Multi-Unit Franchisee Magazine - Issue I, 2024 by Franchise Update Media

Multi-Unit

Franchisee ISSUE 1, 2024

Explore the Mega 99 rankings Case Studies: When it’s time to sell

RYAN DEBIN CHIEF EXCITEMENT OFFICER

Encourages “smile-watt hours”

Grow With Us and Spread More Joy Every Day! We have opportunities in select, prime markets and non-traditional venues for qualified restaurant operators and developers with varied incentives for development.* WE ARE: • A dynamic brand that aims to deliver on popularity, relevancy, adaptability, and support

• A loved place where guests can enjoy classic favorites and craveable menu innovations any time of day • An established franchise system with a business model and flexible design—from conversions to freestanding, endcap, in-line and non-traditional—adaptable across varied venues • An integrated franchise support system—Operations, Marketing, Training, Architecture & Design, and Development*

*Subject to Franchise Agreement and Development Agreement Terms © 2024 IHOP Franchisor LLC. This is not an offer to sell a franchise. An offer can be made only by means of a Franchise Disclosure Document that has been registered and approved by the appropriate agency in your state, if your state requires such registration, or pursuant to availability and satisfaction of any exemptions from registration. IHOP Franchisor LLC, 10 W. Walnut St., 4th Fl., Pasadena, CA 91103. (866) 995-3463

FRANCHISE OPPORTUNITY

MENU. WE’VUNIQUE E CRACKED THE CODE ONLOW PROFITABILITY WITH A STARTUP COST. $4.69M AUV*$3.77M & $654K AVERAGE AUV. EBITDA.** Now’s the time to get your claws on a family-friendly, seafood boil franchise that’s cracked the code on proﬁtability and bold Asian-Cajun ﬂavors guests love. As the conversion experts in second generation restaurant sites, you’ll shell out less on your buildout while dramatically shortening the time to start bringing in the clams.

Unique menu and proprietary ﬂavors drive repeat business

Underserved category in a crowded food segment

$537,600 Median Initial Investment***

Open faster with 2nd gen locations

Net a great opportunity.

angrycrabfranchise.com | 586-907-6404 *This figure represents the net sales achieved for calendar year 2022 at the top 50% of affiliate owned and franchised restaurants. **This figure represents the average EBITDA achieved for calendar year 2022 as a percentage of consolidated net sales at the same 50% of affiliate owned and franchised restaurants. *** This figure represents the Median Initial Investment to open all the affiliate restaurants and eight (8) of the ten (10) franchised restaurants operating in 2022 that were open for at least one year, all of which were opened in Second Generation Sites. Second Generation Sites are restaurant locations where the operator utilized a premises that was previously operated as a restaurant and therefore requires less initial investment to open and operate. Most Angry Crab Shacks are opened in Second Generation Sites. Each of the included restaurants were open for all of calendar year 2022. This information appears in Item 19 of our Franchise Disclosure Document (FDD). You should review our FDD for details about these results. Your results may differ. There is no assurance that you will do as well. ©2024 Angry Crab Franchise Opportunity. Angry Crab Franchise LLC. All rights reserved. 2345 S. Alma School Rd. Suite 106, Mesa, Arizona 85210

Contents Multi-Unit Franchisee | Issue 1, 2024

As chief excitement officer at Momentum Enterprises, Ryan Debin focuses on family and fun and encourages his team to create as many "smile-watt hours" as possible.

Taking care of customers and anticipating their future needs are moving targets. That’s why successful franchisees keep looking for new ways to meet and exceed expectations.

Members of the Multi-Unit Franchising Conference’s Board of Directors share their vast experience while also helping you plan for the challenges and opportunities of 2024.

