Mr. Rooter Plumbing franchise
A franchisee operates a Mr. Rooter plumbing business in a defined territory, providing residential and commercial plumbing repair, drain and sewer cleaning, water heater and pipe replacement, septic and grease-trap pumping, leak detection and related services.
Owner-operator required Disclosed
- Source
- 2026 Franchise Disclosure Document — Mr. Rooter SPV LLC
- Document
- FDD 2026, issued 2026-04-02
- Item
- Item 15
- Page
- PDF p. 82
- Obtained
- Wisconsin Department of Financial Institutions — Franchise Registration Search, file 640790
you must directly perform or supervise the operation of the Business unless we consent otherwise
An individual franchisee must directly perform or supervise the operation of the business unless the franchisor consents otherwise; where the franchisee is an entity, on-site supervision must be provided by a designated principal owner who has completed training. Only with the franchisor's agreement may a trained, bona fide manager supervise instead, and that manager need not hold equity. Private-equity owners may use a managing principal with no ownership interest. Principal owners of an entity franchisee must sign a personal guaranty, and where the franchisor provides financing it may require a spouse's guaranty.
What stands out
- Estimated initial investment of $152,900 to $298,675 for a standard territory, excluding real estate; initial franchise fee $42,500 for up to 100,000 population, plus $425 per additional 1,000 population.
- Ongoing fees: 6% License Fee and 2% MAP fee on weekly Gross Sales, with weekly minimums of $100 to $1,400 payable regardless of sales, plus technology, ServiceTitan and mandatory call-centre charges.
- Required local marketing spending is large and separate from the MAP fee: $60,000 in months 1-12, $75,000 in months 13-24, then the greater of $50,000 or 8% of prior-year Gross Sales if imposed.
4 more observations
- Item 19 reports 2025 Gross Sales only for 193 of 238 U.S. franchised outlets: average $2,093,531, median $1,257,146, range $633 to $20,262,638, with 33% at or above the average. No cost or profit data is disclosed.
- Franchised outlets grew from 209 to 238 across 2023-2025, but franchised departures rose from 5 to 9 to 13 a year, with 11 terminations in 2025; transfers averaged about 14 a year.
- The territory is not exclusive, and keeping it requires ranking in the top 90% of the system by Gross Sales and staying within 10 points of the average Net Promoter Score from the second full year.
- One 10-year initial term with a single 10-year renewal; entity owners must personally guarantee, disputes are venued in McLennan County, Texas, and a two-year, 25-mile post-term non-compete applies.
Things to verify
- Ask how the $42,500 fee scales for the territory actually offered: Item 5 says fees paid in 2025 averaged about $81,424 and ranged from $39,101 to $320,073.
- Model the weekly minimum License Fee and the $60,000/$75,000 initial marketing spend against a realistic ramp-up, since both are due whatever the sales level.
- Item 19 discloses no costs or profit. Ask existing franchisees about labour, vehicle, insurance and marketing costs, and about what the bottom-half units (averaging $614,354) look like operationally.
4 more questions
- Understand why 11 franchise agreements were terminated in 2025 and speak with franchisees listed in Exhibit F who left the system; note that some may be bound by confidentiality provisions.
- Clarify the Minimum Performance Standards: being in the bottom 10% of the system by Gross Sales in any year triggers a performance improvement plan and can put the territory or franchise at risk.
- Check how Key Accounts, the Preferred Lead Program and the call-centre requirement affect who can serve customers inside the territory and at what fee.
- Confirm whether a manager will be permitted in place of owner supervision, since Item 15 makes that dependent on the franchisor's consent.
Category cost placeholders, not a forecast. Owner operation is required; a manager-pay deduction does not make this an absentee model. This snapshot uses the default inputs; the calculator below updates when you edit them.
Evidence confidence: High. This describes source support, not investment quality. AI-extracted and machine-verified where stated; no human line-by-line review. Source and review record.
Read the full research overview
A Mr. Rooter franchisee runs a plumbing and drain business in a population-defined territory, handling residential and commercial plumbing repair, sewer and drain cleaning, water heater and pipe replacement, septic and grease-trap pumping, leak detection and related work. The business can be run from home where zoning allows, so the model is vehicle-and-technician led rather than site led. The franchisor, Mr. Rooter SPV LLC of Waco, Texas, is part of the Neighborly group and is ultimately controlled by investment funds affiliated with KKR; the concept has been franchised since 1993.
Item 7 puts the estimated initial investment for a standard franchise with the minimum 100,000-population territory at $152,900 to $298,675, excluding any real-estate purchase and assuming three months of additional funds. The initial franchise fee is $42,500, with extra territory priced at $425 per 1,000 population and several discount programs available; a $1,250 software enrolment fee is also due at signing. Continuing fees are a 6% weekly License Fee and a 2% MAP fee on Gross Sales, subject to weekly minimums of $100 to $1,400 that apply regardless of sales, plus $176.45 a month for the technology package, separate ServiceTitan user fees, mandatory call-centre fees and required local marketing spending of $60,000 in year one and $75,000 in year two.
Item 19 does contain a financial performance representation, but it reports revenue only. For calendar 2025, 193 U.S. franchised businesses open at least 12 months and reporting all 52 weeks averaged $2,093,531 in Gross Sales with a median of $1,257,146; only 33% reached the average. The spread is very wide, from $633 to $20,262,638, and the bottom half averaged $614,354. No costs, margins or profit figures are disclosed, franchisee-reported data is not required to follow GAAP, and 45 outlets (newly opened, transferred, non-reporting or closed during the year) are excluded.
Item 20 shows franchised outlets rising from 209 to 238 over 2023-2025, a net gain of 29. Openings rose from 11 to 22 to 23, but departures rose faster, from 5 in 2023 to 9 in 2024 and 13 in 2025, of which 11 were terminations. Transfers to new owners ran 10, 16 and 15. Sixteen signed agreements were not yet open at year end and 18 new franchised openings are projected for the next year. On the legal record, Item 3 lists four matters — two older settled cases, one collection suit the franchisor filed against a franchisee in 2025, and an administrative consent order involving an affiliated brand's predecessor — and Item 4 discloses six insolvencies among KKR portfolio companies, none involving the franchisor. Buyers should also weigh the non-exclusive territory, the minimum performance standards tied to system-relative sales and customer scores, Texas venue for disputes, and the personal (and potentially spousal) guaranty. No minimum liquidity or net-worth requirement is disclosed in the reviewed source.
View ratings and their supporting evidence
Transparent ratings
How these are computedEach dimension is scored 1–5 from published formulas. Missing data yields “Not enough evidence to rate”, never a low score. There is no composite score by design.
How the system has performed, computed from the disclosed Items 7, 19 and 20. Figures a documented material source inconsistency puts in doubt are excluded, and the dimension shows “Not rated”.
Inputs
- Franchised outlets 209 → 238 (Item 20, Table 3)
- Thresholds: ≥15% → 5; 5–15% → 4; 0–5% → 3; −5–0% → 2; below −5% → 1
Inputs
- Attrition = (terminations + non-renewals + reacquisitions + ceased-other) ÷ start-of-year franchised units, averaged over 3 fiscal years
- Thresholds: <2% → 5; 2–4% → 4; 4–6% → 3; 6–10% → 2; >10% → 1
Inputs
- AUV $2,093,531 (disclosed) ÷ midpoint investment $225,788 = 9.27×
- Thresholds: ≥2.0 → 5; 1.5–2.0 → 4; 1.0–1.5 → 3; 0.7–1.0 → 2; <0.7 → 1
How much this brand’s FDD discloses, and how well-supported our data on it is. This measures transparency, not business performance — a strong business that discloses little scores low here and stays unrated above.
Inputs
- Item 19 present (+1)
- Average plus median or a distribution (+1)
- Population 81% of franchised units, clearly described (+1)
- Franchisor Track Record
- Franchising 33 years (since 1993) · 240 outlets · Item 3: 4 matter(s) disclosed · Item 4: bankruptcy disclosure present
- Multi-Unit Scalability
- There is no general right to additional units. An existing franchisee may be permitted to open another Mr. Rooter business only if it meets the franchisor's … · Owner-operator required
- Operational Intensity
- Owner-operator required
Initial investment
FDD Items 5 and 7Format shown: Standard single franchise, minimum 100,000-population territory; home or leased premises, no real estate purchase
$152,900–$298,675 total initial investment. Excludes real estate purchase. Includes 3 months of additional funds.
