Sales & Development | Franchise Beacon

Where Do I Find FDD’s Anyway?

Michael A. Peterson — Fri, 17 Feb 2023 01:42:58 +0000

Are FDDs Public or not?

The answer is kinda.

If you are like many people, you heard Franchise Disclosure Documents are ‘out there’, and ‘available’, but when you search all you find is sites offering to sell you the documents. There are a couple of reasons for that. First, FDD’s are not public records; they are not like court records, birth, death, and statistical records, or other type of documents you actually have a right to access. For some franchisors, in certain circumstances, you can find their FDD’s online, but if you can’t, no one ‘has’ to share it with you (assuming you are not actively engaged in their discovery process). Irrespective of if you are a potential franchisor wanting to see what this whole “FDD” thing is about, a young franchisor trying to find competitive FDDs to see if you can adopt some best practices, or even a prospective franchisees wanting to find old FDDs of a franchisor that you are considering as an investment, knowing these parameters will quickly let you know if the documents are something you can find, and I’ll even give you the direct links to find them at the end.

The franchisor must be registered in Wisconsin, California or Minnesota. As previously mentioned, FDDs are not public records and some states require franchisors to register their document with state authorities before they can offer or sell franchises in that state. Three such state authorities then make those documents available online: Wisconsin, California and Minnesota.
You must know the legal name of the franchisor; not just their DBA name (Doing Business As). This can be tricky as the legal name may be different from the name used for their brand or business. However, in Wisconsin, the state allows searches for FDDs by both legal and DBA names, so if the franchisor you are looking for is offering franchises in Americas Dairyland, you may still be good to go.
The franchisor cannot fall under the seasoned franchisor exemption. Different states provide different definitions of this, however California is the only state that provides both online FDDs and has this exemption. If the franchisor has a net worth in excess of $5mil, you won’t find their FDD on California’s website.DD on California’s website.

There are other places to find an FDD, but your first stop should be these three state sites:

A. California Department of Financial Protection and Innovation

B. Wisconsin Department of Financial Institutions

C. Minnesota Commerce Actions and Regulatory Documents Search

If you see something in an FDD that doesn’t make sense, want to learn best practices, or are looking to franchise your business or improve or even outsource your franchise sales process, don’t hesitate to reach out!

Since you are looking for FDDs, you are probably considering franchising.

We should connect.

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There’s nothing to lose but questions, and everything to gain by investing 30 minutes.

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ECE is the place to be in 2021

Michael A. Peterson — Fri, 12 Nov 2021 17:01:35 +0000

Yes, The ECE Market is the Place to Be in 2021

_{This article was featured in the May/June edition of Franchise Connect.}

Businesses centered around childcare, preschool, tutoring, etc. are often spoken of in “soft” terms. Many individuals that enter into the children’s services space, and specifically the Early Childhood Education (ECE) space, have a desire to “give back”, “leave a legacy”, or “impact children’s lives. This is more than admirable; a desire to contribute to the greater good is a necessity to succeed in this industry. I want to begin, however, by bringing some hard facts to the discussion.

For the last 6 years, I have represented a franchisor in the ECE industry. When I first met the founders of Building Kidz Preschool in 2015, I was intrigued by their model, purported numbers, and passion, but had never considered the industry in-depth. As a metrics-driven individual, I started looking for concrete data on the industry. If you have ever researched the preschool industry, you know what I found, troves of information from extremely reliable sources.

I started, as they say, at the top; with a report from the Executive Office of the President of the United States (December 2014). The report is a detailed analysis of the true ROI, as a society, of early childhood development through education. If you are wondering if the impact of quality pre-kindergarten education can be quantified, the answer is a resounding “yes”. The report determined that for every dollar invested in educating young children, a lifetime societal return of $8.60 could be anticipated. Half of this return is from increased earnings of the child throughout their lifetime, and the other half is divided between increased parental earnings, lower engagement with the criminal justice system, and reduced expenditures on remedial education by the public school system. Outside of the straight dollar return, the report stated that pre-kindergarten age education leads to a “change in cognitive functioning and brain development” and could account for some characteristics, such as IQ, that are often considered to be hereditary.

Moving away from the President’s report and into actual industry numbers, I found the same availability of data. In 2015, the ECE in the U.S. was a $70B per year industry and had grown 13.5% CAGR 2011-2014. As I helped to launch Building Kidz into the franchise world and grow them to their current 30+ locations, the markers for ECE kept improving. In April of 2018, a report was released by Zion Market Research that pegged the 2017 U.S. market at $13.5B, and in February of 2020, a report by Facts and Figures had 2019 global Early Childhood Education Market at $245B and projected to grow over 10% CAGR until at least 2026.

