Dentsmart Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$79,100 - $110,500
Franchise Fee
$20,000
Min Cash Required
$20,000
Total US Locations
17
Business Summary
Dentsmart offers franchises for vehicle paint-free dent removal (PDR) businesses that operate under the Dentsmart brand. These businesses primarily partner with body shops and insurance companies to provide PDR repairs to their customers and claimants. Franchisees are responsible for managing the business operations, marketing to body shops and insurance contacts, recruiting and training technicians, and overseeing the provision of services within their assigned territory. Dentsmart franchises can be operated from a home office, though a professional office may be required if deemed necessary for proper operation.
Corporate History
Dentsmart LLC was formed in Illinois on July 6, 2022. The company acquired the Dentsmart brand and its existing franchise system from its predecessor, Dentsmart, Inc., on December 29, 2022. Dentsmart, Inc. originally founded the brand and began offering license agreements in 2001, then started franchising under the Dentsmart name in January 2010. Notably, Dentsmart LLC's current owners, Nate Webb and Jeff Williams, have a long history with the brand, having operated Dentsmart franchises themselves since 2014 and 2008, respectively. Dentsmart LLC began offering its own Dentsmart franchises as of the FDD's issuance date in November 2024.
Financial Overview
Investment Range
$79,100 - $110,500
Franchise Fee (Low)
$20,000
Franchise Fee (High)
$25,000
Minimum Cash Required
$20,000
Royalty %
8%
Equipment Costs (Low)
$13,000
Equipment Costs (High)
$14,000
Working Capital
$30,000
Audited Financials
Yes
Offers Financing
Yes
Audit Opinion
Unqualified opinion
Financial Health Notes
Dentsmart LLC's financial statements for the year ended December 31, 2023, received an unqualified opinion from its independent auditor, indicating that they present fairly in all material respects. The auditor did not identify any substantial doubt about Dentsmart LLC's ability to continue as a going concern. As of December 31, 2023, Dentsmart LLC reported positive working capital with $336,057 in current assets and $297,074 in current liabilities, and a net income of $283,964. However, the company faces concentration of risk because its revenues can fluctuate significantly based on hail storms, as its business model is highly reliant on PDR repairs from weather events. It also noted that during 2023, over 20% of its total revenue came from just three franchisees. Additionally, Dentsmart LLC is currently not in compliance with Wisconsin's franchise agreement and will be required to offer rescission to a franchisee in that state.
Financing Details
Dentsmart LLC does not offer financing for the general costs required under the Franchise Agreement and does not guarantee franchisee obligations. However, Dentsmart LLC or its Brand Protection and Development Fund may offer financing to cover the costs of technician training. The amount financed can vary based on the number of technicians needing training, with interest rates typically ranging between 3-5% of prime. Franchisees generally have 24 months to repay the loan through monthly payments, and the loan may be secured by the revenue of the franchised business. Guarantors of the Franchise Agreement may also be required to guarantee these loans. Prepayment is allowed without penalty, but defaulting on payments may make the full amount immediately due.
Performance Metrics
Total US Locations
17
Franchised Units
13
Corporate Units
4
Franchising Since
2010
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Count
1
Litigation Summary
Dentsmart LLC's predecessor, Dentsmart, Inc., had one litigation case in November 2011. The State of Minnesota Department of Commerce alleged that Dentsmart, Inc. sold a franchise without proper registration. This resulted in a Consent Order in December 2011, requiring Dentsmart, Inc. to halt franchise sales in Minnesota until registered, offer rescission to the franchisee, and pay a $2,500 civil penalty. Dentsmart LLC itself does not have any recent or pending material litigation.
Bankruptcy History
Dentsmart LLC has no bankruptcy history to disclose.