RYAN DEBIN

2 | Multi-Unit Franchisee | Issue 1, 2024

THE FUTURE IS NOW

FORECASTING 2024

Multi-Unit Franchisee Issue 1, 2024

Contents

116 Exit Strategies

RANKINGS

CHAIRMAN’S NOTE

Simplifiers and Multipliers Unite at MUFC

62 Mega 99

Diving into multi-unit trends

118 Investment Insights

MU PROFILE

FEATURES

10 Sam Askar

74 The Selling Odyssey

Seeing franchising from both sides

16 Ryan Debin

Chief excitement officer invests in fun

22 Bryant Greene

Operator embraces his duty to care

How 4 operators exited their businesses

80 The Future Is Now

Provide the service customers demand

86 Forecasting 2024

MUFC board members predict the year ahead

28 Steve Leibsohn

Following twists and turns to Wetzel’s Pretzels

COLUMNS

34 Karl Malchow

108 Service Culture

Former delivery driver enjoys franchise success

When selling, think professionally and personally

Consumers behave predictably unpredictable

120 IFA Legislative Update

A balanced approach to protecting franchising

122 Franchisee Tactics

How to become a hometown business

124 Succession Planning

Building a better family partnership

126 Market Trends

Grow the thoughtful way

Deliver relentless customer service

110 Finance

42 Pathik Patel

Building an “Of Course, I Can” culture

48 Tom Petenburg

Keep the eventual end in mind

112 Customers Count

Test employees to focus their training

“One-brand guy” finds his fit

114 People

54 Joe Piro

Here’s a tip: Keep tipping legal

Going from burgers to salads

Our Team CHAIRMAN

Gary Gardner CEO

Therese Thilgen EXECUTIVE VP OPERATIONS

Sue Logan

EVP, CHIEF CONTENT OFFICER

Diane Phibbs

VP BUSINESS DEVELOPMENT

Barbara Yelmene

BUSINESS DEVELOPMENT EXECUTIVES

Krystal Acre Jeff Katis Judy Reichman EXECUTIVE EDITOR

Kerry Pipes

MANAGING EDITOR

M. Scott Morris

SENIOR SUPPORT COORDINATOR FRANCHISEE LIAISON

ASSOCIATE EDITOR

Leticia Pascal

CREATIVE DIRECTOR

Michael Llantin

DIRECTOR OF TECHNOLOGY

Greg Del Bene

WEB DEVELOPER

Chelsea Weitzman

WEB PRODUCTION ASSISTANTS

Lillian Swenor

Eddy Goldberg Cindy Cruz

Benjamin Foley Don Rush

Esther Foley

SENIOR GRAPHIC DESIGNER VIDEO PRODUCTION MANAGER EVENT OPERATIONS MANAGER

CONTRIBUTING WRITERS

Helen Bond

Colleen McMillar

Article Inquiries editorial@franchiseupdate.com Subscriptions subscriptions@franchising.com 408-402-5681

EVENT PRODUCTION COORDINATOR

Juliana Foley

DIRECTOR, EVENT OPERATIONS

Katy Coutts

SENIOR SUPPORT MANAGER

Sharon Wilkinson

CONTRIBUTING EDITORS

Mary Lou Atkins Carty Davis John DiJulius Matthew Haller Barbara Nuss Carol M. Schleif Paul Wilbur Issue 1, 2024 | Multi-Unit Franchisee | 3

Chairman’s Note

Simplifiers and Multipliers Unite at MUFC The greatest partnership in business is when a “simplifier” and a “multiplier” collaborate to create a bigger future than either could have done on their own. This same principle applies to franchising. The franchisor is the simplifier, and the franchisee is the multiplier. Let me explain. A simplifier takes an idea and distills it to the simplest, most cost-effective way to implement it. In franchising, the franchisor: • Creates the concept • Defines the brand identity • Protects branding and fights trademark infringements • Creates systems to reduce waste • Harnesses the power of strategic vendors to cut through clutter and streamline the system • Reduces costs and obstacles in its supply chain • Creates strong marketing programs, omitting the need for the franchisee to negotiate with regional or national media Most franchisors do not excel at managing hundreds of their own locations. That is where the multiplier comes in. A multiplier will take someone’s idea and replicate it repeatedly. In our industry, these are the entrepreneurs/franchisees who: • Scout out locations and negotiate leases • Manage payroll, human resources, tax compliance, etc. • Hire and develop employees to achieve the brand's standards • Understand and master local store marketing • Manage and develop multiple locations