Of course, that was THEN. Before the change that we are still watching remake our social and business structure.

In the last issue of Franchise Connect Magazine, I wrote about the appeal of home services businesses; lack of client contact, generally minimal investment, people investing more in their homes rather than vacations or going out to eat, among others. While completely true, home-based businesses and home services are not for everyone. Many people have a passion for helping their community, a passion for education, and a strong desire to build a physical presence that contributes. Recently I was speaking with Seth Lederman, one of the country’s leading franchise acquisition and development specialists, and he explained it like this:

Out of the 200 or so people that I have helped find a franchise, about half of them are really just looking for the right business for their needs, budget, and, especially now, the current economy. Many individuals, however, are driven to entrepreneurship by a passion. While still looking at unit-level economics and long-term trends, they won’t consider a business that doesn’t engage them in whatever brings them personal satisfaction. As someone who left the medical field in order to pursue a passion for coaching business owners, I can relate”.

The good news is that, while nothing is yet certain, the preschool and daycare industries seem to be surging back rapidly. The need for preschools as part of the economic recovery is both obvious and data-driven. We learned early on in the 2020 pandemic that, more than just an essential business, childcare is essential to business. For businesses that need their workforce on-site, the need for childcare is unquestionable. After the 30th or 50th zoom call interruption, however, the need for work-at-home parents to have childcare available is quickly becoming apparent as well. For the children’s sake, we’ve already explored the impact early childhood education has on their entire lives, but we must remember too that children that were not in preschool pre-pandemic often had playdates and other socialization activities. These activities are now often looked at as unnecessary group exposure, leaving only preschools and daycare centers as an option for early socialization skills to be developed.

Building a successful pet grooming franchise

Michael A. Peterson — Thu, 13 May 2021 12:40:58 +0000

See the original article here in Franchise Connect Magazine

Building A Successful Pet Grooming Franchise

Although I have an extensive background in franchising, until recently I have had limited exposure to the pet services segment. I am glad that has changed!

I have had pets all my life, and I have been in franchise almost 15 years. However, my knowledge of the overlap, i.e. the pet franchise space, was fairly limited until recently. Since December of 2020 I have had the pleasure of working with Keith Miller, founder of Bubbly Paws dog grooming in the greater Minneapolis area, as we turn his pet grooming business into the newest pet grooming franchisor.

When I learned this issue of Franchise Connect was going to focus on the pet industry, I saw an opportunity to bring a voice to the table that is rarely heard in the franchise space; a business owner that is partially through the process of becoming a franchisor. I believe that Keith’s extensive experience owning pet grooming locations combined with his recent venture into franchising allows him to provide unique perspective into this industry.
I sat down with him recently to discuss Bubbly Paws, the pet grooming industry in general, and the advice he would have to offer somebody who is considering coming into this industry as a franchisee. I’m excited to share our conversation with you, as well as some of my own observations, below.

Michael
Keith, thank you so much for sitting down with me today! I know you’ve got a lot going on; four dog grooming businesses that are booming, a new baby at home plus your 5-year-old, and now trying to break in the franchise industry all at once! You really do have your paws all over the pet industry, don’t you? Besides Bubbly Paws, you also own Pampered Pooch Playground, which is a doggy daycare, and, as I understand it, you’re a podcaster in the pet industry?

Keith
Yes, I run a podcast for pets plus magazine. I love it because it allows me to stay in touch with my roots, as I started my career in the radio industry, as well as provide what I hope is useful content to people in this business. We concentrate on content and interviews that are helpful to individuals in the pet grooming industry.

Michael
Like I said, a busy man! Let’s talk about Pampered Pooch for just a moment and then we’ll get into Bubbly Paws. Pampered Pooch was your first foray into the pet services industry, right?

Keith
It was. We’ve had Pampered Pooch since 2008. 13 years!

Michael
And it was actually your experiences at the Pampered Pooch that led you to launch Bubbly Paws, correct? Tell me about that.

Keith
Keep in mind coming this was 13 years ago. The doggy daycare world was just taking off, and we would often have people stop in and asked to use our tubs on the way back from a romp in the park. We weren’t really set up for that, though we did try to accommodate them when we could. We even considered adding tubs to the doggy daycare but frankly most of our customers picked their pals up on their way home from work or from a trip; they wanted to be in and out quick. So, we decided to launch Bubbly Paws Grooming.

