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Ductz adds Hoodz niche: Kitchen hood work 'a natural'
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Bright Side story for the week of May 29, 2009
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Ductz adds Hoodz niche: Kitchen hood work 'a natural'
Many people wouldn't have connected pizza and doughnuts with duct cleaning.
But John Rotche did.
He's turning his work experience with Domino's Pizza Inc. and Krispy Kreme Doughnut Corp. into a new business opportunity for Ann Arbor-based Ductz International L.L.C.
Ductz is launching Hoodz International L.L.C. with about 75 current Ductz franchisees. That number and geographic reach should make Hoodz the largest national commercial hood franchise in the U.S. by the end of the year, said Rotche, who is president of Ductz.
He projects Hoodz will bring in revenue of $7.5 million during its first year of operation. “There's a natural connection” between duct cleaning and hood cleaning, since hoods are just ductwork in the kitchen that carry heat and grease rather than dust, Rotche said. Cleaning commercial hoods requires many of the same tools and the same skill sets as duct cleaning, he said.
Rotche founded Ductz in 2002 as a single van operation, after holding positions at Domino's and Krispy Kreme.
He sold Ductz to Belfor International Holdings Inc., an insurance restoration company, in July 2007. As part of the deal, Rotche agreed to remain as president for five years.
Today, Ductz claims to be the nation's largest air duct-cleaning and HVAC restoration company. Its national franchisees have assisted with remedial services in the wake of disasters such as Hurricane Katrina.
Last October, after deciding to move into commercial hood cleaning, Ductz purchased Sonco Inc., a family-owned hood-cleaning business in Saginaw, and expanded it to Ann Arbor.
In the first six months under Ductz, its annual sales doubled, Rotche said, declining to disclose revenue for Sonco.
Ductz then launched a Hoodz franchise in Salt Lake City after a Ductz franchisee there called to say there were no commercial hood cleaning businesses in that region, Rotche said.
“The hood-cleaning business is very fragmented,” Rotche said. “In most markets, it is being done, but by folks not licensed or insured.”
In April, Ductz introduced its 150 franchisees to Hoodz at its annual conference in San Antonio. About 75 of them have signed up to launch the commercial hood business, which provides work during the night when restaurants typically are closed.
Businesses with commercial kitchens, such as restaurants, universities, schools or hospitals, are required by state and local ordinances to clean hoods and kitchen duct systems to prevent grease fires.
“We call it a night and day operation,” because the duct cleaning takes place during the day, and the hood cleaning at night, Rotche said.
Gaining entry to the commercial hood-cleaning business could also give Ductz franchisees, which now focus more on residential duct cleaning, further entry into commercial duct contracts, Rotche said.
With Belfor International's financial backing, Hoodz will be able to pay franchisees as they do the work for national restaurant chains and then send one invoice to the chains, Rotche said.
For hood cleaning, there are definite advantages entering an agreement where franchisees can elect to opt in with a national provider, said David Mounts, executive vice president of supply-chain services for Domino's.
“If one of the values (provided) is centralized accounting/billing, that's definitely a value-added,” not only for its ability to streamline billing, but also in streamlining compliance checks that Domino's and other national franchisors make against local regulations, to uphold the strength of their brands, Mounts said.
Rotche is correct in seeing a connection between duct cleaning and hood cleaning, said John Line, president of Warren-based Sani-Vac Service Inc., with business in Michigan, Ohio and Indiana.
“It's a good fit. There are quite a few of us contractors out there that do duct cleaning and kitchen exhaust cleaning.”
Sani-Vac has done both for commercial clients for the past 35 years, Line said.
Still, the Michigan market, at least, is not saturated with commercial hood-cleaning companies, he said.
“But is it competitive? Sure, like anything else,” Line said.
While commercial hood and kitchen duct system cleanings generally are required from once a week to once a year, depending on how frequently the kitchen is used, more and more clients are delaying the cleanings as long as they can, he said.
“We're finding with the economic times a lot of our facilities are pushing cleanings out a month or two because ... their volumes have dropped or they just don't have the money,” Line said.
Sherri Begin Welch: (313) 446-1694, swelch@crain.com
