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COVER STORY
Today, Border Foods, is one of the largest multi-unit franchisees in the country—and one that could be larger if the pair had much desire to expand beyond Minnesota’s borders. The route between bankruptcy and the helm of a growing, $170 million business was filled with challenges and setbacks, and navigating it took smarts, perseverance and, yes, a little luck. Along the way the brothers learned many valuable lessons about the business world and about running a multi-unit, multi-concept franchise. |  |
FRANCHISE FOCUS
Development
Who’s building new units, and where
Health & Beauty
Gold’s is looking toward investors to fuel the chain’s growth. The 600-unit company wants to capitalize on its well-known brand in an uncertain fitness market by adding 200 locations by 2010.
More seniors want to stay independent longer, and their growth in population is a boon to the home care industry.
The fitness, beauty and spa industries are comprised of products and services from kick-butt workouts to soothing massages tailored to get us in shape mentally, physically and emotionally. According to FranNet, a consultancy that matches would-be business owners with potential franchise opportunities, these concepts are among the hottest segments in franchising.
Newcomers
Three friends in their mid-20s decided to go into the courier business together. Matt Seiter, Mike Bernecker and Bob Smith, founded Relay Express in 1986.
Susan Sadler, a lifelong gardener, brought her love of tending to outdoor plants inside when she bought an interior landscaping company called Plantscapers. Now, Sadler’s company—renamed Green Life Interiors—is looking to branch out through franchising.
PEOPLE
Personalties
QB Brett Favre has invested in Young Champions, a business concept that combines two of his passions: fitness and children.
Kelly Strowd hopes to make Fetch! Pet Care her day job. She’s now growing her franchise while working full-time as a police investigator, much to the dismay of two of her three attention-seeking dachshunds.
Supplementing the relationship
Step-brothers John Trautman and Andy Paroline have brought their friendly competition to Emerald City Smoothie, where Trautman plans to target the West side of Seattle for expansion, while Paroline has his sight set on the east.
Promotions
Franchising's movers and shakers
UPFRONT
Currents
When California’s first Krispy Kreme franchise opened in 1999, at one point it had 60 cars waiting in the drive-thru. In Philadelphia in 2002 the lines were well out the door for days. A year later in Boston, the Krispy Kreme franchisee reported sales of a record half a million dollars in its first week.
Franchises, like other small businesses, are struggling with the mounting cost of health care. The IFA believes that a market-oriented approach would work best to improve the system.
Editor’s note: We asked a few of our favorite franchise road warriors to share some stories about the challenges of doing business overseas.
Sona MedSpa, a Tennesee-based chain of laser hair removal and skin rejuvenation centers, has been sold for the second time in three years, this time to a North Carolina franchisee that believes it can sustain the company and return it to growth mode.
Taco Del Mar, a casual Mexican concept, was launched in 1992, not on a beach, but on a pier in Seattle by two brothers, James and John Schmidt. Their inspiration—and their surfboard and fake palm tree décor—came from the burrito shacks that lined Southern California beaches during James’ college days. In 1996 the brothers formed a franchise company, with James as its CEO. “We adopted the business plan of Subway,” James Schmidt said, “and sold master developers their own territories to run for us. They’d find franchisees and help them find locations and we’d give them half the franchise fees a
Publisher's Column
The story on Favre’s play into the franchise arena is included in this month’s issue, which has a focus on health and beauty franchises. This is a booming market, one in which many an entrepreneur will take advantage. Favre’s outlook is a bit more altruistic than most entrepreneurs. Let’s just say that he finds most of his daily challenges on the football field, trying to break a record or two. Favre’s goal with the franchise is to help Young Champions founder and friend Kent Johnson succeed at helping kids be fit.
Up Front
Eight hours a day is a long time to go without expressing at least a couple of emotions. While not exactly breaking news, here’s how to turn your keyboard into a therapy session without leaving the job site.
When Brad Ritter turned 40, he stepped on a scale—actually it was three scales at three different locations of his gym—which motivated him to weigh in on a whole new lifestyle. “I got on the scale thinking I’d gained 20 pounds,” he says. Instead, he discovered the 165 pounds he had weighed in his 30s was now 209 pounds. “The pounds crept up due to a bad lifestyle,” the PR professional admits.
Missouri—land of the short wait
Americans don’t like to wait—not for raises, not for traffic jams, not for our food. So if something is fast, in the eyes of the American buying public it’s better. Here are a few of the stars in speed...