Agreement Terms
Initial Term
5 years
Renewal Term
5 years
Renewal Conditions
To renew, Dentsmart franchisees must notify Dentsmart LLC between 9 and 15 months before their current agreement expires. Franchisees must not be in default and must have complied with all material terms of the agreement, including minimum marketing requirements. Dentsmart LLC must also still wish to support a business in the franchisee's territory. All debts owed to Dentsmart LLC, its affiliates, technicians, and third-party suppliers must be paid. The franchised business, including its equipment, location, and operating methods, must be brought into alignment with Dentsmart LLC's then-current standards. Franchisees must also satisfy Dentsmart LLC's current training requirements, sign the then-current successor franchise agreement, pay the applicable renewal fee, and both the franchisee and its guarantors must sign a general release.
Training & Support Program
Franchisor Assistance
Dentsmart LLC provides extensive assistance to its franchisees both before and after opening. Pre-opening support includes designating a territory, approving initial marketing plans and office locations, and delivering a comprehensive training program for owners and managers. Dentsmart LLC also offers consultations, provides access to its Operations Manual, sets up an exclusive email address and toll-free number, shares a proprietary list of local body shops, and offers 5 to 10 days of on-site assistance around the opening time. After opening, Dentsmart LLC continues to consult on operations, refines its business System and Operations Manual, and makes additional training and conferences available (some for a fee). It conducts inspections, manages a Brand Protection and Development Fund, and provides a system-wide website. Dentsmart LLC also approves advertising, offers pricing guidance, maintains a directory of Dentsmart businesses, and can provide additional technicians if a franchisee experiences high demand. Franchisees also receive guidelines for financial reporting and may be required to use specific accounting and project management software.
Initial Training Hours
200
Training Location
Franchisor location in Du Quoin or Pekin, Illinois, and at the Franchisee's location.
Ongoing Support
After opening, Dentsmart LLC provides ongoing support to franchisees including regular consultations and advice on business operations, continuous development and improvement of the Dentsmart System and Operations Manual, and offering both optional and mandatory additional training programs, conferences, and seminars (some with fees). It conducts inspections of the franchised business and its financial records, maintains a system-wide website for brand promotion and information, and manages the Brand Protection and Development Fund. Dentsmart LLC also reviews and approves all franchisee advertising, offers pricing guidance, and compiles a directory of System Businesses. For a fee, it can also provide additional technicians if a franchisee's demand exceeds their capacity. Franchisees are also required to use specific computer systems and software for reporting and operations, and may be required to attend national or regional business meetings or annual conventions, which may include a registration fee.
Franchise Requirements
Ideal Candidate Profile
Dentsmart LLC looks for franchisees who will operate their Dentsmart business on a full-time basis, especially during the initial three years before potentially delegating day-to-day management to a manager. Ideal candidates should be capable of handling administrative and business aspects, including marketing to body shops and insurance contacts, recruiting and training technicians, contracting with body shops for services, and overseeing the provision of PDR repairs in their territory.
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Hybrid
Owner Participation
Hands-On
Territory Type
Protected
Staff Count
8
Territory Size Requirements
Dentsmart defines its territories based on counties, states, or portions of states. The specific size is determined by factors such as the frequency of hail storms, the geographical area Dentsmart believes a franchisee can serve, the estimated number of body shops within the area, and the availability of qualified technicians nearby. Franchisees receive a protected area for their Dentsmart business.
Staffing Notes
Dentsmart LLC requires its franchisees to maintain a competent, trained staff and to be solely responsible for all employment decisions, including hiring, training, and compliance with labor laws. Franchisees must engage technicians who are trained in the Dentsmart System, meet specified insurance standards, and reside within one hour of the designated territory. To be recognized as a 'Franchisee Technician', a signed contract is required by April 1st each year. Franchisees are obligated to pay technicians within 90 days of a repair, even if the body shop has not yet paid the franchisee. If a franchisee cannot meet demand with their own technicians, they can use technicians from other Dentsmart businesses or those engaged by Dentsmart LLC itself, incurring a 5% referral fee. The use of non-Dentsmart affiliated technicians is restricted and only permitted under specific conditions, such as unavailability of Dentsmart technicians or customer requests, also with a 5% referral fee to Dentsmart LLC. A typical Dentsmart franchise is expected to operate with about five technicians and three administrators.