View full investment breakdown — Items 5 & 7
| Initial franchise fee (the named Item 5 fee only) | $42,500 Disclosed
Disclosed as 'Initial Franchise Fee (Minimum Initial Franchise Fee)'. Multiple discounts exist (VetFran 20%, Roll-In up to 50%, Multi-Unit up to 20%, HIRE up to 25%, Additional Concept 10%, rural-territory pricing) but none set the standard new-franchisee price; the fee also scales with territory population above 100,000. Other required Item 5 payments to the franchisor are listed separately below — this figure is the named fee only. |
|---|---|
| Other required initial payments to the franchisor (Item 5) |
|
| Total Item 5 payments to franchisor/affiliates | $43,750 Disclosed
Cover page: total investment of $298,675 'includes $43,750 that must be paid to the franchisor and our affiliates.' |
| Total initial investment — low | $152,900 Disclosed
Item 7 Totals row; the FDD annotates the low total '(Does not include real estate costs)'. The same figure appears on the cover page. |
| Total initial investment — high | $298,675 Disclosed
Item 7 Totals row reads '$298,675 + any additional franchise fee + any real estate costs'. The cover page states the same $152,900-$298,675 range. |
| Midpoint of range | $225,788 Derived
|
| Real estate purchase included? | No — assumes a leased site |
| Additional funds assumed | 3 months |
| Required liquid capital | Not disclosed in the reviewed source Not disclosedNot disclosed in the reviewed source. We did not find this value in 2026 Franchise Disclosure Document — Mr. Rooter SPV LLC; we do not fill gaps with estimates or third-party figures. No minimum liquid-capital requirement is stated on the cover pages or in Items 1, 5, 7, 11, 12 or 15 of the reviewed document. |
| Required net worth | Not disclosed in the reviewed source Not disclosedNot disclosed in the reviewed source. We did not find this value in 2026 Franchise Disclosure Document — Mr. Rooter SPV LLC; we do not fill gaps with estimates or third-party figures. No minimum net-worth requirement for franchisees is stated in the reviewed document. |
The Item 7 chart covers a new single franchise with the minimum 100,000-population territory. It excludes any land or building purchase; the business may be run from the franchisee's home if zoning allows, and the real-estate line is rent only (a typical premises is described as 4,000 sq ft at $11,000-$24,000 per year). Additional funds cover 3 months from opening and exclude the franchisee's salary and living expenses; the minimum local marketing spend is shown separately. Arithmetic checks: the low line items sum exactly to $152,900; the high line items sum to $298,250, so the printed $298,675 high total implies an initial franchise fee of $42,925, i.e. $42,500 plus one $425 territory increment. In the private-equity Development Agreement table the printed TOTALS high of $315,250 does not foot with its own components ($21,250 + $294,383 = $315,633), and the cover page states $315,633; the Item 7 figure is recorded here.
Item 7 line items (12)
| Expenditure | Low | High |
|---|---|---|
| Initial franchise fee — High column adds $425 per 1,000 population above the 100,000 minimum. | $42,500 | $42,500 |
| Software System enrollment fee — Per license granted; paid to the franchisor. | $1,250 | $1,250 |
| Vehicle — Low assumes an existing compliant vehicle with decals; high assumes purchase plus decals and racks. | $25,000 | $69,300 |
| Equipment, supplies and inventory — Low assumes the buyer already owns a similar existing business. | $25,000 | $40,000 |
| Insurance | $12,000 | $18,000 |
| Advertising, promotional and local marketing spending | $12,500 | $30,000 |
| Training, travel, lodging and food | $4,000 | $8,000 |
| Deposits, permits and licenses | $350 | $4,000 |
| Professional fees | $1,500 | $8,000 |
| ServiceTitan software setup — Low assumes 1 user; high assumes about 15 users. | $2,800 | $8,200 |
| Real estate — Rent only; high includes about six months' rent for roughly 4,000 sq ft if space is leased. | $6,000 | $24,000 |
| Additional funds — 3 months | $20,000 | $45,000 |
Source for every row: the Item 7 estimated-initial-investment table of 2026 Franchise Disclosure Document — Mr. Rooter SPV LLC (table begins PDF p. 44) — rows inherit the table's citation rather than carrying fifteen identical ones.
Other formats disclosed in Item 7 (1)
| Format | Low | High | Fee |
|---|---|---|---|
| Development Agreement (private-equity owners only; 2 to 5 businesses) | $157,150 | $315,250 | $8,500 |
Ongoing fees
FDD Item 6Royalty
6% of gross sales Disclosed
- Source
- 2026 Franchise Disclosure Document — Mr. Rooter SPV LLC
- Document
- FDD 2026, issued 2026-04-02
- Item
- Item 6 — Other Fees table — License Fee
- Page
- PDF p. 30
- Obtained
- Wisconsin Department of Financial Institutions — Franchise Registration Search, file 640790
6% of Gross Sales except for special rates that apply to "roll-in" sales.
Called the License Fee; 6% of Gross Sales reported and paid weekly. A minimum License Fee applies from about week 40 onward, ranging from $100 to $1,400 per week depending on territory population and how long the franchisee has been in the system, and is charged regardless of sales. Reduced introductory rates (2.5%-3%) apply for the first 26-104 weeks to franchisees who roll an existing business into the franchise. If a franchisee holds over after the term expires, the License Fee rises to 10% of Gross Sales.
Brand advertising fund
2% of gross sales Disclosed
- Source
- 2026 Franchise Disclosure Document — Mr. Rooter SPV LLC
- Document
- FDD 2026, issued 2026-04-02
- Item
- Item 6 — Other Fees table — MAP Fee
- Page
- PDF p. 31
- Obtained
- Wisconsin Department of Financial Institutions — Franchise Registration Search, file 640790
2% of Gross Sales except for special rates that apply to "roll-in" sales.
Marketing, advertising and promotion (MAP) fee of 2% of Gross Sales, paid weekly with the License Fee. Roll-in franchisees pay 0.5%-1% for an introductory period. No minimum MAP fee applies to standard franchisees.
Local marketing
8% of gross sales Disclosed
- Source
- 2026 Franchise Disclosure Document — Mr. Rooter SPV LLC
- Document
- FDD 2026, issued 2026-04-02
- Item
- Item 6 — Other Fees notes — Minimum Local Marketing Spending
- Page
- PDF p. 38
- Obtained
- Wisconsin Department of Financial Institutions — Franchise Registration Search, file 640790
equal to the greater of: (a) $50,000; or (b) 8% of your Gross Sales for the previous year
The franchisor reserves the right to require an annual local marketing spend equal to the greater of $50,000 or 8% of the prior year's Gross Sales, in addition to the MAP fee. Separately, and whether or not that requirement is imposed, the franchisee must spend $60,000 on local marketing in the first 12 months of operation and $75,000 in months 13-24. Amounts paid to a local marketing group count toward the requirement.
Core requirements shown separately; caps, credits and conditions may overlap. Check the full schedule for technology, cooperative, transfer and other charges.
