Mr. Rooter Plumbing Franchise in 2024: Costs, Fee & FDD
Considering investing in a plumbing franchise? Explore Mr. Rooter Plumbing, a trusted name since 1970, with over 200 locations across North America. Learn about startup costs, earnings potential, and franchise support in our detailed analysis.
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Mr. Rooter Plumbing, founded in 1970, has grown into a prominent name in the plumbing industry. The franchise was established with a focus on delivering top-notch plumbing services at fair prices. The original Mr. Rooter is still in operation in Oklahoma City, where it started, maintaining a deep connection with its local community. Over the years, Mr. Rooter has transformed into a large network of independently owned and operated franchises across the U.S. and Canada, all adhering to the same high standards of customer service and professionalism that the founders envisioned.
At its core, Mr. Rooter offers a wide range of plumbing services, including drain cleaning, pipe repairs, water heater installations, and emergency services. What sets them apart is their approach to customer care, ensuring transparent pricing and quality workmanship. Their primary customer base includes both homeowners and businesses, making them a go-to for residential and commercial plumbing needs. Mr. Rooter also offers ancillary services like maintenance programs, which keep customers’ systems running smoothly.
Today, Mr. Rooter boasts hundreds of franchise locations across North America, servicing millions of customers each year. Their reach extends across the U.S. and Canada, with each franchise rooted in its local community while benefiting from the larger support network. With such a wide footprint, Mr. Rooter is able to handle everything from small residential jobs to large-scale commercial projects, making them a key player in the plumbing industry.
One of the key strengths of the Mr. Rooter franchise system is its comprehensive support and training. Franchisees benefit from robust initial training, ongoing support, and access to cutting-edge technology that helps manage operations efficiently. From marketing to technical assistance, the franchise network ensures that each owner has the tools needed to succeed. Additionally, Mr. Rooter’s focus on community engagement and customer satisfaction makes it a trusted and reliable brand for both customers and franchisees alike.
Mr. Rooter Plumbing Franchise Insights
- Founded in 1970, Mr. Rooter has been a trusted name in plumbing for over 50 years, with a reputation for quality service and transparent pricing.
- The franchise has grown to over 200 locations across the U.S. and Canada, allowing franchisees to tap into a large, well-established customer base.
- With the plumbing industry expected to grow at a steady pace, Mr. Rooter franchisees can capitalize on the consistent need for residential and commercial plumbing services.
- The plumbing industry has a strong revenue potential, with many Mr. Rooter franchises generating annual revenues in the six-figure range, making it an attractive opportunity for those seeking a reliable investment.
- Mr. Rooter is part of the Neighborly franchise group, which includes over 30 home service brands, giving franchisees access to a larger network of cross-promotional opportunities and a solid reputation across various industries.
Mr. Rooter Plumbing Franchise Key indicators
Growth YOY (%)
3%
vs industry 4%
Total U.S. Franchised Units
215
3-Year Failure Rate
11%
vs industry 13%
Sales-to-Investment ratio
6.6:1
How much does it cost to open a Mr. Rooter Plumbing franchise?
Understanding the potential investment size and capital requirements is crucial when considering opening a Mr. Rooter Plumbing franchise. These financial commitments, including initial franchise fees, equipment costs, and ongoing operational expenses, impact the feasibility and profitability of the venture. Thoroughly evaluating these factors ensures that potential franchisees are prepared for the financial responsibilities and can make informed decisions about their ability to sustain and grow the business, ultimately contributing to long-term success.
Min & Max Investment
Opening a Mr. Rooter Plumbing franchise involves several key costs, which are outlined in Item 7 of the Franchise Disclosure Document (FDD). You can see a breakdown of the costs to open a Mr. Rooter Plumbing below from the most recent Item 7 below:
| Type of Expenditure | Minimum Investment | Maximum Investment |
|---|---|---|
| Initial Franchise Fee | $42,500 | $42,500 + $425 per 1,000 additional population over minimum |
| Software System Enrollment Fee | $1,250 | $1,250 |
| Vehicle | $20,220 | $69,300 |
| Equipment, Supplies & Inventory | $25,000 | $40,000 |
| Insurance | $1,000 | $4,200 |
| Advertising & Promotional and Local Marketing | $7,500 | $25,000 |
| Training, Travel, Lodging & Food | $3,100 | $7,550 |
| Deposits, Permits & Licenses | $350 | $4,000 |
| Professional Fees | $1,500 | $8,000 |
| ServiceTitan Software | $383 | $2,000 |
| Real Estate | $4,500 | $20,000 |
| Additional Funds – 3 Mo. | $15,000 | $40,000 |
| Totals | $122,303 | $263,800 + any additional franchise fee + any real estate costs |
Item 7 in the Franchise Disclosure Document (FDD) is the “Estimated Initial Investment” section. It outlines the total costs a franchisee can expect to incur when starting a franchise, including the initial franchise fee, equipment, inventory, real estate, and other startup expenses. This section is crucial because it provides potential franchisees with a detailed understanding of the financial commitment required, helping them assess affordability and plan their investment strategy effectively.
