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CertaPro Painters Review For 2023

Written by: Collins Kibet
Last Updated by Rocío Torres: January 18, 2023
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This article is based on a video originally recorded on Visa Franchise YouTube channel.

CertaPro Painters offers a full range of professional interior and exterior painting and decorating services, year-round, throughout North America. Their services range from residential to commercial painting, which is handled with great care by highly skilled and experienced professionals. Michael Stone is the current CEO and president of the company and has served in the role since 2015. He has been with CertaPro since 2003 and has previously served as Regional Vice President from 2007 and as Vice President of Operations from 2013.

CertaPro was incorporated in Massachusetts on December 18, 1991 and its parent company is FS Brands, Inc. (formerly TFC Brands, Inc.). CertraPro does business under the name CERTAPRO and CERTAPRO PAINTERS.

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CertaPro Painters

In 1971, Cameron Greig Clark and his partner, Stewart, found Stewart & Clark Painting in Thunder Bay, Ontario, Canada. In 1972, they changed the name of this company to College Pro Painters and in August of 1975, incorporated as College Pro Painters Limited in Ontario, Canada. College Pro Painters Limited expanded into the United States and formed a subsidiary, College Pro Painters (U.S.) Ltd. (“College Pro”), In 1978. At that time, College Pro’s operations were seasonal and generally limited to offering exterior painting services for single family homes and small residential buildings.

All franchises and company-owned outlets were run entirely by college students or college age individuals with assistance from College Pro. In 1991 College Pro decided to expand its operations and formed CertaPro to offer a full range of interior and exterior painting and decorating services, year-round, throughout the United States.

painter

CertaPro Painters Franchise Cost

The total investment necessary to begin operation of a CertaPro Painters Franchise varies depending upon whether you use subcontractors or employee painters in your business.

With subcontractors performing the painting services, the total investment necessary to begin operation ranges from $147,750 to $175,000 while with employees, the initial investment will range from $169,800 to $221,000.

This cost includes:

CertaPro Franchise Cost Breakdown

Below is a breakdown of the estimated initial investment depending upon whether you choose to have your painters as subcontractors or employees.

Subcontractor Painter Model

Type of expeditureAmountMethod of paymentWhen dueTo whom payment is to be made
Initial Franchise Fee$57,500Lump sum or as
arranged
At the time you sign the Franchise AgreementCertaPro
Advertising &
Marketing
$40,000As incurredWithin the first 3
months of
commencing
operations
Suppliers
Commercial
Services Fee
$10,000Lump sumWhen you
sign the Franchise
Agreement, unless
you purchase an
existing CertaPro
business and the
Commercial
Services Licenses
will be transferred
to you
CertaPro
Miscellaneous
Opening Costs
$2,000 to $3,000As incurredBefore openingSuppliers, utilities,
EPA RRP Rule,
OSHA 10 online
training, training, etc
Equipment$1,000 to $3,000Lump SumBefore openingSuppliers
Office Equipment$500 to $4,000As incurredBefore openingSuppliers
Vehicle$2,500 to $4,000Lump SumBefore openingSuppliers
Contractor License$250 to $2,500As incurredBefore openingState/Local
Administrators;
attorney’s fees.
Computer System
and Proprietary
Software Solution
$9,000 to $11,500Lump SumBefore trainingCertaPro and
Suppliers
Travel and Living
Expenses While
Training
$500 to $3,000As incurredDuring training
and Forum
Program
Airlines, hotels, and
restaurants
Insurance$5,000 to $7,500 (Note 7)(Note 7)(Note 7)(Note 7)
Real Estate and
Improvements
(Note 8)(Note 8)(Note 8)(Note 8)
Additional Funds
(3-6 months of
operation)
$19,500 to
$29,500
As incurredAs incurredEmployees,
suppliers, utilities
TOTAL$147,750 to $175,500

Note 7: “…You should consult with a business insurance broker for an estimate of the cost of obtaining this insurance before you sign the Franchise Agreement.”

Note 8: “…Initially, franchisees operate their franchises from their homes, although if you reside outside your Territory or have staff. We recommend that you rent a small office within your Territory as soon as possible.”