4 | Multi-Unit Franchisee | Issue 1, 2024

They quite literally multiply the brand’s locations and market share. Year after year, the Multi-Unit Franchising Conference amasses the greatest number of simplifiers and multipliers in franchising—period. Top-notch multiunit franchisees interact with each other during panel discussions on industry trends and best practices and at social events, including the meet and greet at Carmine’s Italian Restaurant in Caesars Forum on March 19. Such opportunities allow the many multipliers in franchising to share ideas and create new relationships. There are two days when the greatest franchisors (simplifiers) will exhibit their brands to all conference attendees (you, the multipliers). This is your chance to strengthen your current simplifier/multiplier collaboration with your existing brands and see if there is another opportunity for a new partnership. When you visit a franchisor’s booth at the MUFC, you will meet founders, CEOs, and/or development officers, providing a great opportunity to see if a future collaboration would be an ideal fit. If your goal in 2024 is to strengthen your current holding’s profitability or to expand into new locations or concepts, the Multi-Unit Franchising Conference is the single, most impactful event for franchise-focused entrepreneurs. It all happens March 19–22 at Caesars Forum in Las Vegas. I am looking forward to seeing you there!

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We try our very best to treat them the way we like to be treated. We have rules like anybody else, but we’re a family. Since FYZICAL is so small, we feel like we can do that. We treat people in our community, we take care of our community, and that’s our goal.

How did you choose the FYZICAL brand as the right investment opportunity to help grow your enterprise? It’s about being in healthcare and taking care of people. Early on, my wife, Shanie, said that FYZICAL is her jam. She loves what she’s doing and is the backbone of everything we do. I tell people, “Just watch her.” It’s more than a hospital facility, a doctor’s office, or another physical therapy center. The one-on-one, the caregiving—it all starts with her.

What did it take to go from 1 to multiple locations? We decided to add another franchise to our portfolio because we are healthcare people and like caring for people. I had a physician tell me that one of the most difficult things to treat in rural communities in an emergency room was vertigo, and I suffered from that for 20 years, which is why I went to FYZICAL. And now I’m bringing their Balance Program here.

How did you build the necessary infrastructure for your company? A family member, who invested with us before, was looking to again. That’s how it started. We needed a PT and knew someone looking to make a career change. I had a general contractor friend, and FYZICAL helped with the build-out. There are a lot of steps to it, but they’re not difficult steps. You have to get the money first. That’s how it starts.

What are your goals for next year? We saw our first patient in March. We’ll see 300 this month with two clinicians, each seeing 14–17 patients a day. We want to eventually bring our youngest family member into the clinic, grow within the clinic itself, and add another staff member because we’ll be that busy. I don’t have any doubt that we’ll be the premier physical therapy clinic in the community.

How do you handle hiring and firing employees? We try to partner with colleges to bring interested students in for rotations, which could lead to employment. When hiring, we want to sell ourselves too. It’s important to tell people

who we are, how we function, what we look like, our expectations, and how we’ll treat them so they know, “This is what I’m getting when I come to work for these people.”

Did you have mentors along the way? If so, who were they, and how did they help? There are five to 10 people I’ve learned from in my career—how not to treat, manage, or be like. My wife is my biggest mentor. I watch what she does. She taught me how to treat people and be better. My pastor and close friends, Josh Snead and Mike Breckenridge, have also taught me a lot about life and how to treat people that carry over into the business world.

How many locations/units do you plan to have? We’d love to expand—the city is big enough for another one. There would be fewer costs involved because you don’t have to do all the credentialing. This will be a family business, and our daughters will be involved, so we may be done in a few years, but they may try to expand. Time will tell.

In what ways do you measure your growth? Shanie measures patient load, how we’re doing, and referrals, a big measuring stick. The goal at FYZICAL is three referrals per clinician per week. We have two clinicians and have had 35 referrals in the past three weeks. I’m very encouraged. Our daughter, also our marketer, works hard at referrals. I measure whether our checking account is going up or down.