When Keith launched Bubbly Paws almost 11 years ago, he experienced the same unexpectedly rapid success in the grooming market as he had in the boarding space. One location in 2011 became two locations in 2013 and he opened the doors of his 4th location at the end of 2017. When my team conducted a franchise feasibility study for Bubbly, we saw a trend; each location experienced rapid growth in the first 6-12 months, getting quickly to break-even and beyond, and then sustained year over year increases in all locations. We also saw a couple of significant market differentiators.

The first was a fantastic use of social media, including memes, influencers, and dog “ambassadors” to market their locations.

A recent scroll through Bubbly Paws tagged posts on Instagram revealed a post from 7 days previous by Murphy in Minnesota (a sheepadoodle with his own Instagram) with over 1000 likes and comments.

Besides their strong marketing platform, they also offer a service that is becoming ever more popular in the #newnormal world.

Michael
Keith let’s talk about a one of the things that you have done to help Bubbly Paws stand out in the Twin Cities marketplace. You mentioned that the genesis of Bubbly Paws was people coming to Pampered Pooch and asking to bathe their dogs, so you decided Bubbly Paws would have a self-service option, right?

Keith
Exactly. Though most of our services focus on full-service grooming, we do offer a self-service option. Self-service has wide appeal for a couple of different reasons. First, you don’t have to make an appointment weeks in advance. Before the COVID pandemic, even on a beautiful spring Saturday you wouldn’t wait more than 30 minutes, and rarely even that. Now we have an online reservation system so there is never a wait for self-service. It’s a perfect solution for a messy trip to the dog park; hop on the app and book an appointment on your way to the park, and swing by on your way home. Self-service also allows some of our customers that are more budget conscious to wait longer between groomings, instead of coming in every six weeks they can come in every eight weeks or even 10 weeks, and still keep their friend un-stinky in between groomings.
Now, with so many people working from home, getting groceries delivered, and having very little reason to leave their houses, we are finding that just getting out of the house to give their dog a bath in our facilities is what they look forward to for the day. Our bathing rooms have fantastic filtration and ventilation; after all who wants to smell wet dog, you know? The HAVAC systems filter the air out of each bathing room, and are equipped with UV lights which destroy various airborne viruses, like the rhinoviruses and influenzas that cause kennel cough. What better way to get out for a bit than to go to a safe, socially distanced environment that, by its very design, reduces the likelihood of exposure to airborne pathogens?

We saw this reflected in the feasibility study as well. Surprisingly, despite the world-wide disruption caused by the pandemic, amplified by the social disruption that Minneapolis experienced this summer, by the end of 2020 all but one Bubbly Paws location were back to pre-covid numbers, and the 4th is almost there.

To wrap up our conversation, I asked Keith to share his best advice for people who are considering entering into the pet industry. Here’s what he had to say.

Keith
The pet industry numbers are extremely attractive. We are talking about a 10-billion-dollar marketplace that had 6% CAGR growth expectations before the pandemic started, and now industry analysists are saying that is conservative. Honestly, if that is why you are considering this industry, you are looking at the wrong business. I don’t see a path to success, at least in our segment of the industry, for someone without a passion for pets. Pet owners don’t want their family members in the hands of someone that is just in the business for the margins. Groomers don’t want to work for someone like that. Your customers, your groomers, everyone you interact with will pick up on the lack of passion, and you will struggle with both employee retention and customer retention.
For those that have the right passion, before you decide to buy a franchise, do your research on the franchisor. Every detail is important in a pet grooming store; the ventilation, placement of the windows, the shampoos, and cleaners you use, where the bathing rooms are located in respect to the entrance, everything. Visit a few franchise locations; if you don’t see a painstaking attention to detail everywhere you look, then it’s time to look elsewhere.

We are still working through the franchising process. We expect to bring the Bubbly Paws brand to franchise market by mid spring. I, for one, am looking forward to seeing Keith’s passion for pooches translate into a strong, sustainable franchise model.

I Just can’t sell

Michael A. Peterson — Wed, 24 Mar 2021 17:42:41 +0000

See the original article here in Franchise Connect Magazine

I Just Can’t Sell

Many franchises in the home services sector require franchisees to engage in the sales process with the customer. If you think you just “can’t sell”, I promise you, you can.

In February of 2020, the world began to change, and the tectonic plates that underpin our personal, social, and business lives are still moving. For some people, this is the time to hunker down; others see opportunities in the changing landscape, or simply must pivot due to a lost job or other source of income. Irrespective of the reason, franchisors in industries ranging from in-home senior care to preschools to gift basket delivery are reporting year-over-year stability or growth in franchise development.

