THE U.S. CARPET CLEANING INDUSTRY

(A Marketing, Competitive & Operational Analysis)

- July 2006 -

TABLE OF CONTENTS Pages

Introduction - Study Scope, Methodology, Sources Used 1-5

Nature of The Business - How Services Operate 6-10

* Discussion of evolution of the industry, number of companies, average company size, typical services offered, specializations, franchises vs. independents, start-up costs

Executive Overview & Major Findings 11-26

* Major report findings: highlights of all the chapters; Nature of the Business - evolution of the industry, typical services offered, franchises vs. independents; Emerging trends, End-User Factors Affecting Demand For Carpet Cleaning – discussion of the various drivers for the carpet cleaning industry, Size & Growth Of The Industry – Census data, Marketdata estimates of industry receipts, Marketdata projections for 2006-2010; The Market for Carpet Cleaning Equipment, Major Carpet Cleaning Franchises – domestic franchising trends, comparison of franchise fees and start-up costs, Major Operating Ratios Of Carpet Cleaners – Findings of Cleanfax and CMM Magazine 2005-2006 surveys, in-depth analysis of 2002 U.S. Census of Services Industries; Analysis of industry profitability.

End-User Factors Affecting Demand For Carpet Cleaning Services 27-39

* Discussion of the various market drivers for the carpet cleaning industry

* Traditional carpet maintenance and a look at health concerns

* An analysis of current construction trends; annual construction spending, housing starts,

and the increased size of new homes

* Analysis of the U.S. floor covering market; sales by type floor covering and market share

* Recent trends in U.S. carpet industry factory shipments; mill value and square yards

* A look at recent trends in U.S. carpet sales

Tables:

* EPA Carpet Cleaning Guidelines

* U.S. Private Construction Spending: 1990 to 2005

* Residential and Nonresidential Construction Spending as % of Total Private Construction

* Annual Increase in New Privately Owned Housing Starts, Real GDP, and Mortgage Rates

* Square Footage of New Single Family Homes

* U.S. Floor Covering Market, Factory Sales: 2000 to 2004

* U.S. Floor Covering Market Annual % Change in Factory Sales: 2001 to 2004

* U.S. Floor Covering Market Share: 2000 to 2004

* Total Carpet Industry Shipment: 1975 – 2004

* Retail Area, Hand Made, Machine Made, & Washable Rug Sales

Size & Growth Of The Industry 40-56

* Discussion of industry receipts data from the U.S. Bureau of the Census, its accuracy and limitations, historical trends

* Rationale for Marketdata’s estimates of industry receipts

* Industry outlook: the perspectives of industry insiders (Assn. of Specialists in Cleaning and Restoration, Cleaning Consultants, Institute of IICRC, and Rainbow International Restoration & Cleaning

* Marketdata estimates and supporting rationale for industry receipts for 2005

* Marketdata projections and rationale for industry forecasts for 2006 through 2010

* Market segments of the industry, estimates of the $ size of the residential carpet, commercial carpet, and disaster restoration segments

Tables:

* U.S. Census Annual Receipts For Carpet and Upholstery Cleaners: 1986-2004

* Marketdata Estimated Industry Receipts For Carpet Cleaners: 1986-2004

* Projected Industry Receipts: 2005-2010

* The Size Of The Carpet Cleaning Market Segments: 2004

The Market for Carpet Cleaning Equipment

* Discussion of findings of Freedonia Group study Janitorial Equipment & Supplies to 2009

* Marketdata’s estimates and rationale of the size of the carpet cleaning market

* Marketdata projections of the future demand for carpet cleaning equipment

* A look at the top 10 producers of carpet cleaning equipment

* Contact list for the top 10 producers of carpet cleaning equipment

Tables:

* Freedonia Estimates Of Carpet Cleaning Equipment Demand: 1994-2014

* Marketdata Estimates Of Carpet Cleaning Equipment Demand: 1994-2004

* Projected Demand For Carpet Cleaning Equipment: 2004-2010

* Largest Carpet Cleaning Equipment Manufacturers

The Major Carpet Cleaning Franchises 57-88

* Analysis of the domestic franchising trends - the top 10 franchisors

* Discussion of the total number of domestic, Canadian, and foreign franchises and

company owned units

* Comparison of the initial franchise fee, franchise terms, minimum net worth and liquidity

requirements; and total initial investment, for the top 10 franchisors

* Discussion of the availability of internal and external financing

Tables:

* The 10 Top Carpet Cleaning Franchises, Ranked By No. of U.S. Franchises: 2002-2005

* Estimated systemwide revenues of top carpet cleaning franchises: 1999, 2002, 2005

* Major Carpet Cleaning Franchises Total Number Of Units: 2002-2005

* The Cost of the Top Carpet Cleaning Franchises

Profiles Of Some Leading Carpet Cleaning Companies

(In-depth profiles including: company contact information; company history; number of domestic, Canadian, and foreign franchises; franchise terms for each of the following companies:

* Chem-Dry

* Duraclean International

* Heaven's Best

* MilliCare Commercial Carpet Care

* Professional Carpet Systems

* Rainbow International Restoration & Cleaning

* Sears Carpet & Upholstery Care Inc.

* ServiceMaster Clean

* Stanley Steemer Carpet Cleaner

* Servpro Industries Inc.

Economic Operating Ratios Of Carpet Cleaners 89-119

* Major findings, averages, ratios of the Cleanfax “Carpet Cleaning Benchmarking Survey Report” and the Cleaning & Maintenance Management “Contract Cleaning Benchmarking Survey Report”

* In-depth analysis of 2002 U.S. Census of Services Industries: total industry receipts; receipts by size of firm; revenues by source of receipts; legal form of organization; industry concentration ratios; single and multi unit operations; geographic analysis by state and standard metropolitan area

* Analysis of industry profitability using common size financial statements

Tables:

* Carpet Cleaning Firms and Establishments: 1992 to 2002

* Carpet Cleaning Industry Receipts, Annual Payroll and No. of Employees: 1992 to 2002

* Carpet Cleaning Establishments: Average Receipts, Payroll, and Number of Employees

per Establishment: 1992 to 2002

* Receipts by Size of Firm: 2002, 1997, 1992

* Carpet Cleaning Industry, Sources of Receipts: 2002, 1997

* Carpet Cleaning Services Establishments and Receipts, by Legal Form of Organization:

2002, 1997, 1992

* Carpet Cleaning Services, Concentration Ratios, By Estab. Size: 2002, 1997, 1992

* Ratios by Single Unit vs. Multiunit Firms: 2002, 1997, 1992

* Carpet Cleaning Services, Ranked By No. of Establishments By State: 2002

* Carpet Cleaning Services, Ranked By No. of Estabs. for the 50 Largest Cities: 2002

* Annual Statement Studies Common Size Balance Sheets: 2001-2005

* Annual Statement Studies Common Size Income Statements: 2001-2005

* Annual Statement Studies Select Financial Ratios: 2001-2005

Reference Directory Of Industry Trade Associations, Journals,

Consultants, Other Sources 120-128

* Address List of industry trade associations, trade journals, industry experts, special reports and surveys, government documents, all other sources used.