View all recurring fees and conditions
| Royalty | 6% of gross sales Disclosed
Called the License Fee; 6% of Gross Sales reported and paid weekly. A minimum License Fee applies from about week 40 onward, ranging from $100 to $1,400 per week depending on territory population and how long the franchisee has been in the system, and is charged regardless of sales. Reduced introductory rates (2.5%-3%) apply for the first 26-104 weeks to franchisees who roll an existing business into the franchise. If a franchisee holds over after the term expires, the License Fee rises to 10% of Gross Sales. Called the License Fee; 6% of Gross Sales reported and paid weekly. A minimum License Fee applies from about week 40 onward, ranging from $100 to $1,400 per week depending on territory population and how long the franchisee has been in the system, and is charged regardless of sales. Reduced introductory rates (2.5%-3%) apply for the first 26-104 weeks to franchisees who roll an existing business into the franchise. If a franchisee holds over after the term expires, the License Fee rises to 10% of Gross Sales. |
|---|---|
| Advertising / brand fund | 2% of gross sales Disclosed
Marketing, advertising and promotion (MAP) fee of 2% of Gross Sales, paid weekly with the License Fee. Roll-in franchisees pay 0.5%-1% for an introductory period. No minimum MAP fee applies to standard franchisees. Marketing, advertising and promotion (MAP) fee of 2% of Gross Sales, paid weekly with the License Fee. Roll-in franchisees pay 0.5%-1% for an introductory period. No minimum MAP fee applies to standard franchisees. |
| Required local marketing | 8% of gross sales Disclosed
The franchisor reserves the right to require an annual local marketing spend equal to the greater of $50,000 or 8% of the prior year's Gross Sales, in addition to the MAP fee. Separately, and whether or not that requirement is imposed, the franchisee must spend $60,000 on local marketing in the first 12 months of operation and $75,000 in months 13-24. Amounts paid to a local marketing group count toward the requirement. The franchisor reserves the right to require an annual local marketing spend equal to the greater of $50,000 or 8% of the prior year's Gross Sales, in addition to the MAP fee. Separately, and whether or not that requirement is imposed, the franchisee must spend $60,000 on local marketing in the first 12 months of operation and $75,000 in months 13-24. Amounts paid to a local marketing group count toward the requirement. |
| Technology / software | $176/month Disclosed
$176.45 per month for the Technology Package (Qvinci, Customer Engagement Platform, Neighborly Franchise Portal, FranConnect and two Microsoft 365 email accounts), collected by the franchisor's affiliate ZorWare. This excludes ServiceTitan, the required business-management software, billed separately by ServiceTitan, Inc. at roughly $151-$241 per service-professional user per month depending on user count. Optional add-ons: extra email accounts $5.50-$30/month, extra portal users $20-$40/month, QuickBooks Online through ZorWare $30-$220/month; ServiceTitan support from the franchisor at $125/hour; $25/month late fee. $176.45 per month for the Technology Package (Qvinci, Customer Engagement Platform, Neighborly Franchise Portal, FranConnect and two Microsoft 365 email accounts), collected by the franchisor's affiliate ZorWare. This excludes ServiceTitan, the required business-management software, billed separately by ServiceTitan, Inc. at roughly $151-$241 per service-professional user per month depending on user count. Optional add-ons: extra email accounts $5.50-$30/month, extra portal users $20-$40/month, QuickBooks Online through ZorWare $30-$220/month; ServiceTitan support from the franchisor at $125/hour; $25/month late fee. |
| Advertising cooperative | 2%–3% of gross sales Disclosed
Contributions to a designated local marketing group or advertising cooperative may not exceed 3% of Gross Sales; as of the issuance date the franchisor may require 2% of Gross Sales to be directed to Neighborly marketing and brand-awareness initiatives. Item 6 states there currently are no cooperatives. Contributions count toward the minimum local marketing spend. Contributions to a designated local marketing group or advertising cooperative may not exceed 3% of Gross Sales; as of the issuance date the franchisor may require 2% of Gross Sales to be directed to Neighborly marketing and brand-awareness initiatives. Item 6 states there currently are no cooperatives. Contributions count toward the minimum local marketing spend. |
| Transfer fee | $15,000 one-time Disclosed
The greater of $15,000 or 5% of the sales price, payable before transfer. May be discounted or waived for a transfer to an entity the franchisee controls or to an immediate family member. A separate $14,900 training fee applies if the buyer trains before closing under a Buyer Commitment Agreement. The greater of $15,000 or 5% of the sales price, payable before transfer. May be discounted or waived for a transfer to an entity the franchisee controls or to an immediate family member. A separate $14,900 training fee applies if the buyer trains before closing under a Buyer Commitment Agreement. |
| Renewal fee | $5,000 one-time Disclosed
Payable on renewal, together with signing the then-current franchise agreement and a general release. Payable on renewal, together with signing the then-current franchise agreement and a general release. |
| Royalty + ad fund (% of sales) | 8% Derived
|
Fee schedule (31 fees; 19 verified against the source, 12 single-pass)
Every recurring, conditional and one-time fee found in this FDD's Item 6 table (plus mandatory recurring costs disclosed in Items 7/11), each cited to its page and carrying its verification status: verified means two independent readings agreed or a tie-break re-inspection of the page decided it; single-pass means one reading captured it and it has not been independently confirmed (permitted only for fees that cannot move modeled economics — see the materiality rule). Amounts marked “not stated” are charged at then-current rates the FDD does not quantify and are never modeled as $0.
| Fee | Amount | Frequency | Mandatory | Verification | Cite | Notes |
|---|---|---|---|---|---|---|
| License Fee | 6% of gross sales | weekly | Yes | verified (2-pass) | Item 6, p. 30 | Payable weekly on the prior week's Gross Sales; failure to report triggers automatic charge of the Minimum License Fee. |
| MAP Fee (Marketing, Advertising and Promotion) | 2% of gross sales | weekly | Yes | verified (2-pass) | Item 6, p. 31 | No Minimum MAP Fee applies to standard (non-roll-in) franchisees. |
| Local Marketing Groups | 2%–3% of gross sales | varies | No | verified (tie-break) | Item 6, p. 31 | Applies only where the franchisor designates a local advertising market, cooperative or LMG for the franchisee's market; participation and contribution are then mandatory. 'There currently are no cooperatives.' Pass A's 2%/3% pair is the fuller reading and both halves are on the page: the row states the 3% ceiling and then the currently-directed 2% portion. Pass B's single value of 3 keeps only the cap. Franchisor-owned outlets contribute at the same rate; LMG members have no votes and only advise. |
| Minimum Local Marketing Spending | $8 (min $50,000/annual) | annual | Yes | verified (2-pass) | Item 6, p. 38 | In addition to the MAP Fee; applies after the Initial Marketing Spend Requirement period; franchisor 'reserves the right' to impose/collect it. |
| Initial Marketing Spend Requirement | Tiered (base $60,000) | annual | Yes | verified (tie-break) | Item 6, p. 38 | Unconditional for the first two years: 'Regardless of whether we impose the Minimum Local Marketing Spending on you, you must spend a minimum of $60,000 ...'. After month 24 the Minimum Local Marketing Spending governs. Two passes differed only on amount_type, id and model_treatment; the amounts, tiers and page agree. amount_type 'tiered' matches the two-step schedule already carried in tiers (Pass B's 'fixed' cannot express $60,000 then $75,000). Repeated verbatim in Item 7 note 5. Id follows the FDD's defined term 'Initial Marketing Spend Requirement'. |
| Software System Fees – Technology Package | $176 | monthly | Yes | verified (2-pass) | Item 6, p. 31 | May increase up to ~30% annually plus vendor price increases. |
| ServiceTitan business management software license (per user) | Tiered (base 228%) | monthly | Yes | verified (tie-break) | Item 6, p. 38 | Mandatory - the franchisee must license the designated business management software from ServiceTitan, Inc. Cost scales with the number of service-professional users. SOURCE CONFLICT, not a reading conflict: Item 6 note 1 (p.38) prices the first tier at '$228-241 per month for each service professional user up to 5 service professional users' and gives no office-user rate, while Item 11 (p.62) states 'The current license fees for ServiceTitan are as follows: $131.36 per month for each office user up to 5 office users; and $87.21 per month for each service professional user up to 5 service professional users'. Both cannot be right. Item 6 is the fee-disclosure item and is used as the primary figure, and Item 7 note 9's low estimate of $2,800 for a 1-user operation annualises close to Item 6's tier-1 rate; but the ~2.6x gap in the per-user rate is unresolved, so evidence is set to 'unresolved' and the fee is kept out of derived cost metrics. |