Home-based businesses are uniquely attractive in 2021. With minimal or no staffing or real estate requirements, and reduced face-to-face exposure to customers, the appeal is obvious. Home services businesses have an added advantage. As Tim Smeltz, the founder of the driveway repair and maintenance franchise NextGen GreatSealcoating recently told me, “Even people that are not working from home are spending significantly more of their free time in their houses. Our homes have truly become our sanctuaries, and people are spending more on both upkeep and the aesthetics of their home environment.” His case is supported by the fact that his first franchisee, who opened in May of 2020, took less than 90 days to break even (according to NextGen’s Franchise Disclosure Document). There are many brick and mortar businesses that are equally well-positioned, such as childcare, senior care, and fast-casual delivery, but the home services sector has most certainly enjoyed a lift in visibility.

For some, these obvious upsides can be tempered by the daunting idea of becoming a “sales person”. If you are hesitating to get into the home services space for this reason, I have great news for you; not only can you sell, but without ever meeting you I can tell you the sales style that you should adopt to sell effectively, and eventually even become great at it.

To be clear, a great salesperson is not someone that can “sell anything to anybody” or “water to a drowning man”. Part of being a great salesperson is identifying someone’s need or want and helping them comfortably reach a purchasing decision that fills it. Salespeople that “convince” someone to buy a product or service that isn’t right for them are not “great’, they are con artists.

So, how do you become comfortable in a sales role? It’s simple, really. First, I’ll share with you the two pillars of any great salesperson, and then I’ll tell you how to find your unique sales voice.

Lay Your Foundation

Pillar one: Become a scholar of your business.

Study your competitive landscape, and what differentiators you offer. Understanding both the strengths and weaknesses of what you are selling is pivotal. I sell franchises for a living, and of course part of my competitive landscape is simply non-franchised businesses. Starting your own business without a franchise does have advantages; for example, franchisees have restrictions on how they can advertise, or what products and services they can offer. If I were to not acknowledge this, at best my prospects would think that I didn’t understand franchising; at worst they would think I was dishonest. By understanding the limitations of your model, you can contrast them against the strengths, and again help the customer reach the decision that is right for them.

Pillar two: Know your competitor’s business as well as your own.

Every business owner sells on their own unique value proposition. In order to effectively communicate what makes your service different and valuable, you have to know the market. When your prospect brings up either a competitor, or even just a feature or benefit that a competitor offers, you’ll be much better positioned if you’ve already studied the advantages and disadvantages of the competition. Also, and equally important, your prospect may simply ask you questions to see how well you know your business; be prepared to answer them.

Zig Ziglar, one of the great sales theorists of all time, famously wrote that “sales is a transference of emotion”. This one phrase has many layers; the fact that you have to be enthusiastic about what you are selling and that people make buying decisions based on emotion backed by logic, rather than the other way around, are just two. Another, which you may not have considered, is that no matter how much you believe in your service you will struggle to covey enthusiasm if you are nervous. It’s hard to be excited in the moment when you are worried about your ability to answer customer questions. Suffice it to say that Mr. Ziglar was not referring to nervousness and self-doubt as the emotions that you need to transfer in a successful sale!

Find Your Voice

Of course, knowledge by itself will not make you a great salesperson. You must be able to transfer the appropriate amount of knowledge, along with enthusiasm and excitement, so that your prospect is fully informed and not overwhelmed. To accomplish this, you must have the knowledge base, and know your best method of walking the prospective candidate through your process, and ultimately decide to do business with you.

Buy Your Own Offering

I don’t mean actually make a purchase from yourself, but mentally go through the sales process from a customer’s point of view. Find the level of information, the tone, and the communication methods that would make you most comfortable if you were the customer. Break you’re the sales process down into steps and analyze each step through this lens. Ask yourself:

What information would I need to know at this step to move to the next step.
What information would overwhelm me at the stage. This is actually a difficult mental exercise; we like to think that we can just take in all of the information and make a logical choice, but that is simply not how we make decisions.
What information, if it wasn’t shared at this point, would you feel was misleading by its absence.
What tone, approach, or style would take you from considering to buying?
What would make you walk away from the purchase?

These 5 questions, when answered for every interaction along the sales process, will illustrate for you your most authentic sales style. If you start from a base of authenticity, and have a deep understanding of your service offering, you will be able to sell comfortably. As you interact with your first several prospects, go back to your notes and see where you may have been incorrect, or where you may need to make minor adjustments to ensure what you are saying and what your prospect is hearing match up.

I told you it was simple! Using this process, you may not start out great, but you will start out proficient. Most importantly, you’ll be comfortable, because you are not trying to force yourself into selling in an unnatural way. If you continue to use this lens to study your sales process, greatness in sales is achievable.