CertaPro Painters Franchise Sucks - CertaPro Franchise Sucks - CertaPro Complaints
This website is in no way associated with CertaPro Painters or any companies affiliated with CertaPro Painters
This website exists to provide information to the public about the CertaPro Painters franchise.

Contents are personal opinion and based on personal experience .


Buying A Franchise:
"Be Your Own Boss"

Home The Myths FDD Franchise Agreement
How Much Do Certapro Franchisees Make? High Franchisee Failure Rate
Where Are They Now Lawsuits Lies The Gag Agreement Contact
Here's an alternative to that unbelievably expensive painting franchise

"Buy a franchise and be your own boss!"
You often read that in articles about buying a franchise.

The fact is that in many respects
you WON'T be your own boss.

And if there are problems or disagreements?
Chances are good that the franchise agreement
imposes severe constraints on you
and favors the franchisor.

Here are some examples of restrictions placed on a CertaPro franchisee, from CertaPro's 2011 franchise agreement.

(Note: In some cases, I have summarized or paraphrased. If you are considering buying a CertaPro franchise, take the franchise agreement to a lawyer to have it reviewed and explained to you.)

The numbers reference a section or subsection of the franchise agreement.

You're paying a bundle:
2.1 Franchise fee: $52,500
This is just the franchise fee. You may spend as much as another $100,000 or more for business expenses.

5% of all GROSS goes to CertaPro:
Even if you make little or no money, CertaPro always gets 5% of the gross.
2.2 Royalty: 5% of gross sales.

Minimum Royalty:
2.3 Minimum royalty fee (first two years):
$22,500 for first full year in business (=$450,000 gross) if contract signed January through May.
E.g., contract signed during first six months of 2012, minimum franchise fee due Dec. 31, 2013.
If signed June through December, $22,500 minimum due at the end of second full year in business.
E.g., contract signed during last six months of 2012, minimum franchise fee due Dec. 31, 2014.
Next year ("2nd calendar year"): $22,500 (=$450,000 gross).

6.1: 3rd-5th calendar year: $500,000 gross minimum. (5% = $25,000)
6th-10th calendar year: $650,000 gross minimum. (5% = $32,500)
If not attained, franchisee WILL BE IN BREACH OF THIS AGREEMENT.

2.4 Late payment of royalty: 1-1/2 percent monthly interest

2.8 Software Upgrade Fee:
0.25% of gross sales
($450,000 gross = $1,125 per year, $650,000 gross = $1,625 per year)

2.9 Software support fee:
No charge BUT Certapro can charge a fee, if it decides to, after giving you 60 days notice.

2.10 Answering service:
No charge BUT Certapro can charge a fee, if it decides to, after giving you 60 days notice.

11.2.2 Minimum Advertising:
First year: Must spend 12% of gross on local advertising.
(Example: $350,000 gross = $42,000 on local advertising.)
If you don't, Certpro can demand you pay difference between that 12% and what was actually spent to Certapro's General Advertising Fund.

4.3 Operating Assistance (Summarized/paraphrased):
Will CertaPro help you?
You can ask Certapro for assistance with the operation of the business but it's up to Certapro to decide whether or not to provide it. Certapro may provide advice and guidance about operation of business. Certapro can decide if it's "reasonably required" for the operation of the business.

5.2 Types of Vehicles:
Must be the make, model, and year decided by Certapro.
Vehicle logos, signs: Must use only Certapro-approved logos and signs. (Note: Certapro may still require vehicle be "wrapped". This is expensive. I don't know current cost, but I believe it was about $1,600 or more per vehicle.)

4.1 Initial training:
You pay for all transportation, meals, lodging.

4.2 (Additional training -- maybe -- and you pay):
"Mandatory In-Term Training" Additional training may be provided. If so, you must attend. A "reaonable fee" will be charged. You pay for all transporation, meals, lodging, and any wages for people you may bring along.