Are you looking to add territories or markets with this brand? We’ve got a long time to wait until we know what we’re going to do with our two current franchises.

What is your next big goal with the FYZICAL brand? To wake up every day knowing that things are turning green. Of course, we love taking care of people and treating patients. At the end of the day, we’re all capitalists. We want to know that the tiller is doing its job and what we hoped it would do for our family. You’re not in the green if you close your doors. You’re in the red and not taking care of people.

How many units do you plan to have with the FYZICAL brand in 10 years? We’ll have to wait and see. We’re building a family business, and franchising has allowed us to do things we may have never been able to do. The ultimate goal is to put our daughters in a good place when we decide to be done, so they can be taken care of. There’s peace of mind in doing this for my wife and my family, and we’re excited and happy for our kids.

Issue 1, 2024 | Multi-Unit Franchisee | 7

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Sam Askar

“I knew that I ultimately wanted to be in business for myself— and in a position of not just buying a job, but growing it.”

A Zee-Zor Dynasty

Sam Askar knows franchising from both sides Written by HELEN BOND

47-store purchase of Dunkin’ locations in top markets throughout southeast Florida. Casey is Askar Brands’ chairman and CEO. Askar describes him as the ultimate visionary who drives opportunistic growth. Askar’s passion lies in operations and developing the people side of the business. Together, they make a formidable team in franchising. “Our overall approach, for the most part, is a focus on value,” he says. Before he was born, his family fled Northern Iraq to escape Christian persecution. They eventually settled in Caro, Michigan, a town of 4,000 north of Detroit, where his parents owned Lucky’s Kountry Korner. For a time, the family of six lived behind the convenience store in a trailer. The 800-square-foot parking pad remains visible today on Google Earth. “We couldn’t afford to hire any employees, so the family were the employees, and we grew up running the register,” Askar says. “We had a lot of challenges, and I knew that I ultimately wanted to be in business for myself—and in a position of not just buying a job, but growing it.” Askar is fulfilling that childhood dream. He and his brother now live in Naples, Florida, the base for the Askar Family Office portfolio, which also includes commercial real estate, energy, and construction.

SAM ASKAR

COO

Company: Askar Brands No. of units: 75 Dunkin’, 42 Church's Texas Chicken; 1 Papa Romano’s, 1 Blackjack Pizza. Askar Brands is also the franchisor of Papa Romano’s, Blackjack Pizza, Papa’s Pizza To Go, and Breadeaux Pizza Age: 45 Family: 3 sons, Gabriel, 14, Valentino, 14, and Santino, 9; 1 daughter, Francesca, 13 Years in franchising: 18 10 | Multi-Unit Franchisee | Issue 1, 2024

s COO of Askar Brands, Sam Askar oversees the operations of a bourgeoning $200 million multi-brand portfolio of quick-service and fast-casual restaurants, including 75 Dunkin’ and 42 Church’s Texas Chicken locations. Askar and his older brother and “lifelong mentor” Casey Askar also understand the franchisor’s side of the business. Askar Brands acquired Papa Romano’s in 2006. That was followed by Blackjack Pizza, Papa’s Pizza To Go, and Breadeaux Pizza. In 2019, the brothers took an accelerated step to become franchisees by buying a multi-state group of existing Church’s Texas Chicken restaurants. That was followed in 2020 by a mammoth

After spending half of 2023 in the field focused on fine-tuning infrastructure and building the team, the 45-year-old father of four is looking toward a bright future. Armed with the dual operational insights as franchisor and franchisee—and a penchant for concepts that “push value”—the Askar brothers aim to grow to more than 500 locations over the next decade. “Having the ability to work with and develop people is more important than ever in this post-Covid world,” Askar says. “The more we can acquire or build, the more opportunity we have to touch people and grow.”

