Right Start Transfer Manual

Right Start Transfer Manual

MOLLY MAID, INC. December 1, 2014

Table of Contents 1.1

Entering the Right Start Program.......................................................................... 4 Getting Started ............................................................................................................. 5 Right Start Modules .................................................................................................... 5 Computer Hardware .................................................................................................. 6 1.5 Contact a Qualified Accountant and Lawyer...................................................... 6 1.5.1 Legal Organization of Your MOLLY MAID Business..................................................... 7 1.5.2 Apply for a Federal Employer Identification Number (E.I.N.) ................................ 9 1.5.3 Establish a Relationship with a Bank................................................................................ 9 1.6 Investigate and Secure Proper Insurance Coverage.....................................10 1.7 Yellow Pages ...............................................................................................................14 1.8 Familiarize Yourself with Your Territory ........................................................14 1.8.1 Site Selection/Office Location ...................................................................................15 1.9 Acquire Two Pre-Approved MOLLY MAID Vehicles ......................................15 1.10 Conduct a Telephone Search of Your Competition........................................16 1.11 Develop Your Financial Projections ...................................................................17 1.12 Marketing Your Business .......................................................................................18 1.12.1 Investigate Local Advertising Opportunities .........................................................18 1.12.2 Develop Your Marketing Plan ...................................................................................19 1.13 Contact State Agencies for Required Forms, Licenses, and Permits .......19 1.13.1 Contact City and County Governing Offices ...........................................................20 1.14 Have Your Telephone Service Installed ............................................................20 1.15 Getting Set Up on Email...........................................................................................21 1.16 Investigate and Develop Employee Recruitment Resources .....................22 1.16.1 Employee Referrals .....................................................................................................22 1.16.2 Community Recruiting Options ................................................................................22 1.16.3 Plan Your Strategy for Recruiting Home Service Professionals ........................25 1.16.4 Sample Recruitment Calendar ..................................................................................27 1.16.5 Begin Your Recruitment Effort Today ....................................................................28 1.17 Your MOLLY MAID Business Attire .....................................................................30 1.18 Set Up Your Office Space .........................................................................................31 1.19 Customer Care System Live Module and Workbook.....................................33 1.2 1.3 1.4

MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc.

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1.19.1 Computer Accounting Systems .................................................................................33 1.20 Required Informational Postings........................................................................34 1.20.1 Federal and State Postings ........................................................................................34 1.21 Ecolab will Install Your Cleaning Product Dispensing Unit ................. Error! Bookmark not defined. 1.22 Order Your Initial Package ....................................................................................34 1.23 Set Up Your Vehicle Maintenance Program .....................................................35 1.24 Establish a Relationship with a Local Urgent Care Center .........................36 1.25 Schedule Customer Advertising Distribution .................................................36 1.25.1 Schedule Employee Advertising ...............................................................................36 1.26 Watch the Molly Maid Cleaning Training DVD................................................36 2.1 What is Initial Training? .........................................................................................39 2.1.1 What is covered during Initial Training Week? ....................................................39 2.2 What to Bring With You ..........................................................................................39 2.2.1 Training Materials are provided for you ................................................................39 2.2.2 Materials You Need to Provide .................................................................................40 2.2.3 Attire for Initial Training Week ................................................................................40 3.1 MOLLY MAID Field Training at Owner Training Centers ............................42 3.2 Objectives and Areas of Focus ..............................................................................42 3.2.1 Objectives ......................................................................................................................42 3.2.2 Areas of Focus ..............................................................................................................42 4.1 Business Launch ...................................................... Error! Bookmark not defined. 4.2 Initial Field Visit ........................................................................................................46 4.3 MOLLY MAID Franchise Owner Support ...........................................................47

MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc.

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MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc.

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MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc. 1.1 Entering the Right Start Program Welcome to MOLLY MAID, the world leader in professional residential home cleaning service. The MOLLY MAID system has a proven track record, and in every case the degree of its success is directly related to the ability of MOLLY MAID franchise owners like you to dig in and get started. As you begin the Right Start program, we want to share with you our guiding beliefs. Many franchise owners have adopted these beliefs in their own businesses and found them to be valuable. We hope you feel the same way. MOLLY MAID Beliefs  Integrity, honesty, respect, and responsibility are the foundation of MOLLY MAID.  By serving others, we help them succeed.  Relationships matter.  Teamwork is vital to our success.  We lead through innovation and continuous improvement.  We care about our communities by getting involved.  We work hard and have fun! Starting a business, any business, is an exciting challenge. Successfully completing all phases of Right Start will help you prepare to launch your business as smoothly and quickly as possible. Its step-by-step design guides you through the first few months of your start-up and focuses your energies on maximizing the exciting opportunities that are available. The entire MOLLY MAID team looks forward to assisting you in getting off to a Right Start with your business. But don’t forget that its ultimate success depends on your ability and desire to achieve your objectives, and your commitment to make it happen. The Right Start program consists of three phases: Phase One: Business Set Up and Office Preparation (4-6 weeks) Phase Two: Initial Training Program at the Home Office (5 days) Phase Three: Owner Training Center at a successful Molly Maid business (5 days) This manual is your guide to completion of Phase One  preparation for Initial Training. During Phase One, you will read training materials, investigate your competition, interact with government agencies, find office space, negotiate leases, develop your financial plan, develop and place your marketing plan, and handle many other details necessary to start your business properly. To assist you in the start-up process, you will work with a New Business Manager, who is a part of the Right Start team. For the next several weeks, your New Business Manager will be your primary contact at the home office. Up through the three phases of Right Start, your New Business Manager will guide you through the preparation process and assist you in staying on track with the many tasks you must complete prior to launching your business. Your New Business Manager will help you set up a realistic plan to complete the preparation process for Initial Training and Owner Training Center and work right alongside you to help you achieve that goal. Proprietary and Confidential Information Page 4

MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc. During Initial Training week you will meet and spend time with your Franchise Consultant (FC). Your FC, a member of the operations team, will work with you in the launch of your business and assist you in the implementation of the MOLLY MAID system, growing your business to its full potential. An important key to successfully starting your business is to maintain good communication with MOLLY MAID and your New Business Manager. One of the first things you will do together is to set up a series of timelines for the many items to be completed. This will help you stay on track to attend the Initial Training class you are targeting and get your business launched. Phase One of Right Start generally takes four to eight weeks to complete. All requirements must be completed to the highest standards of quality. Many successful MOLLY MAID businesses have been launched in this fashion, and we are anxious to add yours to that growing number. The structure and effectiveness of Initial Training assumes that you have completed Phase One. 1.2 Getting Started Begin Phase One by reading the Right Start Manual and the Operations Manual. This will familiarize you with the business aspects of MOLLY MAID and the work that you need to complete prior to Initial Training. 1.3 Right Start Modules To be better prepared to launch your business, you are required to attend several live and pre- recorded modules. These modules are audio and audio-visual. You need your phone and for the audio-visual portion and a computer with an Internet connection. A description of each of the modules is below. Please consult with your New Business Manager to schedule the modules:  Introduction to Right Start (Live): The first module is Introduction to Right Start. This module allows you to learn what your New Business Manager’s role is throughout the Right Start process. Your New Business Manager will explain the Right Start process, what you can expect and what the Right Start team will expect of you. A timeline of the Phase 1 tasks will be reviewed.  Marketing Modules (Live): The marketing modules present a step-by-step process for creating the best marketing plan for your business. The steps included in the presentations are (1) researching your territory; (2) learning the MOLLY MAID marketing strategy, (3) investigating vendors, (4) creating an initial marketing plan, and (5) submitting the initial plan for consult with the MOLLY MAID marketing dept.  Quick Books (Live): A CPA with several years of QuickBooks and accounting experience hosts this module. You learn how to navigate through Quick Books and get a basic understanding of how to make entries into Quick Books using our required Chart of Accounts. Page 5 Proprietary and Confidential Information

 Lead Management System Module (Recorded): The Lead Management System (LMS) Tech Module gives you a step by step introduction to a software application designed and built internally by Molly Maid, Inc. to help you better manage your customer leads regardless of where the lead originated. LMS automatically receives leads for a specified franchise from the Molly Maid website through Requests for Service. It also allows you to manually enter leads as they come in from the phone and other sources. LMS allows you to track conversations and actions performed, send emails, generate reports and export the new customer to the Customer Care system. 1.4 Computer Hardware A solid working knowledge of personal computer use and Microsoft–based applications is part of a MOLLY MAID franchisee’s “professional toolbox” of business skills. You must be comfortable using your PC because our proprietary business management software, Lead Management and Customer Care, are an integral part of your business. The initial package includes one computer system pre-loaded with software shipped at your request. You may defer the delivery of your new computer until you have moved into your office. Please let your New Business Manager know when and where you would like it shipped. Many new franchisees prefer to have 2 computers (one for the owner and one for the Customer Service Representative). Check with your New Business Manager before you order a second computer to be sure you get one with the correct specifications to be compatible our system. 1.5 Contact a Qualified Accountant and Lawyer A qualified accountant and/or attorney will help you to determine the best legal and accounting forms under which your business should operate (i.e. incorporation or limited liability company) while counseling you on specific laws governing your particular area. You also need the services of an attorney to review, update and approve your Employee Agreements and Handbook and Safety Manual. Once your attorney has approved your documents, he or she must submit a written letter confirming approval of these documents to your NBM. After you've made a decision about your business form, you must determine two business names. The first is the name of your corporation or Limited Liability Company. You may not use MOLLY MAID in any corporate or limited liability company name . Next you need to establish your assumed name (typically referred to as your DBA for “doing business as”). Standard format for MOLLY MAID assumed names are “MOLLY MAID of ________” and should contain a descriptor of your geographical service area. Our team will offer some suggestions, based on your geographic area. Once you have received approval of your DBA from our Legal Department, you must file it with the state for approval.

MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc.

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MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc. The basic forms of operation in which business is conducted are: the corporation and the Limited Liability Company (LLC). Each has its own legal and tax characteristics that determine its relationship to the individual owner(s) and to society in general. Corporation A “C” Corporation (regular or tax-paying Corporation) is a separate legal and tax entity. Shareholder liability is generally limited to the amount contributed or paid for the stock. A regular corporation’s income is subject to “double taxation”: first at the corporate level and then to the shareholders when distributed as dividends. Major advantages are:  Limited liability  Continuous life  Tax advantages, in some cases The disadvantages are:  Relatively high cost of formation and administration  Relative lack of freedom  Double-taxation of income in some cases Subchapter S Corporation This is a regular corporation that elects to be treated by the IRS according to Subchapter S of the Internal Revenue Code. This form has many of the advantages of the corporation but is treated as a partnership or proprietorship for tax purposes (avoiding the double taxation problem). If an S corporation election is made, income (loss) is taxed directly to the shareholders since an S corporation is only a conduit for tax purposes. Regardless of its status (regular “C” or “Subchapter S”) for tax purposes, corporations provide shareholders with the advantages of limited liability and an independent legal existence apart from its owners. Limited Liability Company A limited liability company is a legal entity created under state law, although there r non-U.S. LLCs as well. The LLC is an entity separate f m i s ow ers. Proprietary and Confidential Information 1.5.1 Legal Organization of Your MOLLY MAID Business One of the first things to consider at the outset of starting your business is the legal form under which it will operate. Confer with your legal and accounting advisors for guidance. Ultimately, you and your business advisors must choose the appropriate legal form for the business to meet your needs. The two primary issues involved in deciding which type of entity to choose are: 1. Liability for the actions and debts of the business. 2. Taxation of the business. Page 7

The advantages are: 

It allows complete pass-through tax advantages  Operational flexibility of a partnership  Corporation-style limited liability (under state law)  Because of the newness of LLCs, many issues are yet unsettled  Some states do not sanction LLCs  There are restrictions on transferring membership interests

Management participation by all members The disadvantages are: 

LIMITED LIABILITY COMPANY (LLC)

TOPIC

CORPORATION (“C” or “subchapter S”) The business and its stockholders-owners are separate entities. The business is a legal unit unto itself, capable of acting in its own name and right. Business and personal assets are entirely separate. Limited to any unpaid stock subscription liabilities in absence of fraud or other special circumstances. By consent and authorization of state law after compliance with the formalities. Shared indirectly through dividends declared by directors out of profits and apportioned among the outstanding shares of stock. A “regular” corporation pays tax on its income as a separate tax-paying entity. S corporation taxable income (loss) is apportioned among its shareholders.

The business and its stockholders-owners are separate entities. The business is a legal unit unto itself, capable of acting in its own name and right. Business and personal assets are entirely separate. No personal liability, in absence of fraud or other special considerations. By filing Articles of Organization with the applicable Secretary of State, then an ownership agreement. Members determine how profits and losses will be distributed. An LLC is not a separate, tax- paying entity; it provides pass-through tax treatment to owners.

Relationship of Owner to Business

Liability of Owner for Firm Debts

Creation and Organization

Sharing of Profits

Taxation

Perpetual, unless limited by terms of charter, by-laws, or Perpetual, unless limited by terms of Articles.

Period of Life

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statute.

MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc. . It is always important to develop a relationship with your banker. By sharing your business plan and/or financial projections with your banker, he/she will be aware of your business progress and accomplishments. This will be to your benefit as your business grows. Ask the bank for starter checks . These will be helpful in case of any printing delays or depletions of your supply. Your Initial Package includes MOLLY MAID checks and deposit slips, so it is not necessary for you to purchase them from your bank. Fax a voided starter check, along with your New Owner Information Form, (on the MOLLY MAID Team Site,) to your New Business Manager. It will be used for placing your check order and setting up your Electronic Funds Transfers (EFT). You may write “void” on a post-it note, put it on the check and fax/email it to your New Business Manager and have use of the check. Proprietary and Confidential Information Effect of Death of Owner Business continues its independent legal existence with the deceased owner’s interest passing to estate and heirs. 1.5.2 Apply for a Federal Employer Identification Number (E.I.N.) To apply, submit Form SS-4 to the Internal Revenue Service. This form may be obtained from your local IRS office or you may download it from the Internet, at www.irs.gov . Obtain a business tax kit, containing forms and instructions for meeting federal reporting and tax deposit requirements. To expedite the process, after you've filled out Form SS-4 you may call the national number for the IRS office (800) 829-3676 to find the IRS headquarters in your area. They will ask you for some of the information requested on the form and give you an EIN right over the phone. They will still need Form SS-4 filled out and sent to them. If you are incorporating, your attorney or accountant can apply for you. 1.5.3 Establish a Relationship with a Bank Find a full-service bank with a convenient location and hours for your business account. Develop a relationship with the bank branch manager. The closer the relationship you develop, the better your chances of establishing credibility and obtaining a loan or special considerations as future needs arise.  If incorporated, you will need from your attorney: Articles of Incorporation and Resolution with By-laws. From the Secretary of State, you should obtain a certificate of assumed name (or DBA - “Doing Business As”). These items can take some time, therefore, prepare ahead of time, if possible.  If set up as an LLC, you will need the title of your company, EIN, and identification for all signors on the account. NOTE: Most owners find it helpful to list their DBA name on their checks rather than the name of their LLC. Some include both . Share your business plan with your banker Business continues its independent legal existence with the deceased stockholder’s shares passing to estate and heirs. Page 9

You should receive your personalized business checks about ten days after you place the order. 1.6 Investigate and Secure Proper Insurance Coverage We strongly recommend the MOLLY MAID national insurance program and encourage you to consider it for your coverage needs. Our two preferred vendors listed below: WEST Insurance-Geoff Raef (847) 623-0456 These programs include all required coverage and several enhancements not usually offered in “mono-line” policies. The enhancements are directed specifically at potential risks associated with MOLLY MAID businesses. Among those coverage/enhancements are: employee dishonesty, completed operations, monthly payments, one-stop shopping, exceptionally competitive rates, pre-approved underwriting for new business owners, listing Molly Maid, Inc. as an additional insured, and coverage requirements that meet MOLLY MAID minimum levels. Listed below are some of the benefits of the program:  Includes all the required coverage in accordance with your franchise agreement.  Includes additional coverage not included in standard individual policies.  Is extremely competitive in most markets.  Can be supplemented with additional coverage.  Perhaps most valuable, the insurance carrier has had extensive experience working with MOLLY MAID owners and is familiar with our type of business and its challenges. If you choose to obtain competitive bids, and we do recommend that you get three bids, make sure they include the minimum requirements. The minimum coverage requirements are listed in your Franchise Disclosure Document (FDD) and are also listed within the information listed below, in bold. Have the quotes broken down sufficiently for you to use the worksheets found on the MOLLY MAID Team web site to compare rates. Remember that Molly Maid, Inc. must be listed as an additional insured. Ultimately, the agent must be able to convince the underwriter, who controls the terms and conditions of the quote. You can find a letter on the MOLLY MAID Team web site to use when you contact the insurance agents. There are six types of insurance that you will need to protect you, your business, your employees, your customers, and Molly Maid, Inc. Have the agency representative for the MOLLY MAID insurance program explain the additional benefits of the program in meeting/exceeding the minimum requirements that follow:

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MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc. General Liability Insurance This insurance provides liability coverage for bodily injury and property damage. It is usually based upon a certain percentage of employee payroll. It should be higher if your legal counsel recommends it. MOLLY MAID Requirements: Coverage for “bodily injury,” “property damage,” and “personal and advertising injury”, with no exclusion or limitation applying to the products / completed operations liability coverage. Limits must be at least $2,000,000 general aggregate, $2,000,000 products and completed operations aggregate, $1,000,000 personal and advertising injury limit and $1,000,000 per occurrence limit. Contractual liability coverage including the assumed personal injury endorsement must be included to cover the indemnity provisions of the Franchise Agreement. The exclusion for employer’s liability shall not apply to claims for covered contractually assumed liability claims. Such policy shall contain a waiver of subrogation endorsement as to claims against Molly Maid, Inc. Molly Maid, Inc., shall be named as an additional insured on this policy on a primary and noncontributory basis, and with a Grantor of Franchise Form CG2029 or an insurer’s comparable form. The premiums are based on:  Coverage limits.  Deductible amounts.  Estimate of annual payroll (or sales). Use the figures from your financial projections. It is important to be as accurate as possible because this will have an impact on your cash flow.  Classification(s) of work activities. Be sure you are quoted in the correct risk classification .  Experience factor.  Imputed salary of owner (try to waive). If you chose not to go with our national insurance program and obtain insurance locally, there are several important factors that you should make your agent aware of to reduce your premiums. You will be more effective if you discuss this with your agent in person. Inform your agent that:  You have a formal training program for all employees.  That there is a limited range of work your employees perform. You do not provide every service associated with house cleaning.  You have a formal safety program.  You evaluate the customer’s home during the in-home estimate before agreeing to provide service. Be sure to include “finished products and services” or “completed operations” coverage. This is coverage that protects you in case a customer is injured in their home or incurs damage as a result of something that is associated with the actions of your HSPs.