6.2.5 Certapro can tell you to attend training or retraining at location of its choice. You pay for all costs, transportation, meals, lodging, and wages to Certapro's staff.

6.2.3 Certapro decides what services and products you can sell/provide.

6.2.7 Comply with "quality and performance standards" determined by Certapro. Franchise advisory committee might have some input, but Certapro can ignore recommendations of the franchise advisory committee.

6.3 Must use approved Certapro suppliers:
(Note: Certapro gets a kickback from "approved suppliers"--perhaps as much as nearly $2 million per year.)
If you can't obtain materials from approved suppliers in a timely manner, you can't hold Certapro responsible for damages to your business.

6.4 If Certapro changes name(s), products or techniques, you must implement them at your own cost. If you refuse to do so, Certapro can "rectify such failure" and make you pay for the cost.

6.5 The phone number you use for the business belongs to Certapro.

6.6 Certapro must approve all materials bearing Certapro identification (if they're not from "approved suppliers").

6.7 Certapro decides what the warranty is, and you're responsible for taking care of all warranty work. You might find yourself competing with other painters who offer a longer warranty -- but you can't change yours to meet theirs.

6.8 You must allow Certapro access to your bank accounts so they can transfer money you owe Certapro directly transferred to Certapro. You pay for any transfer fees.

6.9 Certapro can "inspect" your business, including access to your computer(s) "and all programs and databases contained thereon".

6.10 Certapro owns your customer list if it's on Certapro's computer system (used for keeping track of jobs) or e-mail system. Certapro can use the data for any purpose. You'll spend a lot of money and time to get those customers -- and CertaPro will own the customer list.

8.1 You can't give other people customer information or the names of other franchisees or "know-how" made available by Certapro, including drawings, materials and oter data "which Certa Pro desginates as confidential".

9.5 If Certapro changes logo or "proprietary marks", the franchisee must make changes and bear the cost of making changes to vehicle logo(s), stationary, etc.

10.2 Three-year non-compete:
If you leave CertaPro, you can't operate a painting business within a 20 -mile radius of a Certapro franchise (or territory that somebody's considering buying). You can't solicit your former Certapro customers. You can't work for another painting franchise business. The non- compete clause applies to your business partner(s), family members and employees.

10.3 You must obtain a non-compete agreement from partners, officers, directors, members of your immediate family and employees.

11.1.2 You pay 3% of gross sales to Certapro's General Advertising Fund:
Certapro decides how to spend this money and where.

11.2.1 You must have a yellow pages ad (size determined by Certapro). [Personal note: When I ran a business-card size ad in the yellow pages, it cost me $300 per month. The yellow pages are becoming obsolete--people use the web now.]

11.2.1 You must spend 6% of your gross sales (12% first year) on local advertising:
[Example: $350,000 gross = spend $42,000 in first year.]

11.3 Marketing and advertising material must be approved by Certapro.

12.1 Bookkeeping and accounting must be according to Certapro terms and using systems approved by Certapro. You must pay any associated costs.

12.2 You must maintain business records (such as all work performed) and Certapro can inspect your business records.

12.3 You must submit monthly reports, annual records, and Certapro can demand a copy of your federal and state tax returns.

12.4 Certapro can conduct an inspection and audit of your books and payroll records. If an underpayment is discovered, you must pay it (1-1/2% per month interest). Certpro may be able to revoke your franchise for under-reported gross sales.

12.6 You agree to allow Certapro to contact your bankers, suppliers, and other trade creditors to make inquiries of them. You agree to allow Certapro to obtain copies of some documents from them.

13.1.1 You must obtain workers comp. insurance and include "waiver of subrogation" clause in favor of Certapro.

13.1.2 You must have minimum auto insurance in the amount specified by Certapro.

13.1.3 You must have $2 million liability insurance. Certapro must be named as an additional insured.

13.2 If you don't have required insurance, Certapro can obtain it and bill you for it.

13.3 Subcontractors must have insurance (the same types of insurance required of franchisee).
[Note: In my opinion and experience t's highly unlikely you'll find a subcontractor with that kind of insurance -- especially workers' comp. and a $2 million liability policy.]

