot have any business relationship or interest with Color Glo International's competitors. While not required to perform the actual labor, the owner or manager must acquire the knowledge through training and experience to effectively supervise employees or contractor laborers. The operator of the business must also hold at least a 10% ownership interest in the franchise. Color Glo International reserves the right to require the manager or operator to sign a confidentiality agreement for trade secrets. Franchisees must be individuals, not corporations.
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
Exclusive
Territory Size Requirements
Color Glo International grants each franchisee an Exclusive Territory that requires a minimum population of 500,000 people. The exact boundaries of these territories are negotiated based on the most recent city and county census figures available. Franchisees have the option to acquire a larger Exclusive Territory for an additional fee, calculated at $500 for every increase of 10,000 in population exceeding the 500,000 minimum.
Staffing Notes
Color Glo International requires that franchisees hire enough adequately trained and competent persons to ensure efficient service to customers. While franchisees are not required to perform the actual labor themselves, they must acquire the knowledge through training and experience to supervise their employees or contractor laborers when owning and managing a Color Glo business. The individual operating or managing the Color Glo business must complete the franchisor's training program.