PERSONAL

First job: I worked at our family-owned convenience store. Formative influences/events: When we were young, our parents fell on hard times

Sam Askar

“All of my life, my mentor has been my brother Casey. I have learned the best practices that can be utilized in different aspects of business within different industries. Also, Tony Lutfi has been a mentor of mine. Through Tony, I have learned how to reflect on my thoughts and be diplomatic in my actions.” dealing with the challenges of owning a small business. The struggles were real, and we felt them at home. Key accomplishments: Building, focusing, and growing a solid team. Biggest current challenge: Work-life balance. Next big goal: Obtaining my pilot’s license. First turning point in your career: Entering the pizza business. Best business decision: Entering the pizza business. Hardest lesson learned: Allowing the wrong people into my life and/or business. Work week: I spend 50% of my time in the field and 50% of my time in the office. Exercise/workout: My weekly routine is typically four days of weight lifting and two days on the Peloton. Best advice you ever got: Building a team has as much to do with understanding their lives as it does understanding their talents.

Favorite movie: “Rocky II.” What do most people not know about you? I come from a small town of 4,000 people, Caro, Michigan, just north of Detroit. Pet peeve: When information is provided to me and it is not vetted or accurate. What did you want to be when you grew up? Business owner. Last vacation: Bahamas. Person you’d most like to have lunch with: Dana White, CEO and president of UFC.

MANAGEMENT

Business philosophy: Focus on people to improve culture. Also, work to grow an organization to embrace change, innovations, and new opportunities. Management method or style: Coaching and mentoring is my management style. Greatest challenge: Wanting more for people than they want for themselves.

What’s your passion in business? Developing a team and taking on new challenges.

How do others describe you? Effective, fair, and caring.

How do you balance life and work? I don’t think I do this well; it is something I continue to work on year after year. However, I have also learned that it is not something you have to perfect. Each needs its own attention at different times.

Have you ever been in a mentor-mentee relationship? All of my life, my mentor has been my brother Casey. I have learned the best practices that can be utilized in different aspects of business within different industries. Also, Tony Lutfi has been a mentor of mine. Through Tony, I have learned how to reflect on my thoughts and be diplomatic in my actions.

Guilty pleasure: A Dunkin’ Glazed Donut. Favorite book: Atlas Shrugged by Ayn Rand.

One thing you’re looking to do better: To listen better and more. How you give your team room to innovate and experiment: I urge them to think outside the box, and I do not shut down new ideas or thoughts. After evaluating the idea and thought, we provide them with time and/or finances to experiment. How close are you to operations? I am married to it. To me, it is the most important piece of our business. What are the two most important things you rely on from your franchisor? Staying ahead of the marketing trends and technology. Consistent supply chain at the best cost. What you need from vendors: Product consistency and real-time support. Have you changed your marketing strategy in response to the economy? Yes. We have deployed more value-driven offers. How is social media affecting your business? Social media is positive for our business as it allows for instant communication with customers and immediate conversion into sales. How do you hire and fire? We use all forms of hiring: ads, recruiters, and a constant, eyeopen approach to recognize talent. The wrong people fire themselves. How do you train and retain? We train using brand tools and standards. How do you deal with problem employees? We communicate with team members to Issue 1, 2024 | Multi-Unit Franchisee | 11

Sam Askar

understand the problems, then provide solutions, and set expectations. Fastest way into your doghouse: Simply saying, “I sent an email,” if something fell through the cracks.

BOTTOM LINE

Annual revenue: $200 million. 2024 goals: Operational goals are transactions! In this post-Covid world with employment levels headed back to par, we will focus on operational excellence and exceptional customer service to drive traffic. We will target new site developments and keep our eyes open for potential acquisitions. Growth meter: How do you measure your growth? Typically, sales and new sites. This year, we will be focused on transactions and development. Vision meter: Where do you want to be in five years? North of 300 locations in five years. In 10 years, north of 500 locations. Do you have brands in different segments? Why/why not? Yes. Diversification and scalability by brand. 12 | Multi-Unit Franchisee | Issue 1, 2024

How is the economy in your region(s) affecting you, your employees, your customers? Each region reacts to the economy differently, and the differences today are greater than they have been in the past.

