Patrick: This is Patrick Findaro, co-founder at Vetted Biz. Today I’m really excited to have on Jack Saumby, the founder and president of Mint Condition. As well as Randy Abernathy, the director of Master Franchise Development. We’re going to talk all about the commercial cleaning industry, the size of the market, the growth, and how Mint Condition is positioned in the commercial cleaning industry. We’ll be also going through how they have adapted to COVID and the pandemic, being on the front lines in the cleaning and sanitation business.
Jack, if you could just tell a little about yourself and how you got into this business. I understand it’s been 20-plus years. You’ve grown nearly 400 locations. I’m curious to see how you got into this space and helped build an empire here.
Jack: Well, thanks for having us today. First of all, I actually started in the janitorial cleaning industry as a standard commercial cleaning company, hiring hourly employees. I did that in the Houston, Texas market. And I became partners with a gentleman that had his own business but was struggling with the sales piece. So I came aboard as a minority partner in Houston. And when the recession hit, we decided to leave the Houston market, my family, and we moved to Charlotte, North Carolina, where I replicated what I had learned in the Houston market. We used hourly employees to clean buildings.
We built it up to one of the largest janitorial companies in the Charlotte market. With about 100 employees, we were ranked around eighth in the Charlotte market. That was the good news. The bad news was, we were turning over 240% of our employees every year or more.
Patrick: Wow, okay.
Jack: And it just became an operational nightmare. So I wanted to focus on getting into a business that was more centered on sales, and marketing, and developing people. That’s when I switched to the franchise model. And we started initially with the Charlotte market.
Patrick: That’s great. And, Randy, how did you enter the space and become associated with the Mint Condition brand?
Randy: Well, I have a different path to the cleaning industry. I started out as an industrial and organizational psychologist by training and worked for a couple of big consulting firms early in my career. Took a job with one of my clients and I was an officer of that company for about 10 years. When I left there, I was looking for a different opportunity and came across this industry. I liked the model, liked what it had to offer, and actually became a master franchise of a different system.
I owned and operated that for 11 years and had great success with it. And the small business politics in California got to the point where it just…it was different from what a Kentucky boy like me wanted to deal with. And so I stepped away and…
Patrick: I had a live stream earlier today with an attorney and, either you’re mega-mega rich or you’re poor and you’re living well. But if you’re middle class, upper-middle-class, it’s not so nice.
Randy: To me, the living was okay. It was the set of regulations that contradicted themselves. It’s just inconsistent.
Patrick: Frustration, though. That’s part of it. Yes, you’re getting by, but you’re dealing with all this bureaucracy and…
Randy: You shouldn’t have those kinds of obstacles to help people get employed. That’s why I sold that business, and the building. I also sold my house, loaded up the truck and moved to Tennessee, where I started working as a franchise broker. I ran into Jack at a conference and had a good conversation. We kind of continued to talk off and on about the different things he was doing and the things I was interested in because I liked his model.
Patrick: Great. I know a little about this industry, but not so much. I’ve probably used the wrong terminology but, what is the right term for this industry? What do the insiders say? Let’s talk a bit about the size, growth, and opportunities in this space.
Jack: Basically, it’s over a $100 billion industry. So the cleaning industry is enormous. What we have done is find our niche within the industry, and it’s really small to medium-size commercial accounts. But the pleasant part is that it’s very diverse. We’ll do office buildings and light manufacturing as well as churches, financial institutions. We do extremely well in the medical field. We have a very diverse commercial base that we’re going after. But what we stay away from is the really large buildings. The high rise, the really large industrial facilities, etc. We have found our niche and work very hard within that, in that marketplace.
Randy: Patrick, for a lot of the folks that I know who follow your podcast and look to you for advice, the first thing I would say to them is: this is not a cleaning business, okay? For the people that run this, you know, this is a master franchise opportunity, right? It’s split into two very distinct groups of folks. The master franchise candidates will never clean anything. They are not in the cleaning industry. They are in the franchise sales and business development business. Their job is to help other people start, own, run, and operate a janitorial company.
In this way, that distinction becomes important as you talk about this industry because, in the big picture, we work within the commercial cleaning sector, right? Our franchisees ultimately, what they do on a day-to-day basis, they clean buildings. But for an individual looking for a franchise investment, those investments exist at two levels: a master candidate and a unit franchisee. And those are very different populations and folks with different goals and priorities.
Patrick: Well said. And just in terms of the industry and commercial cleaning, I imagine you have some mom and pops. There are a lot of franchise systems. Randy, you mentioned you’re part of another group. Is there also a big corporation that’s doing commercial cleaning? How is this broken down? Who are the market players?
Jack: As far as the small mom-and-pop cleaning companies, they’ll typically go after really small buildings, one time a week or two times a week type of stuff. That’s kind of where their bread and butter is going to be. On the other side are extremely large national or international companies such as American Building Maintenance. You know, you go into the downtown areas of any metro and they’re cleaning the 20-story and 30-story office buildings, that sort of thing. That’s not who we’re going after. Then, our typical competitor is going to be janitorial companies that are more large within their local community, but mostly it’s going to be our franchise competitors. And that’s who we run into on a day-to-day basis.
Randy: You’ll see some regional competitors. In certain markets, you’ll see some unionized competitors that may be specific to that area. Then you’ll see the franchise companies like ourselves who compete in that space. But we’re looking at cleaning spaces between 3,000 and 50,000 square feet.
Patrick: Interesting. Then, someone that wants to be a master franchisee, I imagine they don’t need to have professional experience. It’s more about sales management skills?
Randy: We want them to have professional experience.
Randy: Right. I would argue they do because, remember, they’re not running a janitorial business. They’re doing business development. And they need experience with that, right? We need people that have been C-level executives, high-level directors, high-level execs with big corporations. People who have had P&L responsibility, who have run and managed large groups of people, who know how to coach and develop people. That’s the professional experience that we’re looking for. And we absolutely want that in our master candidates, as it’s critical for them to be successful.
Patrick: Jack, any items on that side?
Jack: No, I think he hit the nail on the head because we’re looking for people. Many people think they need to have strong sales backgrounds. That’s not necessarily the case. But what we’re really looking for is someone that actually wants to build a team and has the skill sets to do that effectively.
Patrick: And I imagine someone that has the skill set but doesn’t want to do everything along. Basically, the one also responsible for the guy cleaning day-to-day. If they want to go through the non-franchise route in this space, they would have to be doing everything.
Randy, you worked at another commercial cleaning franchise. You were a master franchisee at that brand. I haven’t seen so many industries that employ the master franchisee model in the United States. Usually, I’ve seen it abroad, or even doing joint ventures abroad, and exploring unique models. What is it about commercial cleaning and janitorial services that it’s more common to have? A master… the franchisor, the master franchisee, and then the franchisee at the bottom?
Randy: Much like you see other franchise companies in the U.S. operate, when they sell a master to somebody for a different country, they’re essentially licensing their brand and their process. They’re also licensing their systems and their materials to someone. To someone that’ll run it in a completely different location where it would be difficult for them to effectively service the individual unit franchisees from a different country.
We have over 400 unit franchisees right now in 12 different metro locations. Each of those metro locations has their own little idiosyncrasies, their own challenges, their own special market niches, their own populations of franchisees. To try to run that collectively as a nationwide effort would really not be feasible and wouldn’t be a good service to those unit franchisees. What we do is we license this opportunity to professionals who can duplicate that model for each of those locations.
Patrick: Makes sense. You explained it clearly. The local market knowledge where, if you’re just selling hamburgers, maybe it’s not that important. But if you’re dealing with business professionals in a certain market, it’s good to have that local expertise.
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