14 If you sell your franchise, Certapro must agree, and any outstanding debt to Certapro must be paid.

14.2 If someone makes an offer to buy your franchise, Certapro has the right to buy it instead at the same price (right of first refusal).

16.4 Certapro can terminate your franchise for many reasons (see subsections of 16.4).

Your Legal Rights (ha)

CertaPro SEVERELY restricts your legal rights
(sections 18, 19, 20)

18.1.1 Mediation required for disputes, at Certapro's office in Oaks, Pennsylvania. However, Certapro may have the right to NOT participate in mediation if related to some violations by franchisee.

18.2 If mediation doesn't resolve a dispute, you must use abribration (no court lawsuits), according to Commercial Arbitration Rules of the American Arbitration Association. Each party pays its own costs, including cost of arbitrator you choose, if it's a 3-arbitrator panel (and you share the cost of another arbitrator). If you lose, you're on the hook for Certapro's legal fees and other costs.

18.2.1 Certapro does NOT have to arbitrate for some things (money you owe them if it's $15,000 or less, certain injunctive claims, etc.)

18.4 & 18.5 Certapro can sue you in court, in a Pennsylvania court.

18.6 You can't demand a jury trial.

18.7 You can't sue Certapro for punitive damages.

18.8 You can't participate in class action lawsuits.

18.9 The loser pays attorney fees and costs for lawsuits or arbitration.

19.3 Certapro can't be held responsible for liabilities, losses, lawsuits, etc.

19.4 Certapro not responsible for injury, loss or damage resulting from services or products sold by franchisees.

19.7 You can't withhold payments to Certapro.

19.10 Governing law & jurisdiction: the Commonwealth of Pennsylvania.

20.1.1 You know what you're getting into, so don't cry about it later. [Nevermind that Certapro has silenced some (many?) of its failed franchisees -- it's your responsibility to do due diligence (if you can).]

20.1.2 "Nationwide painting company"?
Nah, you're an independent contractor who has permission to use the CertaPro name.

"Don't hold us responsible for whatever lies we may have made"
20.1.1 Franchisee and any guarantor hereunder acknowledge that they have conducted an independent investigation of the Certa Pro Business and recognize that the business venture contemplated by this Agreement involves business risks and that its success will be largely dependent upon the ability of the Franchisee as a independent business person. Certa Pro expressly disclaims the making of and the Franchisee and any guarantor hereunder acknowledge that they have not received any warranty or guarantee, expressed or implied, as to the potential volume, profit, cash flow or success of the Certa Pro Business. The provisions of this Subsection 20.1.1 do not apply and are not effective in the State of Illinois.

20.2.1 ...Franchisee is an independent contractor and is in no way authorized to make any contract, agreement, warranty, or representation, or to create any obligation, express or implied, on behalf of Certa Pro. Franchisee agrees to prominently display in its place of business a certificate from Certa Pro stating that the business is operated by a Franchisee as a franchisee of Certa Pro and not as an agent thereof.

20.2.2 Hold harmless:
Under no circumstances shall Certa Pro be liable for any act, omission, debt or any other obligation of Franchisee. Franchisee agrees to indemnify and hold Certa Pro harmless against any such claim and the cost of defending against such claims arising directly or indirectly from, or as a result of, or in connection with, Franchisee's operation of the Certa Pro Business.

CertaPro Painters FDD (pdf)

CertaPro Painters Franchise Agreement (pdf)

If they dismiss any of your concerns about this contract:

If you talk to CertaPro about this contract and ask about certain clauses, and if they dismiss them, by saying something like, "Oh, don't worry about that, it's never enforced", tell them to take it out of the contract. Draw a line through it (strike it) and initial it.

See what their response is.

Talk is cheap.

| Home | Forum | Contact |

CertaPro Painters Franchise


[an error occurred while processing this directive]