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An annual audit is conducted to verify actual payroll figures and adjustments are made for under- or over-payment of premiums. These audits are usually done by mail, but may be done by a pre-scheduled personal visit by an insurance company auditor. Umbrella Insurance:  You shall maintain a commercial umbrella liability insurance policy with a limit of at least $1,000,000 per occurrence and aggregate shall list the commercial general liability, automobile liability and workers’ compensation/employers’ liability policies as scheduled underlying policies. Automobile Insurance  You shall maintain insurance with a combined single limit, CSL, of $1,000,000 for bodily injury and property damage for all owned or leased vehicles and include a hired and non-owned endorsement. Additionally, uninsured motorist and under-insured motorist coverage will be equal to the CSL. The insurance coverage must not have a deductible or self-insured retention greater than $5,000. There are several favorable factors that will help to lower your premiums. Make your agent aware that:  You hire mature people who take their job seriously and are responsible.  The majority of your employees are women who statistically are proven to be better drivers.  There is an assigned driver for each car - not just any employee can drive any car.  There is an employment agreement that explains the responsibilities of the employee while in possession of the car and a violation jeopardizes their job.  You (the business owner) inspect cars weekly - when HSPs don’t expect it.  You have a maintenance program on all cars.  You have safety restrictions - no one else drives the car (no husbands, boyfriends, etc.).  The cars are only used Monday through Friday, between 8:00 a.m. and 5:00 p.m. and only driven between customers’ homes.  The cars are left at the office (according to your company policy).  The cars typically go to 4 houses per day and spend most of their time parked.  The cars are rarely parked on the street. The value of the car will have a determining factor in the cost of insurance. Cars should be basic: automatic transmission, air conditioning, and a radio. Different deductible amounts for comprehensive and collision coverage will affect the cost of premiums. Wh n comparing auto insurance quotes make sure that the Property Damage and Bodily Injury coverage and deductibles are consistent from quote to quote.

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MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc. Workers Compensation Insurance Although Workers Compensation and Employer’s Liability Insurance is mandated in most (not all) states, it is a required coverage for every MOLLY MAID business, even if not a state mandate. It is a no-fault agreement between the employee and employer. The employee gives up the right to sue the employer for lost work time and medical costs. The employer gives up the right to claim there was contributory negligence on the part of the employee in work-related illness or injury. Statutorily required workers’ compensation insurance and employer’s liability insurance shall be maintained with limits of at least $500,000 by accident, $500,000 by disease and $500,000 policy limit. In “Monopolistic States”, such as Ohio, North Dakota, Washington, Wyoming and West Virginia “Stop Gap” coverage must be purchased separately or added to the CGL policy. “Stop Gap” in Ohio must not contain exclusion with the "substantially certain to occur" language. Workers Compensation and Employers Liability is required. Premiums for this type of insurance are based upon:  An estimated payroll from a realistic financial projection. They are quoted as a rate per $100 payroll. For example, if you estimate your payroll total for a year to be $100,000 and your Worker’s Compensation rate is $6.00/$100 payroll, your cost would be $6 x 1,000 or $6,000. It is important not to understate the payroll. If you do, you will receive a large assessment at the end of the year. Likewise, it is important not to overstate the payroll. This results in a cash drain. Policies are audited every year, usually by letter. If they are done in person, you will need to provide 941’s, W-3 form or other payroll records.  Classification - Usually the classification is “Inside Residential House Cleaning” and the code is 0917. This may vary in some areas. In California, it is classified as 9096 (Residential Cleaning) and NOT 9008 (Janitorial). A PEO, Professional Employer Organization, should be able to help with the appropriate classification. It is important that your agent be aware that, even though the team leader does have several responsibilities (i.e., collecting payments, driving, and cleaning) most of their time is spent cleaning.  A rating plan which is derived from a claims history. Generally, rates are established and fixed by your state, in accordance with the National Council on Compensation Insurance (NCCI) guidelines. Some states retain their own jurisdiction regarding classification. 1. Bonding Insurance You shall maintain employee dishonesty insurance with minimum limits of $25,000 per loss and such coverage shall also cover acts of stealing against third parties. Minimum limit $25,000 per loss.  Your agent should be made aware that your employees don’t normally handle large amounts of cash. Proprietary and Confidential Information Page 13