Employee Painter Model

Type of expeditureAmountMethod of paymentWhen dueTo whom payment is to be made
Initial Franchise Fee$57,500Lump sum or as
arranged
At the time you sign the Franchise AgreementCertaPro
Advertising &
Marketing
$40,000As incurredWithin the first 3
months of
commencing
operations
Suppliers
Commercial
Services Fee
$10,000Lump sumWhen you
sign the Franchise
Agreement, unless
you purchase an
existing CertaPro
business and the
Commercial
Services Licenses
will be transferred
to you
CertaPro
Miscellaneous
Opening Costs
$2,000 to $3,000As incurredBefore openingSuppliers, utilities,
EPA RRP Rule,
OSHA 10 online
training, training, etc
Equipment$5,000 to $15,000Lump SumBefore openingSuppliers
Office Equipment$500 to $4,000As incurredBefore openingSuppliers
Vehicle$7,500 to $12,000Lump SumBefore openingSuppliers
Contractor License$3,000 to $7,500As incurredBefore openingState/Local
Administrators;
attorney’s fees.
Computer System
and Proprietary
Software Solution
$9,000 to $11,500Lump SumBefore trainingCertaPro and
Suppliers
Travel and Living
Expenses While
Training
$500 to $3,000As incurredDuring training
and Forum
Program
Airlines, hotels, and
restaurants
Insurance$7,500 to $12,500 (Note 7)(Note 7)(Note 7)(Note 7)
Real Estate and
Improvements
$4,800 to $7,000 (Note 8)(Note 8)(Note 8)(Note 8)
Additional Funds
(3-6 months of
operation)
$22,500 to
$35,000
As incurredAs incurredEmployees,
suppliers, utilities
TOTAL$169,800 to $221,000

Note 7: “…You should consult with a business insurance broker for an estimate of the cost of obtaining this insurance before you sign the Franchise Agreement.”

Note 8: “We recommend that you rent a small office within your Territory as soon as possible.”

If you use subcontractors as your painters, you will most likely incur less cost because they usually have the necessary equipment. Franchises using the employee model will incur more costs because they will need to purchase the painting equipment.

CertaPro’s On-going cost and fees 

Royalty Fees: 5% of Gross Sales.

Advertising Fees and Expenses: 12% of Gross Sales during 1st of operation and 8%of Gross Sales after 1st year of operation.

Technology Fees: 0.25% of Gross Sales.

How Much Do CertaPro’s Owners Make?

CertaPro Painters Franchise Sales Figures

AVERAGE REVENUE FOR FRANCHISEES
IN PRODUCTION FOR 12 AND 24 MONTHS

Production Year TwoTop 1/3Mid 1/3Bottom 1/3Total
Average Revenue $$875,724$545,547$396,492$605,907
% at/above average33.3%33.3%66.7%33.3%
# at/above average1123
Number of Participants3339
Median Revenue $$680,313$535,724$385,575$535,724
Production Year OneTop 1/3Mid 1/3Bottom 1/3Total
Average Revenue $$1,078,226$419,446$396,492$605,907
% at/above average25.0%50.0%66.7%33.3%
# at/above average1245
Number of Participants45514
Median Revenue $$853,144$405,834$258,578$376,636

The tables above show revenues of franchises in their first and second years of operation as of December 31, 2020. Revenue is defined as all gross sales generated under the franchise agreement, as reported by the franchises to CertaPro. The total median revenue for these franchises increased from $376,636 in year one to $535,724 in year two.

As of December 31, 2020, there were 307 franchisees that were in production for more than two full years. The average gross sales for these 307 businesses was $1,525,256 with 95 of them at or above the average. The median gross sales was $1,069,414.

For that, given the 2020 median gross sales, the table below shows you how long it will take you to recoup your investment for both the subcontractor and the employee business models with a 10%, 15%, or 20% profit margin. We will use the midpoint of the range of the total investment in the calculation.

Subcontractor Model

Initial investment (midpoint)% Profit Margin of Median Gross SalesEstimated ProfitsTime to recoup your investment
$161,62510%$106,941.403 years
$161,62515%$160,412.12 years
$161,62520%$213, 8821.5 years
 

paint

Employee Model

Initial investment (midpoint) % Profit Margin of Median Gross Sales Estimated Profits Time to recoup your investment
$195,400 10% $106,941.40 3 years
$195,400 15% $160,412.1 2.5 years
$195,400 20% $213, 882 2 years

FS Brands, Inc.  Income statements for 2020, 2019, and 2018.