| QuickBooks Online (via ZorWare) | $30–$220 | monthly | No | verified (2-pass) | Item 6, p. 31 | QuickBooks Online itself is required, but this ZorWare markup only applies if licensed through ZorWare rather than directly from Intuit. |
| Additional Microsoft Office365 email accounts | $6–$30 | monthly | No | verified (tie-break) | Item 6, p. 31 | Optional, only beyond the two email accounts already included in the Technology Package. Verified on the Software System Fees row, PDF p.31. |
| Additional Franchise Portal User Accounts | $20–$40 | monthly | No | verified (tie-break) | Item 6, p. 31 | Optional add-on beyond the base Technology Package. Verified on the Software System Fees row, PDF p.31. |
| ServiceTitan support and maintenance (hourly) | $125 | varies | No | verified (tie-break) | Item 6, p. 31 | Charged only when the franchisee requests support or maintenance on ServiceTitan; maintenance on the Technology Package is covered by the monthly Software System Fee. Corroborated in Item 11 p.62: 'any maintenance on the ServiceTitan software is provided at ZorWare's then-current hourly rates (currently $125/hr)'. |
| HelpDesk Plus Fee (QuickBooks support) | $400 | monthly | No | verified (2-pass) | Item 6, p. 32 | Optional service from affiliate BackOffice; overage billed at $75/hour beyond the included 6 hours. |
| Call Center Program Fee | $350–$450 | monthly | Yes | verified (2-pass) | Item 6, p. 33 | Mandatory for rollover calls and after-hours/weekend customer calls. Calculator audit 2026-09-03: Item 6's Call Center Program Fee row has a per-appointment component beyond the modeled monthly range that the prior model_note didn't disclose. (p. 33; "$349.99-$449.99 / month (depending on the third-party vendor NCS is able to use)") |
| Annual Convention (“Reunion”) Fee | $1,000 | annual | Yes | verified (2-pass) | Item 6, p. 34 | Attendance required every year (Item 11); a $2,000 pro-rata charge applies if the franchisee does not attend/participate. |
| Key Accounts / Management Fee | Not stated | varies | No | verified (tie-break) | Item 6, p. 36 | Applies only if the franchisee participates in a Key Accounts program; the franchisor 'reserves the right to require' the fee and may deduct it from payments or add it to the invoice. Third-party billing providers may charge further percentage or per-invoice fees the franchisor cannot estimate. The row discloses a ceiling only ('Up to 5%'), so value stays null with the 5% recorded as range_high/maximum - recording 5 as the rate (Pass B) would assert a rate the FDD does not state. Key Account Gross Sales remain subject to the standard 6% License Fee, so the fee stacks on the royalty. Row begins on PDF p.36 and runs onto p.37; Pass B's p.35 is the printed page number, not the PDF page. |
| Additional Training Fees | $1,000 | per event | No | verified (tie-break) | Item 6, p. 37 | Charged only if the franchisee requests training beyond the initial training program. Training may be conducted remotely, in which case no travel expense is incurred. The $1,000 is a per-day ceiling, not a flat charge; recorded with a maximum object to say so. |
| Late Fee – Software System Monthly Fees | $25 | varies | No | single-pass | Item 6, p. 33 | Charged only if Software System fees are unpaid more than 30 days after invoice. [Listed by one verification pass only (A); not independently confirmed.] |
| Late Fee – Franchise Agreement | $10 | varies | No | single-pass | Item 6, p. 35 | Accrues per day on overdue amounts. [Listed by one verification pass only (A); not independently confirmed.] |
| Interest on Unpaid Balances | 12% of other | varies | No | single-pass | Item 6, p. 35 | Per annum rate, collectible on demand including via weekly/monthly automatic draft. [Listed by one verification pass only (A); not independently confirmed.] |
| Audit Fee | Not stated | varies | No | single-pass | Item 6, p. 35 | Payable only if an audit finds a Gross Sales understatement of 2%+ or the franchisee fails to timely provide requested information. [Listed by one verification pass only (A); not independently confirmed.] |
| Audit Noncompliance Fee | $500 | per event | No | single-pass | Item 6, p. 35 | Also covers the cost of rescheduling an audit due to franchisee non-cooperation. [Listed by one verification pass only (A); not independently confirmed.] |
| Dishonored Check or ACH Draft Fee | $50 | per event | No | single-pass | Item 6, p. 35 | [Listed by one verification pass only (A); not independently confirmed.] |
| Tax Reimbursement | Not stated | varies | No | single-pass | Item 6, p. 36 | Pass-through of any tax/fee imposed on the franchisor due to required payments from the franchisee. [Listed by one verification pass only (A); not independently confirmed.] |
| Indemnification and Attorneys' Fees and Costs | Not stated | varies | No | single-pass | Item 6, p. 36 | Contingent liability if the franchisor must enforce the Franchise Agreement or is sued due to the franchisee's acts/omissions. [Listed by one verification pass only (A); not independently confirmed.] |
| Transfer Fee | $15,000 | one time | No | single-pass | Item 6, p. 34 | Payable on sale/transfer of the Business; may be discounted/waived for transfers to a controlled entity or immediate family. [Listed by one verification pass only (A); not independently confirmed.] |
| Training Fee (Buyer Commitment Agreement) | $14,900 | one time | No | single-pass | Item 6, p. 35 | Only if, on a transfer, the seller and transferee-buyer request pre-closing training; in addition to other transfer requirements. [Listed by one verification pass only (A); not independently confirmed.] |
| Renewal Fee | $5,000 | one time | No | single-pass | Item 6, p. 35 | [Listed by one verification pass only (A); not independently confirmed.] |
| Amendment Fee | $300 | per event | No | single-pass | Item 6, p. 36 | [Listed by one verification pass only (A); not independently confirmed.] |
| Minimum License Fees | Tiered (base $100) | weekly | Yes | verified (tie-break) | Item 6, p. 40 | No minimum applies in weeks 1-39 for a standard (non roll-in) franchise. From week 40 the franchisee pays the greater of the 6% percentage License Fee or this weekly floor. Page corrected from Pass B's 30 (the printed page number) to PDF p.40, where both the Minimum License Fees table and the population-band table appear. overlaps_with points at the royalty entry ('royalty' in the record's fee structure; Pass B called it 'license-fee'). Cover-page special risk 2 highlights these minimum payments regardless of sales level. |
| Paradox ATS annual fee | $703 | annual | No | verified (tie-break) | Item 11, p. 63 | Optional - the applicant tracking system is offered, not required, and the franchisee may opt out at any time. Disclosed only in Item 11, not in the Item 6 table. Increases not anticipated above 30% annually plus vendor pass-throughs. |
| Insurance | $12,000–$18,000 | annual | Yes | verified (tie-break) | Item 7, p. 44 | Mandatory coverage: 'You must purchase the insurance coverage described in Item 8. If you do not, we can purchase it for you and bill you for our costs.' Workers' compensation may be extra depending on locality. Paid to third parties or the franchisor. Not an Item 6 fee - a mandatory third-party cost disclosed in Item 7 (line on PDF p.44, note 4 on p.45) against the coverage Item 8 requires. The FDD never labels the line annual; only the 'Additional Funds' line is period-stamped (3 months), so the annual framing is our inference and is flagged in model_note. |
Fees are reported and collected weekly by automatic bank draft based on the prior week's Gross Sales. Gross Sales are defined broadly and exclude only sales taxes, authorised refunds and rebates, and any agreed Excluded Services. The franchisor highlights on its cover page that minimum License Fee and MAP fee payments are due regardless of sales. Other charges in Item 6 include a $300 amendment fee, audit costs where an understatement of 2% or more is found, an audit non-compliance fee of $500 per document up to $2,500, and additional training at up to $1,000 per day.
Financial performance (Item 19)
What the franchisor actually disclosedWho is represented: Franchised Mr. Rooter businesses in the United States that were in business 12 months or more and reported Gross Sales for all 52 weeks of calendar 2025 — 193 of the 238 U.S. franchised outlets open at Dec 31, 2025. Excluded: 22 outlets that opened during 2025, 14 that were transferred during 2025 and did not report a full period, 9 that reported $0 of Gross Sales for every week, and 13 that closed during the year (one of which had been open less than 12 months). No company-owned or affiliate-operated outlets are included, and no non-U.S. outlets are included.
Qualifications: Gross Sales only — the Item 19 discloses no costs, expenses, margins or profit, so nothing here indicates what an owner earns. Figures come from franchisee reporting through the franchisor's software system, are not required to follow GAAP, and are not audited. The table covers 193 of 238 U.S. franchised outlets (about 81%); the 45 excluded outlets are disproportionately new, transferred, non-reporting or closed units, so the reported spread understates the experience of outlets in their first year and of outlets that failed. Company-owned and UK outlets are excluded. The distribution is very wide: the top 10% average $8.16m while the bottom 10% average $147,745, and the lowest reporting outlet recorded $633 for the year. Only 33% of the reporting businesses reached the $2,093,531 systemwide average. Gross Sales exclude sales taxes, authorised refunds and rebates, and any agreed Excluded Services.
