Dog grooming franchise finance
A dog grooming franchise can earn $1,200 per week and more than $2,500 per week for high-performing franchisees.
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If you'd love to work with animals but don't want to commit to years of veterinary studies or life on a farm, a pet grooming franchise may be the perfect business opportunity.
Buying an established pet grooming franchise such as Jim's Dog Wash will give you a recognisable brand and a clear structure to help get your business off the ground. Buying an existing franchise requires more money upfront. Instead of using your savings, you can use a business loan to cover the start-up costs.
Compare loans for a pet grooming franchise
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How does a pet grooming franchise work?
Pet grooming franchises come in two main types: the first is a fixed-location store outlet where pet owners bring their pets to you and the second is a mobile pet grooming solution where a hydrobath is driven to the clients' homes by appointment.
A mobile pet grooming franchise business may have relatively low entry costs compared to other franchises, offer flexible working hours and the lifestyle impact that comes with working outdoors and travelling to different people's homes. A fixed-location pet grooming franchise might be a better choice for those looking to run a more traditional business, as it operates from fixed premises and more regular working hours.
Like any other type of franchise, a pet grooming franchise gives potential business owners the opportunity to purchase and manage a business while benefitting from the brand awareness and infrastructure of an existing company.
As a potential franchisee, you can purchase a pet grooming business from the franchisor or another franchisee and are then responsible for the day-to-day running of the business. You pay an upfront franchise fee to purchase the franchise, as well as ongoing fees to cover marketing and operational support.
How much does a pet grooming franchise cost?
The initial costs of mobile pet grooming franchises vary from company to company, but in general the initial costs are considerably lower than for many other franchise systems, solely because there is no fixed location for the business, which drastically reduces business overheads.
The approximate cost of popular pet grooming franchises are as follows:
- Dash Dog Wash. A new Dash Dog Wash franchise can be established for as little as $10,000.
- Aussie Pooch Mobile. Aussie Pooch Mobile has initial startup costs between $15,000 and $40,900 for a variety of packages.
- Jim's Dog Wash. A Jim's Dog Wash franchise costs a minimum of $32,000 to establish.
- Blue Wheelers. Blue Wheelers is one of the more popular and well-known pet grooming franchise companies in Australia and has proportionally higher initial costs in line with the use of its highly-visible branded blue dog wash vehicle. The cost to start a new Blue Wheelers franchise is $24,950, which includes full training in business management as well as dog grooming and clipping.
Purchasing an existing franchise
Rather than building a new franchise from the ground up, franchisees can choose to purchase an established franchise. The advantage of an existing franchise is it already has a customer base and a financial history that can be useful when applying for finance.
Purchase prices for existing pet grooming franchises vary considerably, depending on location, client base and past performance. Example costs to purchase an existing pet grooming franchise are as follows:
- Blue Wheelers franchise in Wanneroo, Western Australia – $15,000.
- Blue Wheelers franchise in Marion, South Australia – $20,000.
- Aussie Pooch Mobile franchise in Wollongong, New South Wales – $27,000.
- Scally Wags franchise in Pakenham, Victoria – $35,000.
- Blue Wheelers franchise in Victoria point, Queensland – $39,500.
- Green Pause Grooming in Newcastle and Lake Macquarie, New South Wales – $65,000.
- Blue Wheelers franchise in Victoria Park, Western Australia – $75,000.
- Fleabag No More franchise in Castle Hill, New South Wales – $115,000.
Regardless of the industry or startup costs, an essential part of the franchise business structure is the ongoing management fees and royalties franchisees pay to the franchisor. Some franchises take a percentage of the gross revenue of individual franchisees, while others charge a flat ongoing fee, regardless of individual performance. This distinction applies even within the pet grooming franchise industry, with some companies taking a set weekly management fee and others taking a percentage of each franchisee's takings.
For example, Blue Wheelers charges a flat management fee of $175 per week regardless of the individual franchisee's income or performance. In addition, new client leads taken through the national call centre are charged to franchisees at $2.10 per lead.
As another example, Aussie Pet Mobile franchisees pay royalties between 4% and 8%, in addition to regular marketing fund contributions.
Franchisees must also consider petrol costs and costs related to ongoing vehicle upkeep which could be considerable since mobile pet grooming businesses are consistently on the road and operate from their vehicle.
While many franchisors are notoriously quiet about the potential earnings for franchisees, Blue Wheelers are upfront with its projected income for new franchisees, claiming franchisees can earn $1,200 per week and more than $2,500 per week for high-performing franchisees.
Pet Mobile has also offered an estimate for new franchisees, claiming many of its current franchisees bring in more than $100,000 gross per year.
Aussie Pooch Mobile, on the other hand, has not released a figure on the expected earnings for new franchisees, but claims it has never had a franchisee follow its franchise system without success.
Regardless, the pet industry in Australia continues to grow and is estimated to be a $6 billion market. In addition, almost 40% of Australian homes own at least one pet, with estimates claiming there are 4.2 million dogs in Australia. People who choose to enter into the pet industry in Australia will be in a stable, growing market that necessitates time and effort to make their business a success.
How to finance a pet grooming business franchise
You have a number of options when it comes to funding a pet grooming franchise, including:
- Unsecured business loan. An unsecured business loan is a loan offered to lenders who can meet specific eligibility criteria: typically they've been operating business for a specific period and brought in a minimum amount of revenue during that time. These loans are an alternative to secured business loans where a residential property is offered up as security against the loan amount. Unsecured business loan amounts and terms will vary from lender to lender, but will generally be between 3 months and 5 years, with loan amounts up to $500,000 – more than enough to finance a pet grooming franchise.
- Secured business loan. Under a secured business loan agreement, a lender will typically offer up to 80% of the loan amount for loans up to $1 million and up to 70% for loan amounts greater than $1 million. The loan terms will depend upon the applicant providing an appropriately-valued residential property as security for the loan. The lender will organise a professional valuation of the residential property at the applicant's expense and will use this assessment as the basis for its loan offer.
- Franchise loan. The amount of the franchise loan will hinge upon the value the lender places on the proposed franchise business itself. As such, the terms of a franchise loan can be more flexible than the traditional business loan, but franchise loans tend to only be offered for accredited, reputable franchise businesses.
- Franchise finance. The pet grooming industry is unique in that many franchise companies will offer finance options to assist new franchisees to finance their new franchise. For example, Aussie Pooch Mobile offers finance options to approved applicants with a range of solutions, including purchasing part of the franchise now and part later, or rent-to-buy plans.
Frequently asked questions
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