How to make the franchising wheel go ‘round
Scenes from Franchise Expo South in Dallas: 1. The Baked Bear’s signature Bear Batter ice cream sandwich—blue cake batter with brownies and fudge. 2. Based in Seoul, South Korea, juice bar concept Beesket is looking to bring its kiosks to the United States. 3. Jason Pazderny (center), VP of franchise development, talks Martinis & Manicures.
Jackie Pierce reached out to several Big Frog Custom T-shirts franchisees, not only talking with them but also visiting their locations, before she signed on to open a Big Frog store in Fort Worth, Texas, in 2014.
While these franchisees didn’t divulge financial specifics, they provided valuable validation and insight into what it was really like to run a Big Frog and that’s a crucial part of the due diligence when choosing a franchise, Pierce said.
Part of a panel discussion on the franchisor-franchisee relationship January 18 at Franchise Expo South in Dallas, Pierce stressed even though hands-on research is important, it’s still no substitute for actually owning and operating a retail franchise.
“I worked my tail off for those first two years,” said Pierce. “That wasn’t exactly what I anticipated, but those first two years I was really building the business. You have to trust yourself. Once you’ve made the decision, trust that you’ve made the right decision.”
Pierce added she’s fortunate to have resources at the franchisor level who provide ongoing support and training and—perhaps most importantly—keep the lines of communication open when there are issues.
That open communication is a hallmark of a healthy ‘zor-‘zee relationship, said Camp Bow Wow franchisee and panelist Linda Grady, who is getting ready to open her second location of the pet care concept, this one in Grapevine, Texas. Even though she’s going into her 11th year of ownership in the Camp Bow Wow system, Grady still regularly calls her franchise support contacts, including VP of Franchise Development Renuka Salinger, to tap into their advice and get help when she needs it.
And on the franchisor side, “I take those calls,” said Salinger. “When you’re selecting a franchise you have to think five, 10, 15 years down the road, who do you want to be working with” and are the people in that system going to be there when you need them.
Speaking in another session on becoming a successful franchisee, Genevieve Prieto said it comes down to recognizing your weaknesses, taking steps to strengthen them and also “hiring the right people to fill those other roles.”
Prieto, a former Domino’s franchisee who’s now bringing the I Heart Mac & Cheese restaurant concept to Oklahoma City, noted that before her first foray into the pizza business she’d “never so much as waited a table.” But she spent a year working in a Domino’s store to learn the business from the ground up and the experience proved invaluable.
“The reason people look at a franchise is because they have the wheel invented—you’re buying into the process that they’ve already put together. You’re buying into all of that expertise,” said Prieto. “But you’re still down here running your business. It’s your business. You’ve got to own that.”
The show floor at Franchise Expo South, which in 2019 is moving to Fort Lauderdale.
At an expo filled with brands looking to expand by signing new franchisees to single, multi-unit or area development agreements, an education session devoted to franchise resales—buying an existing franchise operation—seemed counterintuitive, but as Wireless Zone’s Keith Dziki said, “We want all our franchisees to have an exit plan. Every franchisee has a life cycle with the brand—it’s not forever—so resales are another way to bring new owners into the system.”
Speaking at Franchise Expo South in Dallas, Dziki, director of franchise development for Wireless Zone, said his view is that resales are simply part of franchising and don’t necessarily mean the store for sale is performing poorly. Oftentimes it’s quite the opposite, Dziki continued, and buying an existing location carries with it a host of advantages, including cash flow already being in place.
“These existing franchise locations are making money from day one” in most cases, agreed Rod Lowe, franchise marketing manager for 7-Eleven. “You’re inheriting an established sales record in that market.”
The ability to leverage brand strength, plus physical components such as the building and equipment, are other benefits of resales, but, Lowe noted, these can all be potential disadvantages as well, depending on the condition of the location. “You’re usually getting everything as is,” said Lowe.
That “as is” condition can sometimes bring challenges. “Have the brand standards been followed? Do you need to do work to build up the brand name?” Dziki said about questions potential buyers should ask.
“These are some of the things you have to consider and do your due diligence, the same as if you were looking at a new location,” said Dziki.
“Success, ultimately, is up to you, not the location you buy.”
Tune Up—The Manly Salon served beer at its booth at Franchise Expo South.
Around the show
Out on the show floor, Franchise Expo South served to introduce attendees to established brands such as Grease Monkey, Hardee’s and The Melting Pot, plus emerging brands including Tune Up—The Manly Salon and sister concept Martinis & Manicures. Tune Up, with four company stores and 11 franchise locations in Texas, was described by Jason Pazderny, VP of franchise development, as appealing to men who are looking for more than just a haircut.
Tune Up’s services also include facials, straight razor shaves, eyebrow waxing, manicures and pedicures, and customers can get a complimentary mixed drink, beer or soda from the full bar. Likewise, Martinis & Manicures, which has two stores north of Houston, offers cocktails in a spa setting providing manicures, pedicures and reflexology services.
On the food and beverage brand side, co-founder Rob Robbins handed out samples of The Baked Bear ice cream sandwiches and said the concept is poised to continue its push east from California, where it has a dozen locations. With numerous cookie, ice cream and topping combinations for its ice cream sandwiches, Robbins said The Baked Bear is a premium-feeling dessert brand but with a menu of items all around $5. The brand has a strong social media following that plays into its expansion plans, and Robbins touted the company’s marketing capabilities.