View full Item 19 disclosure and tables
The FDD contains a financial performance representation covering calendar 2025. It reports average and median annual Gross Sales for 193 U.S. franchised businesses that had been open at least 12 months and reported sales for all 52 weeks, broken into seven groups: the whole reporting population plus the top and bottom 10%, 25% and 50%. Across all 193, average Gross Sales were $2,093,531 and the median was $1,257,146, with 33% of businesses at or above the average. The reported range runs from $633 to $20,262,638 for the year, and the average of the bottom half ($614,354) is less than a fifth of the average of the top half ($3,557,458). The disclosure is revenue only: no cost, expense, margin or profit information is given, and the franchisor notes that franchisees are not required to use GAAP when reporting these figures. Prospective buyers cannot infer earnings from these numbers, and the excluded units (opened, transferred, non-reporting or closed during the year) mean the table is not a complete picture of the system.
| Metric | Subset | Value | Units | Period | Cite |
|---|---|---|---|---|---|
| Average annual Gross Sales — all reporting franchised businesses 33% of units met or exceeded 64 of 193 businesses attained or exceeded this figure. | All reporting (100%) Average | $2,093,531 | 193 | CY2025 | FDD p.92 |
| Median annual Gross Sales — all reporting franchised businesses | All reporting (100%) Median | $1,257,146 | 193 | CY2025 | FDD p.92 |
| Highest annual Gross Sales reported by any reporting franchised business | All reporting (100%) High | $20,262,638 | 193 | CY2025 | FDD p.92 |
| Lowest annual Gross Sales reported by any reporting franchised business | All reporting (100%) Low | $633 | 193 | CY2025 | FDD p.92 |
| Average annual Gross Sales — top 10% of reporting businesses 26% of units met or exceeded Group range $4,581,213 to $20,262,638; 5 of 19 attained the group average. | Top 10% Quartile avg. | $8,162,009 | 19 | CY2025 | FDD p.92 |
| Median annual Gross Sales — top 10% of reporting businesses | Top 10% Quartile median | $6,087,233 | 19 | CY2025 | FDD p.92 |
| Average annual Gross Sales — top 25% of reporting businesses 27% of units met or exceeded Group range $2,547,216 to $20,262,638. | Top 25% Quartile avg. | $5,243,078 | 48 | CY2025 | FDD p.92 |
| Median annual Gross Sales — top 25% of reporting businesses | Top 25% Quartile median | $4,121,620 | 48 | CY2025 | FDD p.92 |
| Average annual Gross Sales — top 50% of reporting businesses 30% of units met or exceeded Group range $1,257,146 to $20,262,638. | Top 50% Quartile avg. | $3,557,458 | 97 | CY2025 | FDD p.92 |
| Median annual Gross Sales — top 50% of reporting businesses | Top 50% Quartile median | $2,530,999 | 97 | CY2025 | FDD p.92 |
| Average annual Gross Sales — bottom 50% of reporting businesses 50% of units met or exceeded Group range $633 to $1,235,628. | Bottom 50% Quartile avg. | $614,354 | 96 | CY2025 | FDD p.92 |
| Median annual Gross Sales — bottom 50% of reporting businesses | Bottom 50% Quartile median | $593,671 | 96 | CY2025 | FDD p.92 |
| Average annual Gross Sales — bottom 25% of reporting businesses 48% of units met or exceeded Group range $633 to $550,188. | Bottom 25% Quartile avg. | $288,402 | 48 | CY2025 | FDD p.92 |
| Median annual Gross Sales — bottom 25% of reporting businesses | Bottom 25% Quartile median | $294,005 | 48 | CY2025 | FDD p.92 |
| Average annual Gross Sales — bottom 10% of reporting businesses 53% of units met or exceeded Group range $633 to $257,600. | Bottom 10% Quartile avg. | $147,745 | 19 | CY2025 | FDD p.92 |
| Median annual Gross Sales — bottom 10% of reporting businesses | Bottom 10% Quartile median | $149,691 | 19 | CY2025 | FDD p.92 |
System health (Item 20)
Outlets, openings, exits and transfers by fiscal year · U.S. onlyView detailed Item 20 tables and source notes
| Fiscal year | Start | Opened | Terminated | Not renewed | Reacquired | Ceased — other | End | Transfers | Company-owned (end) |
|---|---|---|---|---|---|---|---|---|---|
| 2023 | 209 | 11 | 0 | 1 | 0 | 4 | 215 | 10 | 3 |
| 2024 | 215 | 22 | 4 | 2 | 0 | 3 | 228 | 16 | 3 |
| 2025 | 228 | 23 | 11 | 1 | 0 | 1 | 238 | 15 | 2 |
Disclosed 2026 Franchise Disclosure Document — Mr. Rooter SPV LLC, Item 20, Tables 1–3 (PDF p. 94). All three status tables foot exactly. Franchised outlets grew from 209 to 238 over three years (+29 net, +13.9%), but departures accelerated: 5 franchised outlets left the system in 2023, 9 in 2024 and 13 in 2025 (11 of the 2025 departures were terminations, which the FDD says include mutual terminations). Openings also rose, from 11 to 22 to 23. Transfers to new owners ran 10, 16 and 15 across the three years — roughly 6% of the franchised base each year. Company-owned counts are affiliate-operated locations; one Washington outlet was sold to a franchisee in 2025, leaving 2. Outlet counts cover the U.S. and Puerto Rico; 4 UK master-franchise locations reported in Item 1 are excluded. 'Ceased operations - other reasons' includes outlets absorbed by another franchisee, so it is not purely closure. Item 20 also states that some current and former franchisees have signed confidentiality provisions that may limit what they can say about their experience.
Source data notes (5) — inconsistencies found in the FDD itself during verification
Our verification re-reads every table. Where the FDD's own printed tables disagree, we document the discrepancy rather than silently "fixing" it. Classes: B = arithmetic error in the source's derived column; C = the printed tables genuinely disagree; D = a legitimate definitional difference (e.g., transfers netted, explained by a footnote); E = unresolved ambiguity. Figures a material C/E issue puts in doubt are excluded from our derived metrics, scores and rankings.
- [C/minor] Table No. 1 2025: Item 1 (PDF p.11) states 'As of December 31, 2025, there were a total of 238 Mr. Rooter franchises and 3 affiliate-operated locations in operation in the U.S.', but Item 20 Table No. 1 (PDF p.94) shows Company-Owned outlets starting 2025 at 3 and ending at 2 (Net Change -1), and Table No. 4 (Totals row, PDF p.102) shows the same 3 -> 2 with one Washington outlet 'Sold to Franchisees' in 2025. Two statements of the same date differ by one company-owned outlet. — Use the Item 20 figure: company-owned 2 at 12/31/2025, total outlets 240. Item 20's tables corroborate each other three ways - Table 1 company-owned end 2025 = 2, Table 4 Totals 2025 = 3 start / 1 sold / 2 end, and Table 1 Total Outlets 2025 = 240 = 238 franchised + 2 company-owned. Item 1's franchised count (238) matches Table 1 exactly, so only its affiliate-operated count is stale. The franchised TOTAL rows the site uses are untouched, hence minor.
