FBR Emerging Franchises 2015
A look at the top brands that have been franchising since 2010 or later. Ratings are based on franchisee satisfaction research. Only the brands with happy franchisees are included!
A look at the top brands that have been franchising since 2010 or later. Ratings are based on franchisee satisfaction research. Only the brands with happy franchisees are included!
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SPECIAL REPORT: <strong>Emerging</strong> <strong>Franchises</strong><br />
Franchisees who invest in an emerging franchise<br />
get in on the ground floor, pay lower start-up costs<br />
and are part of creating the brand model.<br />
“The start-up phase of any new business<br />
in any market is not for the faint of heart.<br />
Starting a business is exciting, but never<br />
underestimate the focus, faith and effort that<br />
are required to succeed during the start-up<br />
phase of a business,” says You Move Me CEO,<br />
Brian Scudamore.<br />
“You’re sticking your neck out and assuming<br />
a lot of risk when you open a franchise.<br />
It’s really important to have the funds available<br />
and the grit to keep at it,” says Pinot’s Palette<br />
franchisee Judy Alewel. “You don’t want to be<br />
in a position of choosing between investing in<br />
the business or making your house payment.”<br />
To mitigate their risk, Judy stayed in her full<br />
time nursing job for a year and worked on the<br />
business at night while her husband, Reed,<br />
left his job as a VP of Sales Operations for a<br />
gaming company to work on it full time.<br />
“First time franchisees need to be aware<br />
that although they are buying blueprint to a<br />
business, it is their responsibility to be actively<br />
involved in their business and to take 100%<br />
ownership of their successes and failures, “says<br />
Stockeland of MODE. “They must have a willingness<br />
to roll up their sleeves every day and<br />
work with an ‘all hands on deck’ mentality.”<br />
Do you have enough patience? From the<br />
time you sign the franchise agreement to the<br />
time you make a profit varies greatly from<br />
franchise to franchise.<br />
“We were in business for four weeks before<br />
we got our first client who only needed four<br />
hours of service a week. We got our second<br />
client two months in, who also only needed<br />
four hours of service a week,” says FirstLight<br />
HomeCare franchisee, Feldman. “July <strong>2015</strong><br />
was our best month. We had 2,100 hours of<br />
service. Essentially we went from eight hours<br />
of service after being open for two months<br />
to 2,100 hours of service after 22 months.”<br />
Feldman feels like he and his family have only<br />
touched the tip of the iceberg when it comes<br />
to growing the business and is shooting to<br />
increase growth by 1,000 service hours a week<br />
within a year. He finds the volatility in hours<br />
to be very challenging since it impacts revenue<br />
as well as his company’s ability to maintain<br />
good employees.<br />
“It will take time to build your business.<br />
You must be patient,” says Pinot’s Palette franchisee,<br />
Judy Alewel. “We opened in August<br />
and did not have our first sold out class until<br />
December. We started to break even six<br />
months in.”<br />
Can you follow a system? Most successful<br />
franchise owners are able to balance their<br />
entrepreneurial spirit with an understanding<br />
that they must adhere to the franchisor’s<br />
system.<br />
“If I could offer one bit of advice to new<br />
franchisees, it would be that you bought a<br />
franchise for a reason. Do not join a franchise<br />
trying to make it your own independent business.<br />
Be part of the whole and participate in<br />
the franchise system to its fullest extent,” says<br />
Stockeland of MODE.<br />
“We struggled our first year because we<br />
tried to manage our existing signage business<br />
and YESCO business with the same amount<br />
of staff we had always had, which went against<br />
the franchise model YESCO had laid out for<br />
us,” says Deters. “Once we staffed up the way<br />
YESCO had told us to, our sales exploded.”<br />
Deters says his two companies share administrative<br />
and HR staff, but that each has<br />
dedicated sales people.<br />
“If you think you know more than the<br />
franchisor, don’t go into franchising,” says<br />
Dale Wasem, who along with several partners,<br />
owns seven Taziki’s Mediterranean Cafe<br />
locations in the Nashville, TN metropolitan<br />
area. “Taziki’s Mediterranean Cafe already<br />
has best-in-class policies, procedures, recipes<br />
and more in place. I came in and followed<br />
the system and remain committed to doing<br />
so.” His advice to prospective franchisees is:<br />
1) Be hands on and engaged in your business.<br />
2) Integrate yourself into the community since<br />
building relationships helps your success more<br />
than advertising. 3) Select the right location<br />
since it will impact your profitability.<br />
Can you handle a 24/7 job? Even though<br />
many of the franchisees who were interviewed<br />
for this report said their actual working hours<br />
were similar to those they had when they held<br />
corporate positions, several said the difference is<br />
that as a business owner your brain is going 24/7.<br />
“We enjoy more day-to-day flexibility then<br />
we did in corporate America, but we think<br />
about our business 24/7,” says Pinot’s Palette<br />
franchisee, Judy Alewel. “Thinking about<br />
work, however, can be fun. We plan events and<br />
enjoy talking about how we are going to grow<br />
the business.”<br />
“The hardest thing is to shut off the business,”<br />
says Mosquito Joe franchisee, Clark.<br />
“My phone is always ringing and since my<br />
office is in my home, employees come by.”<br />
Clark says he believes having an office in your<br />
home is a great way to start, but not good for<br />
a work life balance since separating yourself<br />
from work is harder.<br />
Although people who invest in emerging<br />
franchises come from all walks of life, we noted<br />
that when we compared franchisees from all<br />
franchise sectors with those in the emerging<br />
sector there is a greater concentration of franchisees<br />
with bachelor’s degrees or higher in<br />
the emerging sector (75%) compared to all<br />
franchisees (66%). This makes sense since<br />
individuals who have worked in the corporate<br />
arena, which many graduates do, may well<br />
have more confidence in their ability to make<br />
things work and therefore be less risk adverse.<br />
The faith of emerging franchisees in their<br />
business is also highlighted by the fact that<br />
when asked to score the “long-term growth<br />
opportunity for my business” in our Franchisee<br />
Satisfaction Benchmark Survey they selected<br />
“very strong” 40% more frequently than all<br />
franchisees who responded across all brands.<br />
SIGNING ON THE DOTTED LINE<br />
When it comes to making the final decision<br />
regarding which franchise is best for you, it<br />
will come down to two factors: what you discovered<br />
during the due diligence process and<br />
your gut instinct. You will need to believe in<br />
the concept, have faith in the team that is driving<br />
it, and feel it will fulfill both your business<br />
and personal objectives.<br />
“Take your time and do your research.<br />
Shop the business that you are interested<br />
in and all its competitors,” says Midgley of<br />
Crunch Fitness Franchise.<br />
For more information on this report, visit: www.FranchiseBusinessReview.com | 9