What are you doing to take care of your employees? First and foremost, we know our team. We listen, help them with their challenges, and provide support, competitive wages, and benefits.

Are you experiencing economic growth in your market? Yes, mostly in the southern region.

How are you handling rising employee costs (payroll, minimum wage, healthcare, etc.)? We increased menu prices and looked at other efficiencies and cost-cutting strategies to handle the rising employee costs.

How do changes in the economy affect the way you do business? Depending on the change, we will take on more of a regional focus and drive value. How do you forecast for your business? We use prior years’ information along with brand goals and specific innovative and strategic planning. What are the best sources for capital expansion? Today, regional banks and equipment financing. Experience with private equity, local banks, national banks, other institutions? Why/why not? Our relationships have been built over time with both local and national banks that are familiar with the industry, our company, and the brands.

What laws and regulations are affecting your business, and how are you dealing with them? We effectively absorb minimum wage increases through better training to improve turnover and menu innovations. How do you reward/recognize top-performing employees? Our top-performing employees have clear goals and real incentives, and they collect their bonuses and system-wide recognition. What kind of exit strategy do you have in place? IPO. 

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Ryan Debin

“Creating atmospheres of optimism. That’s what we do with every business that we run.”

Chief Excitement Officer

Operator aims to create “smile-watt hours” Written by HELEN BOND

“If you were to ask any one of our managers of all our businesses, ‘What’s our goal?,’ they all know,” Debin says. “I just do things like that because it’s easy to remember.” Along with 11 My Gym centers and four Launch Entertainment Park locations open and one in development, Momentum’s franchise holdings include Abbott’s Frozen Custard and Retro Fitness. Momentum also owns independent businesses, Wimbledon Tennis & Pickleball Club and Club Elevate as well as The Newport Venture, an investment firm that acquires and manages commercial mixed-use real estate throughout Newport, Rhode Island. In all, the 45-year-old entrepreneur oversees 22 businesses across New England and New York. Debin’s operational approach takes a page from Life is Good, the inspirational retail brand founded to spread the power of optimism. He says Momentum has an informal—“soon to be formal”—partnership with the Life is Good Kids Foundation, which was founded by Debin’s close friend Steve Gross. “I just love their message. So at Momentum, we have a mission stolen from Life is Good, called ‘creating atmospheres of optimism,’” Debin says. “That’s what we do with every business that we run. We create those atmospheres for people to reach their full potential.”

RYAN DEBIN

Chief Excitement Officer Company: Momentum Enterprises/ Launch Entertainment No. of units: 11 My Gym Children’s Fitness Center, 4 (1 in development) Launch Entertainment Park, 1 Retro Fitness under development, 3 Abbott’s Frozen Custard Age: 45 Family: Wife; 4 kids Years in franchising: 13 Years in current position: 6 16 | Multi-Unit Franchisee | Issue 1, 2024

yan Debin is the “chief excitement officer” and driving force of the aptly named Momentum Enterprises Inc., a Boston-based asset management company backed by Arena Capital Partners. It’s all about community-centered concepts focused on family and fun. The nation’s largest multi-unit franchisee of My Gym Children’s Fitness Center and Launch Entertainment Park, Debin says he likes to “do things differently than most people.” For instance, Debin projects his multi-brand family entertainment portfolio revenue to hit $24,242,424.24 in 2024. To a numbers guy like Debin, a financial target that lines up with the operating year makes good sense.

The approach is fueled by Debin’s obsession with “smile-watt hours.” Think kilowatts of good-vibes energy bottled up as smiles. There’s even a running meter, which at last count was ticking toward 500,000 on the path to hitting 1 million smile-watt hours by the end of 2024. “Every single day, every time someone comes in for a birthday party at Launch, a birthday party at My Gym, or any interaction we have in the businesses that we operate, there is a chance for another smile-watt hour,” Debin explains. “It’s there as a reminder to my 500 staff that we have the opportunity to get hundreds if not thousands of those smile-watt hours every day.” As a kid in Orange County, California, Debin grew up attending birthday parties at a Medieval-themed amusement park and dreamed of owning entertainment parks. His