 If a theft occurs, immediately contact your insurance agent for advice. In all cases, in order for the claims process to begin, the customer must file a police report and pursue the matter. 2. Employment Practices Liability Insurance (EPLI): Non-required supplemental Insurance covering items such as sexual harassment. 1.7 Yellow Pages As purchasing habits continue to evolve, the Yellow Pages still remains a marketing vehicle for the MOLLY MAID business. Contact both your local phone book publisher(s) and our national Yellow Page advertising placement service for assistance in determining the closing date on the next printing of the telephone book. Use the information you receive to determine the best placement for your phone book advertising in your area. Our national Yellow Pages placement service can give you information on highest percentage of readership that will be an important factor in your placement decision. Be aware that the minimum requirement for your Yellow Pages advertising outlined in your Franchise Agreement is a trademark listing in your primary Yellow Pages book. Give the national Yellow Pages advertising service the name of the telephone directory that you'll want to use for your Yellow Pages advertising. If there is more than one telephone directory used in your area, consult with your New Business Manager on which one(s) to use. In some cases, you may be able to share costs with other proximate MOLLY MAID franchise owners. 1.8 Familiarize Yourself with Your Territory Drive through your territory and familiarize yourself with the best potential areas for employees and customers. Both of these factors play an important role in the consistent growth of your business. Most MOLLY MAID territories have a balance of newer and more established areas. This balance is important in developing plans for recruiting both customers and employees. Make yourself aware of locations where advertising materials for customers can be left behind, i.e. dry cleaners, day care centers, realtors, hairdressers, etc. Also watch for good locations where potential HSPs might frequent. Laundromats, grocery stores, apartment complex leasing offices, convenience stores, churches, community centers, etc., are possibilities where you can hand out or leave behind employment opportunity posters and business cards. Familiarize yourself with local business owner networking groups and inquire about membership fees in your local Chamber of Commerce. Joining the Chamber of Commerce provides an excellent opportunity to network with other area business owners and take advantage of Chamber sponsored events that are helpful and educational for a new business in the are .

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1.8.1 Office Location Find a mutually agreed upon time for you and the seller to meet at the office. You can assess the space and make sure it includes the following:  Your office must be located within your protected territory.  Be aware that your office location should be close to your largest employee base.  Selecting an office location convenient for your employees. Some employees may use public transportation and some will drive or get a ride to work.  Adequate and safe parking to accommodate future growth.  Access to major traffic arteries.  Lease terms and conditions, in particular: o Rent o Duration of lease: short-term (1-2 year) leases are recommended at the start of your business. You will need more space as the business grows. o Ancillary expenses: taxes, utilities, common area o Required/permissible signage o Required insurance coverage o Timely occupancy to permit business phone installation  Adequate space (750 - 1000 square feet for a start-up) for office, supplies, storage, etc.  Cost of necessary leasehold improvements to accommodate your MOLLY MAID business (i.e. wall partitions, water line, etc.)  A source of running water for the installation of the dilution and dispensing system for your cleaning products, preferably in your office.  Washer and Dryer hook ups  Convenience of restroom facilities. 1.9 MOLLY MAID Vehicles 1.9.1 Taking Over the Payments/Leases of the MOLLY MAID Cars? Discuss with the previous owner what needs to be done to transfer titles or reassign existing leases for the MOLLY MAID vehicles. An escrow arrangement will ensure that both parties participate fully to effect vehicle transfers. Find out how to go about transferring any warranties or service agreements. Also determine if the insurance is transferable. If so, are the rates and limits consistent with the

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MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc. If you are debating whether to lease or purchase your vehicles, you can find a document on the MOLLY MAID TeamWeb site with the Right Start documents and forms that discusses the aspects of each. 1.10 Conduct a Telephone Search of Your Competition Search online under “Housecleaning” or “Maid Service,” and survey the competition in your area. Call or email them and inquire about their service. If they do in-home estimates, have them come out to do one in your home. You will want to determine:  What price they charge?  Is an estimate conducted in the home? (Use this question only if you are asking over the phone, not in the home.)  Is there an hourly or per service charge?  What is their hourly charging rate?  Do they require a contract to secure specific pricing? Proprietary and Confidential Information required coverage? Contact our representative from Enterprise if the vehicles were obtained through them. Inspect and evaluate the condition of the cars for safety. Does each car have a record of maintenance performed on the car? What are the lease residual values? Who will receive the lease deposit when the car is turned in? Do the team leaders take the cars home or are they parked at the office at night? Personal use of the vehicles by the home service professionals is tied into employee compensation. Discuss this with your new business manager. If you need to lease or purchase additional marketing/service vehicles, look on the MOLLY MAID Team Web site for the pre-approved list, or talk to your new business manager. (This list changes annually as models and colors change.) As part of your process of vehicle acquisition, contact your Department of Motor Vehicles to determine the appropriate classification for license plates. In the majority of states, MOLLY MAID vehicles do not require commercial license plates. Make sure to verify and obtain the proper classification for your location. Each franchise owner must provide approved vehicles for their teams. The cars can be new or used, must have a professional appearance, and must be identified by approved MOLLY MAID logos. (Instructions for applying the logos are located on the MOLLY MAID Team web site.) You are responsible for purchasing or leasing additional vehicles as each team is established. Your vehicles must be dark blue subcompacts. Our official MOLLY MAID color is reflex blue, but the colors readily available are usually described as “navy” blue or “dark” blue. As a convenience to your employees, we recommend you equip your cars with air conditioning, power steering, automatic transmission, and a radio. Page 16

MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc. 1.11 Develop Your Financial Projections The number one reason for business failure is under-capitalization. You must develop a solid realism concerning your finances. The successful launch of your MOLLY MAID business must include your preparation and in-depth understanding of a comprehensive, pro-forma, financial projection. During Phase One of Right Start, your New Business Manager will assist you in understanding typical expenses, percentages, and operational performance information, however, you must supply the required information specific to your business. This is one of the most crucial aspects of Phase One in Right Start, and we take it very seriously. There are two key time line checkpoints regarding this Right Start task. Checkpoint #1: Approved preliminary projection prior to any contractual agreements You must have preliminary financial projections in place prior to entering ANY contractual agreements. Signing an office or vehicle lease/purchase contracts would not be wise without knowing what your budget will afford for these two areas. Work with your New Business Manager to develop your preliminary financial projections – you will fine-tune the plan once you conduct all of your research. The template for the financial projection can be found on the thumb drive that was included with your Right Start package. Developing the financial projection assumes a basic knowledge of working in Microsoft Excel. It is important to complete preliminary financial projections right away to get a solid understanding of the working capital requirements. This is an important consideration as you evaluate office rent and automobile lease/ purchase payments. If your financial projection shows that additional outside investment is or may be needed, develop a full business plan. Most lenders are reluctant t loan working capital to service Page 17 Proprietary and Confidential Information   How many service people are sent out?  Do they provide insurance and bonding for their employees? What types?  What services do they provide?  What areas of your territory do they service?  How long have they been in business?  How many employees do they have?  What discounts do they offer? The information you learn about competitors will allow you to emphasize the advantage and benefits that potential customers will receive from MOLLY MAID service. This will be particularly useful information during in-home estimates. Continue to check your competition periodically, after starting your business, to see if there are any changes in the way that they do business. Do they charge for an initial clean?

MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc. 1.12 Marketing Your Business Marketing is essential to the continued growth of your business. It is an ongoing investment to drive revenue, not just an expense. To begin the marketing planning process, your New Business Manager will schedule a series of phone calls with you and the MOLLY MAID Marketing Manager. The live modules will describe Molly Maid’s marketing strategy, vendor partners, marketing tracking and analysis. The information within these presentations will help you ask the right questions as you start to investigate different marketing vehicles in your area. 1.12.1 Investigate Local Advertising Opportunities Once you’ve completed the second live marketing module with MOLLY MAID Marketing Manager, the next step in the marketing planning process is to contact the recommended vendor partners to determine if there is coverage in your area. It is important to have a mix of both online and offline advertisers. There are many advertising vendors available in the marketplace, however it is recommended to begin with preferred Molly Maid vendor partners for the following reasons:  Vetted, tested and proven successful  Streamlined program and pricing  Dedicated account service representatives  Approved Molly Maid artwork  National reporting and sharing of best practices Contact each recommended partner to verify coverage, cost and distribution schedule. You will need all of this information in order to construct your marketing plan. Proprietary and Confidential Information businesses unless prior arrangements for a business loan or line of credit have been made. The lending institution may require a full business plan. Checkpoint #2: Approval of Final Financial Projections Incorporate the specifics of your business (payroll taxes, office lease, vehicle lease/purchase payments, etc.) into your financial projections as you continue through Right Star . Your plan must ensure that growth and expense projections are realistic and will accurately reflect cash flow for your first two years in business. To qualify for entry into the Initial Training class, you must submit your final financial projections to the Home Office for approval at least 1 week prior to Initial Training. Your plan will be reviewed and approved by your New Business Manager and your Franchise Consultant. Do not schedule air travel to the home office training if you can’t have the final plan finished on this time line. Page 18

