According to Rainbow International website - "Established in 1981, Rainbow International® offers home restoration, commercial restoration and carpet cleaning services through over 400 locations worldwide. Our restoration services cover fire damage restoration, water damage restoration, mold removal, smoke damage restoration, and more.

The possibility of taking on business ownership is exciting. It’s a big decision, but one that can result in a lifetime of financial, professional and personal rewards. Restoration is a solid, recurring revenue business with a perpetual consumer demand (both residential and commercial) that is driven by insurance claims and other elements such as weather and environmental awareness."

Since our organization in 1981, we have offered franchises which provide carpet cleaning, repair, reinstallation and related services; upholstery, drapery and ceiling cleaning and related services, reconstruction and related services; and deodorization services for residential and commercial customers under the name RAINBOW INTERNATIONAL ®. In 1997, we added a non-exclusive option to perform air duct cleaning services. In 1991, we added water and smoke restoration services. In 2001, we added an option to perform remediation services. We offer these franchises as “start-ups” or you may convert an existing business into a Business. We do not own or operate any franchises although we have done so in the past. We have not offered franchises in any other line of business although at various times since 1993, we have also offered regional or area franchises which solicit prospective franchisees and/or provide services to our franchisees in selected areas.

JOIN THE PROFITABLE, RECESSION-RESISTANT INSURANCE RESTORATION INDUSTRY WITH DELTA DISASTER SERVICES


Delta customers get comprehensive reconstruction services to restore the structure to pre-loss condition from a single trusted vendor.

Delta Development Group grants franchises for the operation of commercial and residential property mitigation, reconstruction, remodeling and consulting businesses using the name “Delta Disaster Services ”. Since August 2016, we have also operated one Delta Services Business. We are not engaged in any other type of business activity.

As a Delta Disaster Services franchisee you get access to proprietary scalable processes to meet second year gross minimums of $1million, while servicing both commercial and residential customers with water, fire, and environmental losses.

Exclusive franchise territories are based on a minimum of 280,000 people up to 1 million. They're ideally located near or in a major metropolitan area servicing residential neighborhoods, commercial housing, and hospitality properties.

Rainbow VS Delta Comparison

  Delta Disaster, Inc. Rainbow
Number of locations (US) 8 282
Startup Costs $162,755 - $332,220 $171,675 - $278,100
Territories open limited
Initial Franchise Fee $45,000 $35,000
Supplies, Equipment and Inventory $27,600 - $42,500 $70,000 - $78,000
Vehicle Lease: $400 - $700 / month $2,000 - $39,000(van) - $43,000 (box truck)
Additional Funds (Working Capital)  $52,755 - $65,000 $40,000 - $70,000

Rainbow Disaster doesn't take care of restoration, moreover, it serves only limited territories.

DELTA DISASTER FEES

Royalty

For construction services, reconstruction services, and asbestos abatement-related services, the greater of 4% of Gross Revenue or the Minimum Royalty. 

For mitigation services, which includes contents-related work and structural cleaning, the greater of 8% of Gross Revenue or the Minimum Royalty.

Paid by electronic funds transfer on the sixth day of each month for the preceding month.

Technology Support Fee

$299, payable monthly by electronic funds transfer.

The purpose of the technology support fee (“Technology Support Fee”) is to defray the cost of providmg technology support to you.

Warranty Fund Contribution

1% of Gross Revenue, Payable monthly by electronic funds transfer.

Your warranty fund contnbution (“Warranty Fund Contribution”) will be contributed to the warranty fund (“Warranty Fund”) established to fund the service warranties provided to customers. The total Warranty Fund Contribution will be capped at the amount set forth in the Operations Manual. We have the right to adjust the cap upon thirty days wntten notice to you. Your obligation to pay us the Warranty Fund Contribution will commence two years after you begin operations.

Individual Advertising Expense

2% of Gross Revenue, payable monthly.

Your obligation to make the individual advertising expense (“Individual Advertising Expense”) for advertising and promotion will commence 90 days after you begin operations Prior to the time the Individual Advertising Expense obligation commences, you must spend a total of $6,000 on advertising and promotion in your Area of Primary Responsibility for the first 90 days after you commence operations (See ITEM 7) Salaries for your marketing support personnel are separate expenses that must not be included m the Individual Advertising Expense or the amount you must spend on advertising and promotion for the first 90 days after you commence operations.

National Marketing Fee

1% of Gross Revenue, Payable monthly by electronic funds transfer.

You must pay us a national marketing fee (“National Marketing Fee”) in addition to the Individual Advertismg Expense and Start-Up Advertising The National Marketing Fee will be deposited into a national marketing fund (“National Marketing Fund”) Advertising materials and services will be provided to you through the National Marketing Fund The Franchise Agreement authorizes us to increase the amount ofthe National Marketing Fee to a maximum of 3% of Gross Revenue for the previous month. If we increase the National Marketing Fee, your Individual Advertising Expense will be reduced by the same amount Your obligation to pay us the National Marketing Fee will commence two years after you begin operations.

Successor Franchise Fee

10% ofthe then-current Initial Franchise Fee, payable at the time you sign the Successor Franchise Agreement.