Required Capital
When considering opening a Mr. Rooter Plumbing franchise or a similar business in the home services industry, it’s essential to understand the financial requirements. Based on the total investment range, here’s a breakdown of typical capital, liquid assets, and net worth requirements:
- Total Investment The estimated total investment required to open a Mr. Rooter Plumbing franchise ranges from $122,000 to $264,000, which includes costs such as equipment, initial inventory, and real estate or leasing expenses. Assuming that you will finance your franchise investment, you should plan to have 20% of the total investment amount in the form of equity (cash) for the investment.
- Required Liquid Assets You’ll typically need around $75,000 to $100,000 in liquid assets, which ensures you have enough cash on hand to cover operational expenses, such as payroll and initial marketing efforts, during the early months of your business.
- Net Worth Requirement Most franchises in this category expect potential franchisees to have a minimum net worth of $150,000 to $300,000, depending on the size and location of the business. This demonstrates your overall financial stability and ability to sustain the business.
How much does a Mr. Rooter Plumbing franchise owner make?
Calculating the salary of a Mr. Rooter Plumbing franchise owner involves analyzing gross sales to determine total revenue, assessing operational efficiency to understand profit margins, and accounting for franchisor fees and additional expenses such as rent, utilities, and payroll. Effective management of these factors can significantly impact the profitability and financial success of a Mr. Rooter Plumbing franchise owner. This comprehensive financial analysis helps estimate net profits, from which the owner’s salary can be derived. A clear understanding of these factors ensures accurate salary projections and financial planning for sustainable business operations.
Mr. Rooter Plumbing Revenue & Gross Sales
Mr. Rooter Plumbing has demonstrated strong revenue performance, with median gross sales reaching $1,276,237. This figure reflects the robust demand for plumbing services and the franchise’s established market presence. Franchisees benefit from high customer retention and consistent job orders, contributing to steady revenue streams.
Which key factors impact the average revenue performance of Mr. Rooter Plumbing franchisees?
Several factors likely contributed to the strong performance of U.S. Mr. Rooter franchisees in terms of median gross sales. First, the consistent demand for plumbing services, which are essential in both residential and commercial markets, ensures a steady flow of business. Additionally, the franchise’s reputation for providing reliable and professional service has helped build trust and loyalty with customers, leading to repeat business and referrals. The support structure provided by the Neighborly network, offering marketing resources, operational guidance, and access to cutting-edge technology, also plays a crucial role in boosting franchisee success. Finally, Mr. Rooter’s commitment to transparent pricing and quality workmanship helps differentiate it from competitors, further driving sales growth.
Mr. Rooter Plumbing Franchise Operational Costs
When opening a Mr. Rooter Plumbing franchise, it’s important to plan for the primary ongoing operational costs that directly impact your day-to-day business. These costs are critical to maintaining smooth operations and providing high-quality services to your customers. Below are the key costs you should consider:
- Employee Wages As a service-based business, paying competitive wages for plumbers, administrative staff, and possibly sales personnel is essential to retaining top talent.
- Vehicle and Maintenance Costs Your plumbing business will likely require a fleet of service vehicles, and maintaining these vehicles—fuel, repairs, and insurance—will be a consistent expense.
- Supplies and Equipment Plumbing tools, parts, and other supplies will be needed for daily operations. Regularly replenishing these materials is crucial to keeping up with customer demands.
- Marketing and Local Advertising While Neighborly offers marketing support, ongoing local advertising efforts, such as SEO, community events, and targeted campaigns, will require a dedicated budget.
