ANAGO OF MINNEAPOLIS

Item 7 lays out an initial investment range of $12,750 to $68,250, starting with an $8,750 franchise fee—relatively low for cleaning services, where averages hover around $20,000-$40,000. But ongoing costs stack up aggressively: 10% gross sales royalty to Anago Franchising, Inc., plus a 6% administration fee to NTGY, Inc. (the subfranchisor), and 2% brand/ad fund, totaling 18%—well above the 8-12% category norm. No Item 19 earnings disclosure leaves a void; without validated revenue or profit data from the 45 existing units, buyers must rely on general cleaning industry benchmarks (often $100K-$500K annual revenue per unit) and personal due diligence to project viability.

Since franchising in 2013 from Edina, MN, this operation has grown to 45 locations but mirrors the parent Anago system's -2% contraction (1,830 units in 2023 to 1,791 in 2024). Projected new units of 12 suggest local optimism, yet the lack of Item 19 combined with high fees could squeeze thin margins typical in janitorial work (20-30% net profits industry-wide). For risk-tolerant investors eyeing semi-absentee models, the low entry barrier tempts, but the fee burden and growth stall warrant scrutinizing territory saturation and client retention before committing.