Ductz sweeps into carpet, upholstery cleaning

Date AddedMarch 24, 2010 02:38:28 AM

Author

President and Founder John Rotche expects the new Total Care carpet and upholstery cleaning service line, the popularity of the company's

recently launched Hoodz commercial hood-cleaning franchises, and large, national duct-cleaning projects to increase the company's revenue to between $25 million and $30 million this year, up from $17 million in 2009.

In franchising, diversification is key, said Rotche.

It's the role and obligation of the franchisor to ensure the success of your franchisees by providing them with opportunities to increase their revenue.

The company's new Hoodz franchise is everything we hoped it would be and 10 times more, Rotche said.

Since last May, when it launched the commercial hood-cleaning business, Ductz has sold 69 Hoodz franchises, and it expects to award another eight this month.

We looked at Hoodz as repeat work to allow franchisees to increase their revenue, Rotche said. But ? it's taken on a life of its own.

After initially offering Hoodz franchises to its Ductz franchisees, the Ann Arbor-based company opened them up to everyone.

Overnight, Hoodz has become the nation's largest kitchen exhaust-cleaning company and one of the fastest-growing franchisees in America, serving major restaurant chains across the U.S., Rotche said.

Rotche and the company see the same opportunity with carpet and upholstery cleaning.

Ductz plans to roll out the new Total Care line in March so it can improve indoor air quality from the ground up, Rotche said.

Historically, we've grown our business as B-to-B - we'd network with contractors and get referrals, he said.

Now, to increase its brand recognition with consumers, Ductz plans to launch a $250,000 television, radio and print advertising campaign.

Less than a year after launching a commercial hood-cleaning business, Ductz International L.L.C. is entering the residential carpet and upholstery market.

President and Founder John Rotche expects the new Total Care carpet and upholstery cleaning service line, the popularity of the company's

recently launched Hoodz commercial hood-cleaning franchises, and large, national duct-cleaning projects to increase the company's revenue to between $25 million and $30 million this year, up from $17 million in 2009.

In franchising, diversification is key, said Rotche.

It's the role and obligation of the franchisor to ensure the success of your franchisees ? by providing them with opportunities to increase their revenue.

The company's new Hoodz franchise is everything we hoped it would be and 10 times more, Rotche said.

Since last May, when it launched the commercial hood-cleaning business, Ductz has sold 69 Hoodz franchises, and it expects to award another eight this month.

We looked at Hoodz as repeat work to allow franchisees to increase their revenue, Rotche said. But ? it's taken on a life of its own.

After initially offering Hoodz franchises to its Ductz franchisees, the Ann Arbor-based company opened them up to everyone.

Overnight, Hoodz has become the nation's largest kitchen exhaust-cleaning company and one of the fastest-growing franchisees in America, serving major restaurant chains across the U.S., Rotche said.

Rotche and the company see the same opportunity with carpet and upholstery cleaning.

Ductz plans to roll out the new Total Care line in March so it can improve indoor air quality from the ground up, Rotche said.

Historically, we've grown our business as B-to-B - we'd network with contractors and get referrals, he said.

Now, to increase its brand recognition with consumers, Ductz plans to launch a $250,000 television, radio and print advertising campaign.

Rotche said he expects Total Care to do $4.5 million in consumer sales after its launch, based on conservative estimates that about half of Ductz franchisees will offer the new service. Ductz International will receive a royalty from every cleaning done.

What's great for the franchisees is there is a very strong repeat business, and it's going to allow them even more contacts with homeowners to really share our (indoor air quality) expertise, Rotche said.

Like Ductz with its decision to enter the carpet and upholstery cleaning business, Troy-based Modernistic also was responding to customer requests when it began offering duct cleaning to residential customers three months ago.

Since Modernistic launched the business in October, we're very busy with it, said Bob McDonald, president, who has been in carpet and upholstery cleaning for over 35 years.

Because we serve so many customers every day - 2,000 in metro Detroit a month and 5,000 across the state - it's just a natural if we talk to these customers and ask if they've had their ducts cleaned.

Modernistic closed 2009 almost flat at $6.5 million in revenue, McDonald said.

He's projecting the company's duct-cleaning business - which he says will never be core like its carpet and upholstery business - will bring in about $300,000 in the first year.

That's 5 percent of our sales. It's not much, but it's growth, he said. Carpet-upholstery and duct cleaning both go hand in hand as far as indoor air quality.

Since its early days, Ductz has relied on large projects across the country to help buoy its franchisees' revenue during periods of low revenue in local markets.

Its management teams fly in to evaluate the projects and then staffs them with franchisees from across the country.

In January, Ductz and its franchisees worked on four major projects: one of the Hershey buildings in Pennsylvania, a Santa Barbara courthouse, a city transit building in Milwaukee and the Coleman A. Young Municipal Center in Detroit.

In March, Ductz will begin another major cleaning project at the National Aeronautics and Space Administration campus in Cape Canaveral, Fla., Rotche said.

Last year, the Ductz's National Service Team projects brought in about $3 million of its $17 million in revenue, he said.

Even Ductz's namesake brand has continued to grow.

Last year, it sold 40 new Ductz franchises, giving it 178 territories across the country, said Rotche.

Ductz recently purchased its Ann Arbor headquarters building for an undisclosed amount to continue our investment into the franchise space, Rotche said.

It plans early this year to invest up to $500,000 to build a commercial kitchen at its headquarters that will be used to not only to feed its trainees who travel to Ann Arbor from around the country but also to train its new Hoodz franchisees.

By SHERRI WELCH
Publication: Crain's Detroit Business

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