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Visit

www.owncheckersfranchise.com/mufranchise

or Call 888-913-9135 ©2024 Checkers Drive-In Restaurants, Inc. 4300 W. Cypress St., Suite 600, Tampa, FL 33607. 1. Checkers & Rally’s 2024 Franchise Disclosure Document (FDD). Written substantiation will be provided on request. This advertisement is not intended as an offer to sell, or the solicitation of an offer to buy, a franchise. It is for information purposes only. The franchisor, Checkers Drive-In Restaurants, Inc. is located at 4300 West Cypress Street, Suite 600, Tampa, Florida 33607, and is registered as file number F-4351 in the state of Minnesota. In New York, an offering can only be made by a prospectus filed first with the Department of Law, and such filing does not constitute approval by that Department. 20240046

Ryan Debin rewarding. It’s easier to have more of an impact on larger deals.”

PERSONAL

First job: Working for my father in the HVAC business. My first job out of college was in commercial real estate brokerage.

childhood aspiration would get its start on the East Coast when he headed to Boston College to study finance. After graduation, he remained in Boston and built a high-flying career in banking until the economic fallout from the Great Recession prompted him to explore franchising. Initially, it was a “purposeful and meaningful side investment.” His first venture was the 2012 acquisition of the My Gym location where his son was a member. “In 2017, the division I was a part of shut down, and it was scary for about one day,” Debin recalls. “I realized it was all going to be good because now I could do this hobby fulltime. One of the first things I did was create Momentum Enterprises.” With four My Gym centers already in the fold, Debin spent the next two years beefing up his central team and quickly making Momentum’s presence known in franchising. He added Launch and earned back-to-back nods as My Gym’s worldwide Franchisee of the Year out of more than 600 locations in 38 countries. Momentum’s penchant for prime opportunities continues. With ambitions to be a $100 million company in the next five years, Debin says he is open to other concepts as long as they fit “our bread and butter, which is family, fitness, and fun.” “Realistically, where most of our growth would be is in the higher volume businesses,” Debin says. “We know it’s hard work to open up and run a business. And as we grow, we’re learning that if it’s hard work to open and operate a business, it might as well be financially 18 | Multi-Unit Franchisee | Issue 1, 2024

Formative influences/events: My parents both owned small businesses. My father was an entrepreneur with an HVAC business, and my mother was a doctor with a private practice. Just watching how they operated influenced me, giving me a love for business and inspiring me to want to do influential things. My dad greatly influenced me on the personal development side—Stephen Covey, Dale Carnegie, Napoleon Hill, Tony Robbins, and The E-Myth Revisited. He was big into all of that. It was an influence that my parents had on me that shaped a lot of my thinking. Key accomplishments: Early in my career, at age 30, I was the youngest person ever to be promoted to senior executive in banking at Anglo Irish Bank. I was also the youngest member of the board of directors of Horizons for Homeless Children, a nonprofit dedicated to supporting the lives of young homeless children and their families. Horizons has been a big part of my life. No one on the board knew anything about real estate, so they tapped me on my shoulder and said, “We need to figure something out, and you’re our guy.” I created a partnership with a private company. We bought land and got it subdivided, permitted, and built a new 120,000-squarefoot headquarters for Horizons as part of a public-private partnership. It opened in 2021 and was a pretty spectacular accomplishment. In business, my greatest accomplishment has been forming Momentum Enterprises, which was the driving force that allowed us to build, open, and operate these businesses.