- [D/minor] Table No. 3 2025: Item 19 (PDF p.92) excludes 'data from (i) 22 franchised businesses that opened during the year 2025', while Item 20 Table No. 3's Total row (PDF p.101) reports 23 franchised Outlets Opened in 2025 - a one-unit difference in the same year's openings. — A definitional difference the tables themselves document. Table No. 3 note 1 states 'Included in "Outlets Opened" are outlets that were opened after a new franchisee purchased the franchised business from an existing owner and the previous owner's franchise agreement was terminated' - i.e. Table 3 counts one class of transfer-driven re-opening as an opening, while Item 19 books transfers in a separate bucket (it excludes 22 openings AND 14 transferred businesses separately, and its own arithmetic foots on 22: 238 - 22 - 14 - 9 = 193). The Table 3 TOTAL is corroborated: 228 + 23 - 11 - 1 - 0 - 1 = 238, matching Table No. 1's franchised end-of-2025 count of 238. One unit is 0.44% of the 228 franchised outlets at the start of 2025, below the 0.5% threshold, and net units, growth and closures
- [D/minor] Table No. 3 2025: Table No. 3's 'Ceased operations - other reasons' column mixes genuine failure with consolidation. Note 4 defines it as 'abandonment of the franchise outlet after an existing outlet was opened ... Also included in this column are franchise outlets that have been sold and/or transferred to an existing franchisee or a franchisee in another state ... [and] outlets where the franchise agreement was terminated and the territory was added to an existing franchisee franchise unit outlet'. — Legitimate table-definition difference, disclosed in note 4 and symmetric with Table No. 2, whose transfer counts exclude territory-only sales (note 3 likewise excludes territory-only purchases from 'reacquisitions'). The column overstates distress: of the ceased-other counts (4 in 2023, 3 in 2024, 1 in 2025) an unknown share is consolidation. The TOTAL rows still foot and match Table 1, so unit counts and growth are unaffected; only the interpretation of attrition is.
- [D/minor] Table No. 1: Table No. 1 note 1 excludes from 'outlets' both the sale of a new territory to an existing franchisee where no separate operating location opens and the execution of a franchise agreement for a location not yet open, so outlet counts understate agreements and territories sold. Table No. 5 shows 16 agreements signed but not opened against 18 projected openings in the next fiscal year (both state columns foot: 16 and 18; Texas alone holds 6 of the 16). — Legitimate definition stated in note 1 - the standard FTC 'outlet' basis. No correction needed; the site should present unit counts as operating outlets, not franchise agreements, and can use Table 5's 16 signed-not-open as forward pipeline.
- [D/minor] Item 20 scope 2025: Item 20 covers U.S. outlets only. Item 1 (PDF p.11) states 'As of December 31, 2025, we also had 4 franchised locations in the UK', and those 4 appear in no Item 20 table; there is no separate international table. — Legitimate scope of the FTC Item 20 disclosure, not an error. Any systemwide unit count shown on the site should be labelled U.S.-only (238 franchised + 2 company-owned = 240) with the 4 UK master-franchise locations noted separately.
Company-owned outlets (Table 4)
| Year | Start | Opened | Reacquired from franchisee | Closed | Sold to franchisee | End |
|---|---|---|---|---|---|---|
| 2023 | 3 | 0 | 0 | 0 | 0 | 3 |
| 2024 | 3 | 0 | 0 | 0 | 0 | 3 |
| 2025 | 3 | 0 | 0 | 0 | 1 | 2 |
Read: How to read Item 20.
Ownership and operations
Items 11, 12, 15, 17Owner-operator required Disclosed
- Source
- 2026 Franchise Disclosure Document — Mr. Rooter SPV LLC
- Document
- FDD 2026, issued 2026-04-02
- Item
- Item 15
- Page
- PDF p. 82
- Obtained
- Wisconsin Department of Financial Institutions — Franchise Registration Search, file 640790
you must directly perform or supervise the operation of the Business unless we consent otherwise
An individual franchisee must directly perform or supervise the operation of the business unless the franchisor consents otherwise; where the franchisee is an entity, on-site supervision must be provided by a designated principal owner who has completed training. Only with the franchisor's agreement may a trained, bona fide manager supervise instead, and that manager need not hold equity. Private-equity owners may use a managing principal with no ownership interest. Principal owners of an entity franchisee must sign a personal guaranty, and where the franchisor provides financing it may require a spouse's guaranty.
View operating requirements, territory and contract term
| Owner involvement (Item 15) | Owner-operator required Disclosed
An individual franchisee must directly perform or supervise the operation of the business unless the franchisor consents otherwise; where the franchisee is an entity, on-site supervision must be provided by a designated principal owner who has completed training. Only with the franchisor's agreement may a trained, bona fide manager supervise instead, and that manager need not hold equity. Private-equity owners may use a managing principal with no ownership interest. Principal owners of an entity franchisee must sign a personal guaranty, and where the franchisor provides financing it may require a spouse's guaranty. An individual franchisee must directly perform or supervise the operation of the business unless the franchisor consents otherwise; where the franchisee is an entity, on-site supervision must be provided by a designated principal owner who has completed training. Only with the franchisor's agreement may a trained, bona fide manager supervise instead, and that manager need not hold equity. Private-equity owners may use a managing principal with no ownership interest. Principal owners of an entity franchisee must sign a personal guaranty, and where the franchisor provides financing it may require a spouse's guaranty. |
|---|---|
| Initial training | Three mandatory programs must all be completed before opening. Initial Training is about 14-15 classroom hours delivered by phone, webinar or online portal over a 1 to 3 week period. Business Training is roughly 34 classroom hours over 4 to 5 days, held at the franchisor's Waco, Texas offices or by video conference, offered about six times a year. Systems Training is a virtual ServiceTitan point-of-sale course of at least 18 hours spread over 6 to 8 weeks, plus 8-40 hours of on-the-job time; an optional field training program in an operating franchise adds a further 8-40 hours. At least one owner must attend and complete all training, and for Business Training both an owner and any location manager must attend. The franchisee and four other people are trained at no additional charge; travel and living costs are the franchisee's. Attendance at the annual Reunion conference is required every year. Disclosed
Item 11 states franchisees typically open 2 to 5 months after signing and the franchise agreement requires opening within 6 months. Instructor experience disclosed in Item 11 is limited: the President has less than a year with the franchisor and instructors' plumbing-industry experience ranges from 2 to 4 years. |
| Multi-unit / development options | There is no general right to additional units. An existing franchisee may be permitted to open another Mr. Rooter business only if it meets the franchisor's discretionary Expansion Criteria, which consider system compliance, performance thresholds, leadership, financial capacity and limits on how many businesses one franchisee may own. A franchisee may buy an 18-month option on additional territory by paying 10% of that territory's initial franchise fee, non-refundable if not exercised. Franchisees of at least two years' standing receive a 5%-20% discount on the initial fee for additional territory, plus a further 5% for paying within 90 days. A separate Development Agreement is offered only to private-equity owners, requiring 2 to 5 businesses with a development fee of 10% of the aggregate initial franchise fees, credited against them; the first business must open within 6 months. Disclosed
Development Agreement terms also appear in Items 1, 5 and 7. Item 12 sets pro-forma caps on private-equity ownership at 10% and 15% of systemwide Gross Sales depending on performance conditions. |
| Territory (Item 12) | The territory is not exclusive. It is defined by population, generally at least 100,000 and no more than 300,000, and the franchisee keeps its rights if the population grows. While the franchisee is in full compliance, the franchisor will not operate or grant another Mr. Rooter franchise with rights to market inside the territory, but it reserves broad rights to compete under other brands and channels, to serve national Key Accounts inside the territory, and to authorise others to perform work there if the franchisee cannot or will not. The franchisee may not advertise or solicit outside its territory except under the franchisor's programs. Keeping the territory depends on performance: from the second full calendar year, annual Gross Sales must rank in the top 90% of franchised businesses systemwide and the Net Promoter Score must be within 10 points of the system average. Missing either triggers a performance improvement plan; failing the plan is a default, and the franchisor may reduce the territory or terminate. Disclosed
The business may be run from the franchisee's home inside the territory where zoning allows, or from any existing business premises. |
| Initial term | 10 years Disclosed
Initial term is 10 years. |
| Renewal | One renewal term of 10 years, and only one: after renewing, there is no further automatic right of renewal. To renew the franchisee must not be in default, must have met all monetary and material obligations, must have received no more than two written default notices during the term, must not have failed the Minimum Performance Standards in any two calendar years, must give 180 to 240 days' written notice, sign a general release and the then-current franchise agreement (which may carry materially different terms and fees), complete current training and pay a $5,000 renewal fee. A franchisee that holds over after expiry pays a License Fee of 10% of Gross Sales with no reductions. Disclosed