A marketing vendor list is included on the thumb drive that was sent with your Right Start package. If you work with suppliers other than those listed on the approved vendor list , be aware that you must have all marketing pieces approved by us prior to distribution. Research advertising sources, but DO NOT launch anything until after your first week of business. Check with the seller to see what marketing is in place. 1.12.2 Develop Your Marketing Plan Your Marketing Plan will be a visual marketing calendar for all advertising activities for the first year of operation. Molly Maid provides a Marketing Plan Spreadsheet in Microsoft Excel. Plan to complete 12 months of the marketing planner, but realize you will likely make adjustments after the first 6 months. The template for the plan and instructions are found on the thumb drive included with your Right Start package. Your New Business Manager can assist you in preparing your plan. Your final marketing plan must be pproved one week prior to Initial Training . Your marketing plan must be developed in conjunction with your financial projection. In order to maximize your growth and profitability, you must allocate the proper advertising budget based on your territory. Of course, this may vary depending on your growth goals. In new or fringe market areas, the marketing investment may be higher in order to build awareness of the benefits of the service as well as building the MOLLY MAID brand. In order to reach as many households as possible, you must use different marketing media. The most important things to remember are:  Frequency – have advertising planned 3 out of the 4 weeks a month  Consistency – make sure you remain with an advertising vehicle for 6-8 months before assessing  Reach – have a plan that includes a good media mix online and offline and in all categories of Foundation, Acquisition and Leverage Plan to invest between $2,000 and $5,000 per month on marketing during the first year. 1.13 Contact State Agencies for Required Forms, Licenses, and Permits Apply for your State Tax Identification Number , if needed, and any withholding tax forms and tables at the State Treasury Department. If your state has a sales tax on services, apply for a Sales Tax Permit and gather the Sales Tax Tables.

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Contact the State Employment Commission for unemployment liability forms. For example, in Michigan that would be the Michigan Employment Relations Commission (MERC). Be sure to check if there are any other permits or licenses you will need.  Examples of governmental offices in the state of California: Employment Development Department (EDD) - Unemployment Insurance - Disability Insurance - Employment Training Fund - Personal Income Tax Withholding  Examples of governmental offices in the state of Michigan: Department of Treasury - Personal Income Tax Withholding - Single Business Tax  Employment Relations Commission - Unemployment Insurance This information can be readily obtained on your state’s local website. If you are incorporating, your attorney or accountant can apply for you. 1.13.1 Contact City and County Governing Offices Does your municipality levy an income tax? Additional sales tax? Does your municipality require permits or licenses? If yes, you need to obtain all necessary forms for submission. What are the requirements to register your assumed name (your DBA, “Doing Business As”)? Check with local city offices to determine whether you need permits to distribute door hangers or advertisements. Ask your advisors (attorney or accountant) about any other requirements . 1.14 Telephone Service 1.14.1 Using the Established Business Phone Number? To do so, the previous owner must formally relinquish the rights to the business number to affect a transfer to you. Be aware that the information on the installation work order for the white pages listing dictates how the future yellow pages information will be printed. If you do not wish to have your address printed in the listing you need to request that at the time of the work order for scheduling installation. If you will not be suing the existing phone number, arrange with the phone company to have call forwarding put on the current phone number. That will allow the calls to be

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MOLLY MAID Right Start Transfer Manual Copyright  2015, Molly Maid, Inc. : Perceptionist is the company that MOLLY MAID uses for the National Call Center. The Call Center will provide a way for the Franchisee to capture 100% of the sales opportunities by providing backup telephone support during the day and into the evenings and weekends. Instead of letting unanswered calls go to voicemail, your calls will be re- directed to Perceptionist. Perceptionist’s goal is to book estimates and schedule one time cleanings for the Franchisees. To begin using Perceptionist, you will need to contact Perceptionist, at 866-652- 5968 . They will schedule a telephone interview which will last about an hour. During this call you will complete three things: 1 ). the specifics of your Franchise. You will need to have available the list of zip codes serviced and the name and number of your phone company. 2). Training on their calendar and Customer Center, both of which are web-based. 3). Necessary changes to your phone service. 1.15 Getting Set Up on Email Email is an important avenue of communication at MOLLY MAID. At the home office, we use email to pass on import nt i formation updates to our f anchise owners. As an added Page 21 Proprietary and Confidential Information forwarded to your new numbers. The telephone company will not guarantee a new number until it has been installed and the line is functional. Review the following section for information on suggested phone system specification. High Speed Internet : You will be able to access the MOLLY MAID Team Web site and send or receive faxes and email without tying up a phone line. Telephone : (2) two-line phone is recommended to start with. We recommend also using a hands free headset as well. These can be purchased at your local office supply store. If you will be using a “message on hold” system, you should purchase a telephone with this capability. (See next paragraph.) Message on Hold : Call the representative from Message on Hold on the MOLLY MAID Approved Suppliers’ Phone List for details. This is a professionally recorded MOLLY MAID message. The supplier will give you information on purchasing a compatible telephone and CD player. Voice Mail : With this option, you can have either line answered at any time. Check with your phone company to evaluate the services they offer. Some phone companies are now offering more than one message—so you could have one for working hours and one for after hours and weekends. The call center also offers a free voice mail option. Cell Phones : Many owners use cell phones to communicate with their staff while they are out of the office. You may consider this option for yourself; however, there are several important considerations. The first and foremost consideration is driving safety. Automobile accidents are continuing to increase when a driver has been distracted from driving because they are talking on their cell phone. If you consider using a cell phone in your business, please do not use it while you are driving. Perceptionist