Estimating Software

Xactimate software SI 13 to $160 per month per license.

In order to secure favorable pricing for our franchisees, we have entered into a software license agreement with the licensor ofthe estimating software which we require you to use in connection with your Delta Services Business. This fee could decrease as your number of software licenses increases and depending on the type oflicense you obtain Because this fee is a pass-through cost, we are not deriving any revenue from this fee While we will handle the administration of licenses to our franchisees, you must work directly with the software licensor regardmg any technical issues you encounter.

Software License Fees

Quickbooks Premier Contractor $450-$1,100 for three licensed users, proprietary Delta Management software $200 per month per location or license obtained.

You must comply with all terms and pay all fees that may be due under a software license agreement for any software you are required to use in the operation of your Delta Services Business. The fees to use each software program will vary based on the number of licensed users per location.

Technology Maintenance

$500-$1,500 per computer workstation

We impose no cap or limitation on the amount of expense you may incur for hardware and software upgrades.

RAINBOW DISASTER FEES

License Fee

4% to 8% of Gross Sales except for “roll-in” sales, sales in TAFS, and Reconstruction Services. In addition, minimum license fees apply. 

They reserve the right to require you to spend anamount annually on approved local marketing and advertising of your Business (the “Minimum Local Marketing Spending”) equal to the greater of (a) $15,000; or (b) 3% of your Gross Sales for the previous year. The amount you spend on Minimum Local Marketing Spending will be in addition to any MAP fees you must pay to them. Amounts paid to an Advertising Cooperative, the Start-Up Phase Marketing Spending (as defined below) and certain other amounts of local adver tising spending will count towards the Minimum Local Marketing Spending, as more particularly set forth in the Manuals. Regardless of
whether they impose the Minimum Local Marketing Spending on you, you must spend the amount they specify, between $7,500 and $15,000, for local marketing during the first 12 months of the operation of your Business (the “Start-Up Phase Marketing Spending”).
Software System and Other Software

They require you to use their Software System, currently FUSION, provided by their designed source (currently them), and other software. The monthly fees for the Software System range from $275 to $450 per month depending on your annual sales volume. You must pay them or their designee in the manner they require, currently by ACH automatic bank draft, each month, beginning the earlier of (a) 90 days after the effective date of the Franchise Agreement; (b) the week when, after completing your first week of training, you invoice your first job or receive any payment for a job; or (c) when you start using FUSION. They may at any time substitute or add a different required software for operations, accounting and reporting and office/other business functions for the Business, any such software may be provided by them, a third party or a combination of providers, and you will be required to pay to them or the third-party provider fees for such software and sign related software license agreements. Setup and monthly fees for required software may change in the future. 

Other Fees

In addition to FUSION fees noted above, you will pay a fee for Xactimate, a restoration industry estimating software. The cost of Xactimate is currently $250 setup fee, $155 per month for the Pro Version for each installation and a $4.95 to $29.95 fee for each estimate upload, depending on the size of the estimate. You may also pay $10 to $15 per claim for Symbility, an estimating system used by the insurance industry and $55 per month per user for a hosted version of QuickBooks.

Key Accounts and Third Party Fees

If they establish a Key Accounts program, you must participate in it, which participation may, in some cases, require you to use a third party billing provider that offers additional services and those services may include additional software. These third party providers charge a range of fees, normally a percentage of the Gross Sales of the invoice and/or a per invoice referral or work order dispatched fee which may be in addition to the fees stated above. A company that refers customers may also charge a fee for referrals or the use of their software. We cannot estimate the amount of these fees. 

Renewal

If you are renewing your Franchise Agreement, the Minimum License Fee begins with the 1st week of the term of the renewal franchise agreement and is the rate or amount stated in the renewal franchise agreement. The Minimum License Fee is calculated based on the cumulative number of months of service as a franchisee, including months as a franchisee under the existing Franchise Agreement and the number of months as a franchisee under the renewal franchise agreement. 

Vehicle

You must own or obtain vehicles that meet their specifications as set forth in the Manuals. Each vehicle must have the Marks professionally applied as they specify before the vehicle is put into service. They do not sell or lease vehicles. An existing vehicle may be converted for use in the Business, if the capabilities, capacities, remaining useful life, over all age and state of repair for specific existing equipment can be determined to be at least equivalent to the start-up package; or you may purchase or lease a new or used vehicle which meets our specifications. The estimated low cost reflects the cost of having the Marks professionally applied to an existing vehicle which meets our standards. The estimated high cost reflects the purchase of a vehicle meeting their standards plus having the Marks professionally applied to the vehicle.

Training, Travel, Lodging & Food

$5,500 All 4 trainings-WRT, Business, ASD, FRST

You should allow at least the minimum amount stated above for travel, lodging, food and other miscellaneous living expenses incurred during training. Your actual costs will vary, depending on the distance to be traveled, your method of travel, your lodging and your personal circumstances. The estimate assumes the stated amount of training days, which amount may vary. For additional persons, we will provide training on a space available basis. However, the estimate does not include additional costs and expenses if you request training for additional persons.