|
Risk and legal observations
Items 3, 4, 8, 15, 17 — summarized neutrallyLitigation: 4 matter(s) disclosed Disclosed · Bankruptcy: Disclosure present Disclosed
View legal disclosures, restrictions and guarantees
| Litigation (Item 3) | 4 matter(s) disclosed Disclosed Item 3 lists four matters. Two are described as prior actions: a 2019 suit the predecessor Mr. Rooter LLC brought in federal court in Texas against a former franchisee and its principal over a non-competition covenant and trademark misuse, in which the defendants counterclaimed alleging inadequate training and support, insufficient advertising, trademark abandonment and territorial encroachment and sought damages above $200,000; it settled in November 2019 with the defendants paying $400,000 and the franchisor releasing the non-compete. The second is a 2015 trademark and false-advertising suit brought by a third party, Beacon Plumbing, against a franchisee and the predecessor and its parents in federal court in Washington; two claims were dismissed with prejudice in 2016 and the case settled in March 2017 with the predecessor paying $125,000 and instructing franchisees not to use the phrase in advertising. Third, during fiscal 2025 the franchisor filed one suit against a franchisee in Texas state court to collect money owed. Fourth, Item 3 discloses a 2017 California consent order involving a predecessor of an affiliated brand (not the franchisor) over failure to file two franchise advertisements, resolved without admission of liability with a $5,000 penalty and remedial franchise-law training. |
|---|---|
| Bankruptcy (Item 4) | Disclosure present Disclosed Item 4 discloses six insolvency proceedings involving portfolio companies controlled by KKR, the franchisor's ultimate controlling investor, and states that none involve the franchisor: Marelli Holdings (Chapter 11, June 2025); The Collected Group (prepackaged Chapter 11, 2021, emerged May 2021); Envision Healthcare (Chapter 11, 2023, emerged November 2023); Genesis Care (Chapter 11, 2023, emerged February 2024); IPI Legacy Liquidation Co., formerly Impel Pharmaceuticals (Chapter 11, 2023, emerged April 2024); and Cafe Coffee Day in India, where an appellate tribunal set aside the insolvency order in February 2025. No bankruptcy of the franchisor, its parents or its management is disclosed. |
| Personal guaranty | Required Disclosed
Where the franchisee is a corporation or other entity, its principal shareholders, members or owners must sign a Guaranty (Schedule C to the franchise agreement) agreeing to pay and perform all obligations. If the franchisor provides financing it may require a spouse's personal guaranty; the state-mandated risk factor on the cover page warns that a spouse with no ownership interest may be made liable for all financial obligations. Private-equity owners may be allowed to substitute a corporate guarantee or letter of credit. |
| Non-compete | During the term, the franchisee — and its guarantors and owners, or for an individual franchisee that person's spouse, children, parents and siblings — may not be involved in any Competitive Business, defined broadly as any business offering a product or service that forms part of the system, is similar to what franchisees offer, or otherwise competes directly or indirectly. After termination or expiry, a two-year restriction applies to any Competitive Business inside the former territory, within a 25-mile radius of the territory's outer boundary, or inside another Mr. Rooter franchisee's territory. Disclosed
Item 15 adds that while the franchisee owns the business it cannot hold an interest in or relationship with any competitor. |
| Transfer restrictions | Transfer is defined broadly: any sale, lease, pledge, management agreement, gift or bequest, any arrangement handing operation to someone sharing in profit or loss, and any change of 20% or more in direct or indirect ownership of the franchisee entity. The franchisor approves all transfers but says it will not unreasonably withhold approval. Conditions include no existing default, payment of everything owed to the franchisor, its affiliates and suppliers, all required reports delivered, the buyer qualifying and arranging training, releases from the franchisee, its owners and guarantors, payment of the transfer fee, the buyer signing the then-current agreement, and the buyer assuming outstanding customer warranty and service-plan obligations. The franchisor holds a right of first refusal to buy on the same terms as a third-party offer. On death or disability the personal representative has 120 days to satisfy the transfer conditions, with fee and right of first refusal waived for a spouse or child. The franchisor may assign the agreement to any third party without notice or consent. Disclosed
The transfer fee is the greater of $15,000 or 5% of the sales price; Item 7 notes a buyer of an operating franchise pays this instead of an initial franchise fee. |
| Termination / non-renewal | The franchisor cannot terminate without cause. Curable defaults carry a 10-day cure period for unpaid amounts or missing reports and 30 days for other defaults, subject to state law. Non-curable defaults include material misrepresentation in the application or reports, abandonment (including not operating for seven or more consecutive days), closure by authorities for safety reasons, unauthorised use of the marks or confidential information, insolvency of the franchisee or a guarantor, a felony conviction or a misdemeanour harming the marks, intentional understatement of Gross Sales or a 2% audit variance on a repeat audit within two years, unapproved transfer, and any second default of any type within a rolling 12 months even if cured. The franchisee may terminate only for the franchisor's uncured material breach, on 30 days' notice, effective 60 days after notice. On termination the franchisee must de-identify the business and vehicles, return manuals, software and customer lists, assign phone numbers, websites, social accounts and domains, assign any lease on demand, and observe the non-compete. Disclosed
Failure to meet the Minimum Performance Standards in Item 12 can also lead to territory reduction or termination after a failed performance improvement plan. |
| Supplier restrictions (Item 8) | The franchisee may use only techniques, procedures and supplies the franchisor specifies, and may offer only approved products and services. The franchisor may designate a single or primary source and may itself be that source; alternative suppliers require prior written approval, at least 30 business days' notice and payment of testing costs. Mandatory purchases from the franchisor or its affiliates are the Technology Package (Qvinci, Customer Engagement Platform, Neighborly Franchise Portal, FranConnect and two Microsoft 365 accounts) bought through affiliate ZorWare, and participation in the Call Center Program run by affiliate Neighborly Service Solutions SPV LLC. ServiceTitan business-management software must be licensed from ServiceTitan, Inc., and one mobile device per technician or vehicle is required. Telephone numbers and electronic identities used by the business must be owned and controlled by the franchisor or an approved supplier and ported to a designated call-routing supplier. Vehicles must meet specifications but may be bought from any dealer. Disclosed
The franchisor states the Technology Package and Call Center fees include a mark-up exceeding its direct costs and that it or its affiliate may profit from them. Item 8 does not state the percentage of the franchisor's revenue derived from franchisee purchases. Affiliate ProTradeNet negotiates supplier rebates ranging from 1% to 25% of suppliers' annual billings in 2025 and on average retains 25%, pays 25% to the franchisor and 50% to franchisees. |
| Dispute resolution | Most disputes must first go to mediation. If mediation fails, most disputes are resolved by litigation rather than arbitration; arbitration applies only if a court invalidates the jury-waiver or class-action waiver. Venue for mediation, arbitration and litigation is McLennan County, Texas, and Texas law governs, in each case unless state law supersedes. The cover page carries a state-required risk factor warning that out-of-state dispute resolution may cost more and may lead to a less favourable settlement. Disclosed
|
- Minimum performance standards: from the second full calendar year the business must rank in the top 90% of franchised businesses by annual Gross Sales and stay within 10 points of the system average Net Promoter Score, or face a performance improvement plan, territory reduction or termination.
- Minimum License Fee and MAP fee obligations mean weekly payments of $100 to $1,400 continue regardless of sales; the franchisor flags this as a state-required risk factor on the cover page.
- Local marketing obligations are substantial and separate from the 2% MAP fee: $60,000 in the first 12 months, $75,000 in months 13-24, and thereafter the greater of $50,000 or 8% of prior-year Gross Sales if imposed.
- The territory is expressly non-exclusive, and the franchisor may serve Key Accounts and authorise others to perform work inside it without compensating the franchisee.
- Only one 10-year renewal term is available; after it, continuation depends on both parties agreeing to a new agreement.
- Telephone numbers, websites, domains and social-media accounts used by the business must be assigned to the franchisor on termination.
- Any second default of any type within a rolling 12-month period is a non-curable default even if both were cured.
- Item 20 notes that some current and former franchisees have signed confidentiality provisions restricting what they can say about their experience.
Summaries are neutral paraphrases of the cited document and are not legal advice. Read the full Items in the current FDD and consult a franchise attorney.
