Meet four emerging players in the services niche
The concept: With six franchisees in Africa, Got Produce? Franchising has disrupted the global agricultural industry for six years using hydroponic greenhouses to grow produce. Now, the Beaverton, Oregon-based firm plans to begin selling franchises in the USA, says CEO and founder Deborah Walliser. Franchisees’ main clientele: Local grocery stores, chefs, restaurants and other food outlets. Each unit can grow four to 24 vine and leafy crops, including cucumbers, tomatoes and strawberries. Walliser says the concept is ideal for existing business owners, multi-brand franchisees and entrepreneurs attracted to the fast-causal, fresh and healthy franchise segments.“There has been no way to ensure local, fresh, year-round production in a branded format until now,” she says.
The stats: Total investment ranges from $410,000 to $3 million, including land and franchise fees. As of February, franchises are in Botswana, South Africa, Namibia, Ghana, Tanzania and Senegal. Plans are to open 25 new units by 2019 globally. The brand will first target U.S. franchisees in Georgia, South Carolina, Florida, Texas and Kentucky. Walliser added the brand is “continuing corporate discussions with brands like KFC, McDonald’s and Subway” to buy franchises for their own produce production.
The rivals: No one directly competes, but Walliser lists Nature’s Table and UFood Grill among competitors, saying they offer an alternative in the fresh food business but with a different model.
The challenges: The biggest challenge now for Got Produce? is creating a U.S. training facility for new franchisees.
The concept: Calling the $78-billion landscape industry extremely fragmented with no solid business models, Driven Landscapes’ Jonathan Orcutt is confident his brand has the blueprint to help franchisees achieve sustainable and steady growth. The provider of 10-plus lawn care and landscape management services to homeowners and businesses in Massachusetts is offering two types of franchises.
The stats: The total investment for a single start-up location runs from $88,160 to $135,585. Plus, the brand offers a discount as an incentive for existing landscape businesses to convert into a Driven Landscape franchisee, adopt its name and business model. That fee ranges from $65,455 to $107,410. It has a company-owned location in Norfolk and franchise site in Hopkinton, both in Massachusetts. The company hopes to open two more franchises by 2018 and another five by 2019 in the Northeast.
The rivals: Grounds Guys and U.S. Lawns are among the biggest competitors. Driven Landscapes will continue to focus on targeting residential customers in the upper-middle class, where nearly 90 percent of business comes from, says Orcutt, the brand’s founder and president. “While we are happy to do commercial service, three of the biggest reasons we prioritize residential service are better profit margins, better loyalty, and a better referral network.”
The challenges: The greatest hurdle Driven Landscapes faces is convincing potential operators that its franchise concept offers them more support than independent ownership would.
The concept: Asserting there is a gap in the nation’s $700- billion market for IT products and services, TechVoo aims to fill the hole. Its game plan: Become an alternative source for expert-level IT services not being provided by large retailers or novice computer repair shops. The firm offers computer repair in retail stores, virtual and business IT consulting and website development. “With a 75 percent gross profit margin annually after paying for goods, our numbers demonstrate we have room for expansion,” says Amit Mehta, TechVoo’s founder and CEO.
The stats: Opening a franchise costs between $81,500 to $150,000. Stores are 1,000 to 1,500 square feet. The suburban Chicago-based firm just began franchising. It has two corporate stores on Chicago’s west side. Plans call for opening three franchise locations this year. The brand hopes to have five to 10 franchise agreements signed by late 2017, allowing it to open another 10 to 25 franchise locations by next year.
The rivals: One big competitor is Geek Squad. Franchise rivals include Fast-Teks, Computer Troubleshooters, Friendly Computers, CMIT and TeamLogicIT.
Challenges: Prospective franchisees may shy away from the concept because they are not technical. However, Mehta says TechVoo does not require a person to be a technician to be successful. Another obstacle: TechVoo has low brand recognition. “Potential franchisees may want to have franchisee validation, so the initial couple of franchisees may take longer to establish,” he says.
The concept: Catering to more than 60 million women aged 35 and older suffering from stubborn weight loss and menopause-related issues, BeBalanced swears it has found a niche not being targeted by the multi-billion-dollar weight loss and hormone replacement therapy industries. “We provide a solution this demographic of women are desperate for,” says David Cutillo, the brand’s director of franchise development.
The stats: Total investment to open a franchise is from $106,000 to $160,000. The brand has franchises in Harrisburg, Blue Bell, and Bryn Mawr and a corporate location in Lancaster, all in Pennsylvania. Other franchises are in Ashland, Kentucky and Annapolis, Maryland. Four more locations will open by June in Houston, Minneapolis, Cherry Hill, New Jersey and Fort Wayne, Indiana. Franchisees have signed to open six more stores.
The rivals: Cutillo says competitors include traditional weight loss businesses like Weight Watchers, NutriSystem and Jenny Craig. On the hormone therapy side, rivals include HRT and Bio-Identicals. But he claims BeBalanced has created a new business category, known as “Natural Hormone Balancing”, setting it apart from “perceived” competition.
The challenges: Cutillo says women have one conversation with their doctor about hot flashes/sleep problems, and a different conversation with their girlfriends about the stubborn 20 pounds they cannot lose. “Our challenge is helping these women realize that all of these issues are one conversation that can be resolved with one, all-natural solution,” he says.