Consolidated Statements of Income and Comprehensive Income

2020 2019 2018
Revenue
Royalties 70,476,363 70,908,765 65,536,712
Franchise fees 4,153,582 4,794,246 4,384,939
Merchandise sales 286,162,253 318,557,953 312,088,350
Services and other 58,149,261 73,034,131 66,565,223
418,941,459 467,295,095 448,575,224
Costs and expenses
Franchise operating 21,657,219 26,894,438 23,428,354
Cost of merchandise sales 200,653,290 224,199,103 205,577,393
Cost of services 5,167,179 11,070,226 17,210,968
General and administrative 125,729,239 137,073,029 126,288,939
Management fees to parent 4,430,219 4,884,590 9,190,670
Depreciation and amortization 20,801,420 18,824,462 15,129,595
378,438,566 422,945,848 396,826,465
Income from operations 40,502,893 44,349,247 51,748,759
Other income (expense)
Interest income 571,979 137,100 150,252
Interest expense (471,761) (1,009,817)
571,979 (334,661) (859,565)
Income before income taxes 41,074,872 44,014,586 50,889,194
Provision for income taxes 11,005,369 11,218,325 13,133,228
Net income for the year 30,069,503 32,796,261 37,755,966
Non-controlling interests share of earnings (1,526,754) (2,886,840) (5,190,435)
Non-controlling interests redemption increment (2,570,391) 2,085,931 (2,553,813)
Net income and comprehensive income attributable to common stockholders for the year 25,972,358 31,995,352 30,011,718

FS Brands, Inc. Income statement key insights

FS Brands, Inc. is the parent company of CertaPro Painters, Ltd. In 2020, the company had a net income of $25, 972, 358. This was a drop of about $5 million from the previous two years where the company had a net income of $31,995,352 in 2019 and $30,011, 718 in 2018. The revenue generated in 2020 was $418, 941, 459 while the expenses for that year were $378, 438, 566. This produced a substantial income from operations of $40,502,893 which indicates a high return on investment.

FS Brands, Inc. Cash Flow Statements of 2020, 2019, and 2018

Consolidated Statements of Cash Flows (Expressed in US dollars)

2020 2019 2018
Cash provided by (used in)
Operating avtivities
Net income for the year 30,069,503 32,796,261 37,755,966
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation of property and equipment 14,851,981 13,083,035 9,879,944
Amortization of intangible assets 5,949,439 5,741,427 5,249,651
Deffered income taxes 722,653 345,617 740,637
Change in non-cash working capital 25,173,976 (5,399,029) (26,687,515)
76,767,552 46,567,311 26,938,683
Investing activities
Purchase of property and equipment (11,681,756) (17,640,339) (15,612,614)
Acquisition of businesses (21,800) (8,063,000) (34,936,381)
Purchase on intangible assets (169,143) (3,633,118)
Sale of subsidiary to related company under common control 21,405,412
(11,703,556) (4,467,070) (54,182,113)
Financing activities
Advance from ultimate parent (21,760,271) (14,726,250)
Advance from parent 3,466,199 6,713,166 33,288,429
Advance (payment) of notes payable (1,308,622) (1,169,547) 1,124,449
Purchase of non-controlling interest (2,128,811) 737,172 (4,563,936)
Sales of shares to non-controlling interests (1,001,156) 1,200,000
Payment of dividends to non-controlling interests (1,619,722) (3,117,007)
Payments of obligations under capital lease (115,216)
(1,619,956) (19,926,606) 13,050,469
Increase in cash and cash equivalents during the year 63,401,040 22,173,635 (14,192,961)
Cash and cash equivalents – Beginning of year 31,653,532 9,479,897 23,672,858
Cash and cash equivalents – End of year 95,054,572 31,653,532 9,479,897
Supplementary information 
Cash paid for interest and dividends 820,861 984,653
Cash paid for income taxes 11,755,401 11,560,625 17,373,862

FS Brands Inc. Cash Flow Statement Key Insights

At the end of 2020, FS Brands had cash and cash equivalents of $95 million which was over 100%  of what they had at the beginning of the year. In 2019, their cash and cash equivalents increased by over $20 million from having about $9 million at the beginning of the year to having about $31 million at the end of the year. However, in 2018, the cash and cash equivalents dropped from $23.6 million at the beginning of the year to $9.4 million at the end of the year.

painters

How many franchise units have opened and closed?

Outlet type Year Outlets at start of year Outlets at end of year Net change
Franchised 2018 333 333 0
2019 333 340 +7
2020 340 342 +2
Company-Owned 2018 0 0 0
2019 0 0 0
2020 0 0 0
Total Outlets 2018 333 333 0
2019 333 340 +7
2020 340 342 +2

The number of franchise units has increased from 333 in 2018 to 340 in 2020 with 7 new outlets in 2019. There’s no record of closed outlets from 2018 to 2020.

Is it worth investing in CertaPro Painters Franchise?

Based on their sales, CertaPro Painters, Ltd. is a profitable business with high profit margins that guarantee a quick return on your investment.  

“In order to assess the performance of your franchise, CertaPro Painters recommend tracking the following measurements: Success Ratio, Average job size, and Percentage of leads from previous customers and through word of mouth.”

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