Illustrative unit economics
Model estimateModel estimate — not disclosed by the franchisor, not a forecast. Fee lines below come from this brand's verified FDD fee schedule and are computed exactly as disclosed (each line shows its arithmetic). Operating-cost ratios are category placeholders we chose — every one is editable and labeled assumption. Results are illustrative arithmetic, not expected returns. Every figure here belongs to one of five labeled categories — disclosed inputs, model assumptions, unmodeled mandatory fees, user-editable assumptions, and exclusions — defined in our methodology.
| Line (annual) | Downside | Base | Upside |
|---|---|---|---|
| Revenue (AUV basis) | $614,354 | $2,093,531 | $2,407,561 |
| − Cost of goods / supplies assumption | $122,871 | $418,706 | $481,512 |
| − Payroll (excl. owner) assumption | $233,455 | $795,542 | $914,873 |
| − Occupancy assumption | $18,431 | $62,806 | $72,227 |
| − Other operating expenses assumption | $73,722 | $251,224 | $288,907 |
| − License Fee disclosed 6% of gross sales = $125,612 |
$36,861 | $125,612 | $144,454 |
| − MAP Fee (Marketing, Advertising and Promotion) disclosed 2% of gross sales = $41,871 |
$12,287 | $41,871 | $48,151 |
| − Minimum Local Marketing Spending assumption $50,000/yr (seeded from the disclosed floor) |
$50,000 | $50,000 | $50,000 |
| − Software System Fees – Technology Package disclosed $176/month × 12 = $2,117 |
$2,117 | $2,117 | $2,117 |
| − Annual Convention (“Reunion”) Fee disclosed $1,000 per year |
$1,000 | $1,000 | $1,000 |
| = Modeled operating result before the items below (EBITDA-style) | $63,610 | $344,653 | $404,319 |
| − Manager compensation assumption | $65,000 | $65,000 | $65,000 |
| = Modeled result after manager compensation | −$1,390 | $279,653 | $339,319 |
| − Illustrative debt service assumption | $25,592 | $25,592 | $25,592 |
| = Illustrative pre-tax cash flow — before taxes, capital expenditures and unmodeled fees | −$26,982 | $254,062 | $313,727 |
| Modeled operating margin | 10.4% | 16.5% | 16.8% |
This modeled result is not owner income. It excludes: income taxes; capital expenditures and equipment-replacement reserves; working-capital needs; ramp-up losses; owner-specific costs; one-time and per-event fees (transfer, renewal, audit); and 4 mandatory fee(s) whose amounts the FDD does not state (listed below — real outflows are higher by these amounts). It is illustrative arithmetic on stated assumptions, not a promise or forecast of what a franchisee earns.
Mandatory fees disclosed but not quantified — not included in the modeled result: the FDD requires these but states no amount (e.g. billed at "then-current" rates). They are never modeled as $0. If you have a quote or estimate, enter an annual amount to include it as your own assumption:
- Initial Marketing Spend Requirement (Item 6, p. 38) — Years 1-2 only: $60,000 then $75,000 of local marketing spend. It counts toward the Minimum Local Marketing Spending (greater of $50,000 or 8% of prior-year Gross Sales), which the franchisor only reserves the right to impose after this period - so apply this floor in years 1-2 instead of, not in addition to, the 8% entry. Materially above the $12,500-$30,000 Item 7 advertising line.
- ServiceTitan business management software license (per user) (Item 6, p. 38) — Requires a user-count assumption. Excluded from derived cost metrics while the Item 6 / Item 11 rates remain irreconcilable.
- Call Center Program Fee (Item 6, p. 33) — Modeled value covers only the $349.99-$449.99/month base fee. Item 6 also charges $25 per booked appointment on top, which isn't reflected in value/range_high because appointment volume isn't disclosed - treat the true cost as higher than the modeled range.
- Insurance (Item 7, p. 44) — Treated as a recurring annual premium range, but the period is an inference: the Item 7 line reads 'Lump sum or as arranged / As arranged' and the table is an initial-investment estimate, so the same dollars also sit in the Item 7 total. Do not count it twice against year 1.
Overlap control: Minimum License Fees is a floor on “License Fee” ($5,200/yr) — already exceeded at this revenue, so not an additional charge.
Every figure in this table is a model estimate built on the disclosed fee schedule plus labeled assumptions. Excluded: income taxes, owner draw, working-capital swings, capital expenditures, ramp-up losses in year one, one-time and per-event fees (transfer, renewal, audit), and the undisclosed-amount fees listed above. Read AUV vs. EBITDA vs. owner income before using this.
Sources and provenance
Primary source: 2026 Franchise Disclosure Document — Mr. Rooter SPV LLC · issued 2026-04-02. Find the FDD at Wisconsin Department of Financial Institutions — Franchise Registration Search. We cite source pages and do not redistribute PDFs.
View all sources, provenance and verification notes
| Document | Obtained from | Dates | Status |
|---|---|---|---|
| 2026 Franchise Disclosure Document — Mr. Rooter SPV LLC Registry file 640790 · 457 pages Cover page states 'Issuance Date: April 2, 2026'; no amendment date appears on the cover or receipts. Wisconsin registration effective 4/2/2026, status Registered. | Wisconsin Department of Financial Institutions — Franchise Registration Search | Issued 2026-04-02 Retrieved 2026-08-29 | Newest available at retrieval |
AI-assisted extraction from the archived FDD text, independently machine-verified against the cited source (two passes plus tie-break); not human-reviewed. Extracted 2026-08-29. Last updated 2026-09-05. AI-assisted extraction independently machine-verified against the cited source document (2026-08-31): two independent AI reading passes plus tie-break re-inspection of every disagreement; 74 of 77 material fields confirmed (68 with the exact page citation re-confirmed), 2 corrected, 0 unresolved, 3 confirmed not disclosed. No human has reviewed this profile. Fiscal year covered: FY2025 (Dec 31, 2025). See how we use AI and verify data.
Fields flagged as uncertain (4)
- investment.franchise_fee_high — no dollar ceiling is disclosed; Item 7's high cell reads '$42,500 + $425 per 1,000 additional population', so $42,500 is recorded and the surcharge left to the note.
- fees.local_marketing — recorded as 8% of prior-year Gross Sales; the disclosed obligation is the greater of that or $50,000 a year, with separate fixed amounts in the first two years.
- fees.cooperative — Item 6 caps local marketing group contributions at 3% of Gross Sales, says 2% currently goes to Neighborly brand initiatives, and also states there are no cooperatives at present.
- investment.alternative_formats[0].franchise_fee — $8,500 is the low-end private-equity development fee (10% of initial fees for two businesses), not a per-unit initial franchise fee.
Extraction notes (10)
- Item 7 high column arithmetic: the twelve high line items sum to $298,250, so the printed $298,675 total implies an initial franchise fee of $42,925 ($42,500 plus one $425 territory increment). The printed total is recorded unchanged.
- The private-equity Development Agreement table does not foot: $21,250 development fee plus $294,383 first-business cost equals $315,633, but the table's TOTALS row prints $315,250. The cover page states $315,633. The Item 7 table figure ($315,250) is recorded in alternative_formats.
- Item 1 states there were 3 affiliate-operated U.S. locations as of Dec 31, 2025, while Item 20 Table No. 4 shows 3 at the start of 2025 and 2 at year end after one Washington outlet was sold to a franchisee. The Item 20 year-end figure of 2 is used for units.company_owned.
- Item 19's count of 13 franchised businesses closing during 2025 reconciles exactly with Item 20 Table No. 3 for 2025 (11 terminations + 1 non-renewal + 1 ceased for other reasons).
- No minimum liquidity or net-worth requirement appears anywhere in the reviewed document; both are recorded as not_disclosed.
- Outlet counts cover the U.S. and Puerto Rico. Four UK franchised locations held under a master franchise relationship, reported in Item 1, are excluded from Item 20 and from units.
- Item 8 does not state what percentage of the franchisor's revenue comes from required franchisee purchases, so no figure is recorded.
- Verification 2026-08-31: correct /investment/franchise_fee_low 42500 → 43750
- Verification 2026-08-31: correct /investment/franchise_fee_high 42500 → 43750
- Verification 2026-08-31: fix_page /fees/local_marketing 31 → 38
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