When Brad Ritter turned 40, he stepped on a scale—actually it was three scales at three different locations of his gym—which motivated him to weigh in on a whole new lifestyle.
We know you don’t always have the time to text your young employees—sometimes you must talk to them face-to-face, so we’ve prepared an English translation of some of the phrases you may encounter...
BIZ WISE
Development
It should be Rule No. 1 in the franchise-location game: Don’t place stores too close together. Yet, according to franchisees, that’s exactly what some franchisors do—and the result often hurts their bottom line and, in the worst cases, results in protracted legal battles.
Et Cetera
The November/December Franchise Times crossword puzzle and answer key.
Exit Interview
Covering the curse, plus lawyering up at the ABA
Wit and wisdom from Nancy Weingartner, Managing Editor of Franchise Times magazine. This month, Brett Favre, the ABA and GolfTEC.
Finance
Recognizing the current business environment, the above items are just a few key points for the franchise community to consider. The goal for the industry should be to work toward mutually fair positions for both the franchisee and franchisor.
There’s a general consensus among stock market prognosticators that the smart money favors large caps over small caps in the current investment environment.
Human Resources
Informing hourly workers about your company’s career opportunities can be a good way to motivate and to keep them.
Great interviewing is an art, pure and simple. Like any art form, it takes practice, attention to detail and careful execution. But unfortunately, many business owners, managers and supervisors don’t master it before sitting down with an applicant.
Marketing
The most serious issues are those that alert prospects that franchisees currently in the system are dissatisfied. Franchisee dissatisfaction more than anything else alerts a savvy buyer that perhaps they should be shopping elsewhere.
Giving a presentation to best represent your company is more than just giving the actual speech.
Operations
The interesting thing about using business-format franchising to solve the world’s social and health problems is that there is really nothing magical. The tools and techniques we are applying with some innovative modification are the same as the ones used successfully in a multitude of franchises in the U.S.
Part of a multi-unit retail operator’s job is to think deeply about the key portfolios in their business, namely: stores, products and people.
Real Estate
New franchise location announcements.
PAX franchise sales rise along with growing auction trend.
Smaller cities are yielding big profits for some franchise groups. Less competition and lower operating costs are two key incentives pushing brands to take a closer look at markets with less than 50,000 residents.
Anytime Fitness is giving its real estate department a workout. There’s both an art and a science to finding the right location, and often it involves selecting good neighbors.
Restaurant Year in Review
Restaurants—which are perhaps the moodiest sector in all of retail—react to the slowdown in the economy.
Spotlight
The show, which started as a newsletter on franchising, evolved into its broadcast version once Marty McDermott discovered Internet radio. In the 40-plus shows he and Don Johnson have completed, they’ve had relatively few glitches. Once, for unknown reasons, everyone on the line was disconnected—leaving dead air in its wake. “Don and I had to call back into our own show,” McDermott says.
Technology
Communication between franchisors and franchisees can resemble a game of telephone. The messages become garbled and unclear along the way—which, in a business setting, isn’t just fun and games. That’s where the Frantz Group comes in.
It’s been awhile since our columnist has taken a look at computing security. Unfortunately, the battle seems to be growing.
Technology news and information for franchisees and franchisors.
LEGAL
CFR
Franchising 2007: A glance in the rearview mirror
Although most prefer to remember franchising in 2007 as smooth riding, filled with momentous stops for festive conventions, conferences and seminars, the community should also reflect back on some of those jolting potholes and decelerating speed bumps that it encountered along the way.
International
Some unscientific impressions from our columnist’s week in and around London, where he attended two conferences.
Legal
News bits from the legal side of franchising.
Phoenix provides ideal setting for legal showdown and hoedown
A record number of people attended last month’s annual American Bar Association Forum on Franchising, held in Phoenix. The 850 attendees represented more than 40 percent of the 2,100-member forum—a percentage the group’s new chair, Edward “Jack” Dunham, called “preposterously large.”
“Apparent control” can be easily avoided, by making it clear to consumers that the franchisor does not own the business they are patronizing. Here are the six steps that can accomplish just that. The best way to avoid liability for the actions of your franchisees is to be careful who you select as a franchisee in the first place. Simple background and credit checks will confirm whether a prospective franchisee has had difficulties paying its bills or other problems.
