Does 1-800-GOT-JUNK? charge franchisees for items purchased from them, and if so, at what price?
1_800_Got_Junk Franchise · 2025 FDDAnswer from 2025 FDD Document
Occasionally franchisees are required to purchase certain items from us for use in the Franchised Business. We charge franchisees for such items at our cost and at times with a markup. We have in the past been an approved supplier for some items, but we are not currently an approved supplier of any items for use in the Franchised Business, and except for the Sales Center and CRM System neither are our affiliates. Our CEO, Brian Scudamore, owns an interest in our parent, Rubbish Boys, but otherwise, none of our officers own an interest in any of our suppliers.
We currently negotiate purchase arrangements with some suppliers for the benefit of our franchisees. We may receive rebates, promotional allowances, discounts or other payments or benefits from designated suppliers as a result of the purchases made by 1-800-GOT-JUNK? franchisees. Currently, the amount of payments are determined at the discretion of the suppliers, and are made in sponsorship of our annual conference. In our fiscal year ended December 31, 2024, certain suppliers made payments to us in the amount of $130,692 for such sponsorships.
If you lease your vehicle(s), the purchase and lease of items from approved suppliers or that meet our specifications represent approximately 10% to 30% of your total expenses in connection with the establishment of the Franchised Business, and approximately 40% to 50% of your total expenses in connection with the ongoing operation of the Franchised Business. If you purchase your vehicle(s), the purchase and lease of items from approved suppliers or that meet our specifications represent approximately 70% to 90% of your total expenses in connection with the establishment of the Franchised Business, and approximately 50% to 60% of your total expenses in connection with the ongoing operation of the Franchised Business.
There are no purchasing or distribution cooperatives.
We do not provide material benefits to you based solely on your use of designated or approved sources. 4899-8658-3815.1
ITEM 9.
Source: Item 8 — Restrictions on Sources of Products and Services (FDD pages 21–23)
What This Means (2025 FDD)
According to 1-800-GOT-JUNK?'s 2025 Franchise Disclosure Document, franchisees are occasionally required to purchase certain items directly from 1-800-GOT-JUNK? for use in their franchised business. When this occurs, 1-800-GOT-JUNK? charges franchisees their cost for the items, and sometimes includes a markup. As of the end of the fiscal year December 31, 2024, 1-800-GOT-JUNK? was not an approved supplier of any items for use in the franchised business, except for the Sales Center and CRM System.
Franchisees must purchase or lease certain items from 1-800-GOT-JUNK?'s approved suppliers or under their specifications, including the Sales Center and CRM System, trucks, truck dump bodies, signage, uniforms, marketing materials, tools, equipment, credit and debit card processing services, communications equipment, computers, and software. For some items, 1-800-GOT-JUNK? only provides the specifications, and it is the franchisee's responsibility to find suppliers that meet those specifications.
For franchisees who lease their vehicles, the purchase and lease of items from approved suppliers or that meet 1-800-GOT-JUNK?'s specifications represents approximately 10% to 30% of the total expenses in connection with establishing the franchise. It also accounts for approximately 40% to 50% of the total expenses in connection with the ongoing operation of the franchised business. For franchisees who purchase their vehicles, these purchases and leases represent approximately 70% to 90% of the total expenses in connection with establishing the franchise, and approximately 50% to 60% of the total expenses in connection with the ongoing operation of the franchised business.