By carefully managing these costs, you’ll position your franchise for long-term success while maintaining service quality and profitability.
Mr. Rooter Plumbing Franchise Fees
When opening a Mr. Rooter Plumbing franchise, understanding the ongoing fees is critical to budgeting effectively and ensuring the long-term profitability of your business. These fees cover essential services that help drive the franchise’s success, from operational support to marketing initiatives. Below are the key fees you should consider:
- License Fee You’ll be required to pay a 6% fee on your gross sales as part of the franchise’s licensing agreement. This fee grants you access to the brand’s name, reputation, and operational support, with a minimum fee applied to ensure franchise standards.
- MAP Fee (Marketing, Advertising, Promotion) A 2% fee on gross sales goes towards the brand’s marketing, advertising, and promotional efforts. This contribution helps keep the Mr. Rooter brand visible and competitive in the market, with additional minimum fees ensuring consistent regional and national presence.
- Additional Fees There may be extra fees for participating in specialized training programs, access to proprietary technology, and other services provided by Mr. Rooter Plumbing.
By understanding these fees and incorporating them into your financial planning, you’ll ensure that you’re maximizing the benefits of being part of a trusted and well-supported franchise network.
Mr. Rooter Plumbing Franchise Earnings
The earnings of a Mr. Rooter Plumbing franchise owner can vary depending on factors such as location, customer demand, and how effectively the business is managed. For owner-operators, being actively involved in day-to-day operations often leads to higher profitability. Based on the most recent data, the median gross sales for a Mr. Rooter Plumbing franchise are approximately $1,276,237.
For an owner-operator, the estimated earnings come in at around $191,000, reflecting an operating profit margin of 15%. This indicates that with hands-on management, franchisees can see significant returns. These figures underscore the earning potential for a well-run Mr. Rooter franchise, especially when the owner is actively engaged in overseeing operations and optimizing efficiency.
How to Open a Mr. Rooter Plumbing Franchise
Becoming a Mr. Rooter Plumbing franchisee involves a structured process that ensures you’re well-prepared to launch and operate your business successfully. From the initial inquiry to the start of operations, each step is designed to guide you through key decisions and preparations. Here’s a general overview of the process:
- Initial Inquiry You or your franchise specialist submits an initial inquiry basic information about your interest and background. You should also conduct thorough research on the franchise, including seeing all of the information available on the Vetted Biz franchise intelligence platform, including access to the most recent Franchise Disclosure Document (FDD).
- Franchise Application Complete and submit the formal franchise application. This includes personal and financial information to assess your qualifications as a potential franchisee.
- Review of Financials The franchisor will review your financial status, ensuring you meet the capital, net worth, and liquid asset requirements to move forward.
- Discovery Day Attend a Discovery Day at Mr. Rooter’s headquarters to meet the leadership team, learn more about the company culture, and ask any final questions before proceeding.
- Franchise Agreement Once you’re confident in your decision, you’ll sign the franchise agreement and pay the necessary initial fees to officially join the franchise.
- Training Program Participate in a comprehensive training program covering operations, customer service, and marketing strategies to prepare you for running your business.
- Location Setup Work with the Mr. Rooter team to secure and set up your territory or office space, purchase equipment, and hire staff.
- Launch and Opening Once your setup is complete, you’ll be ready to officially open your Mr. Rooter Plumbing franchise and begin operations, with continued support from the franchisor.
Pros & Cons
Pros
Established Brand Reputation: Mr. Rooter is part of the Neighborly network, giving you instant credibility and access to a well-recognized name in the home services industry.
Essential Services: Plumbing is a necessity, meaning consistent demand for your services regardless of economic conditions.
Strong Revenue Potential: With median gross sales exceeding $1.2 million, owner-operators can achieve significant earnings, especially with efficient management.
Large Territory Opportunities: Mr. Rooter often provides franchisees with extensive, exclusive territories, allowing for growth and scalability.
Cons
Dependence on Skilled Labor: Success depends heavily on hiring and retaining qualified plumbers, which can be challenging in a competitive job market.
Local Competition: While the brand has a national presence, competition from local or independent plumbers may impact your market share in certain areas.
Seasonal Fluctuations: Although plumbing is essential year-round, certain regions may experience seasonal fluctuations in demand, such as fewer service calls during milder months.