ing about Boston, the culture, or the customs. So in a way, it was very good because I got to teach them the culture of how things are done in America. It also allowed me to see deals and be part of underwriting deals that I wouldn’t have otherwise seen. We were the most dynamic company in that space. It was like “The Wolf of Wall Street.” If bankers could be rock stars, we were rock stars. Best business decision: Forming Momentum Enterprises. Hardest lesson learned: Taking on too much too fast. Work week: 80 to 100 hours a week. Exercise/workout: Lifting weights. Best advice you ever got: To read the The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It by Michael E. Gerber. What’s your passion in business? Obsessive accumulation of smile-watt hours (units of measurement for good vibes). How do you balance life and work? My kids and family are involved with my business, so it doesn’t feel like work. Guilty pleasure: Fast cars. I like the adrenaline. It’s a passion. It’s fun. Our newest Launch location, which we’re building in North Attleborough, Massachusetts, will be the first location to have the F1 simulators that professional drivers use. Favorite book: Many favorites: The E-Myth Revisited by Michael E. Gerber; Think and Grow Rich by Napoleon Hill; Robert Kiyosaki’s Rich Dad Poor Dad; The 7 Habits of Highly Effective People by Stephen R. Covey; and Dale Carnegie’s How to Win Friends and Influence People. Favorite movie: “Braveheart.”

Next big goal: Successful opening of Launch North Attleborough.

What do most people not know about you? I ran the Boston Marathon 20 years in a row. My last year was 2019. It wasn’t held in 2020 because of the pandemic, and that’s when I stopped. Twenty years was a nice round number.

First turning point in your career: Going from brokerage to banking. I worked for a big commercial broker shop when I was 21 and didn’t know anything. I still didn’t know anything when I was 22 and joined Anglo Irish Bank, but it was brand new. They had just come here from Ireland, and I was the second American they hired. They knew noth-

What did you want to be when you grew up? Own entertainment parks. As kids, we would go to this King Arthur-themed park called Camelot in Anaheim, California, not far from Disneyland, where everybody wanted to go on their birthday. It had an arcade, mini

Biggest current challenge: Attracting and retaining resources, including labor and capital.

Pet peeve: People parking in my parking spot. Making the same mistake twice.

Ryan Debin Do you have brands in different segments? Why/why not? Yes, My Gym Children’s Fitness, Club Elevate, Retro Fitness, Wimbledon Tennis & Pickleball Club, Newport Venture (Airbnb/hospitality), and Launch Entertainment. How is the economy in your region(s) affecting you, your employees, your customers? The economy hasn’t had a significant impact on business. We’ve seen some slower volume but not a dramatic change. Are you experiencing economic growth in your market? Yes. How do changes in the economy affect the way you do business? There is more of a focus on value versus price. golf, and a water park. I just loved it. And then I ended up doing this for my livelihood. Last vacation: Europe. Person you’d most like to have lunch with: Jessie Itzler.

MANAGEMENT

Business philosophy: To have high-quality people producing high-quality products in a high-quality environment. Management method or style: Perfect blend of a resource and a coach to push people but not micromanage. Greatest challenge: Consistently getting the most out of everyone. How do others describe you? Passionate. Have you ever been in a mentor-mentee relationship? What did you learn? Yes. My mother and father would be my top two and probably had the strongest impact on me. I learned everything from demeanor and attitude to thought process and organization. If you ever met my mother and father, you’d know I’m the perfect blend. Also, Steve Gross, founder of the Life is Good Kids Foundation; Kate Barrand, president and CEO of Horizons for Homeless Children; and Jeff Feingold, the former head of the Fidelity Magellan Fund. I’m on the board of Hope and Comfort, a nonprofit Feingold founded that supplies essential toiletries to those in need. These are some of the other people who have impacted my life. One thing you’re looking to do better: A tighter focus on the details. How you give your team room to innovate and experiment: Don’t micromanage, and empower people to do what they know is right. 20 | Multi-Unit Franchisee | Issue 1, 2024

How close are you to operations? Very close. What are the two most important things you rely on from your franchisor? Leadership team and instincts. What you need from vendors: Flexible financing terms. Have you changed your marketing strategy in response to the economy? How? Not in response to the economy, but my strategy has changed over time because each year’s spend goes to different things. How is social media affecting your business? Huge effect because it’s the audience I’m targeting that’s watching. How do you hire and fire? We don’t fire. We only unhire those who don’t fit in our core values. How do you train and retain? Through training and development and rewarding for positive performance. How do you deal with problem employees? Work with them to come around. Fastest way into your doghouse: Don’t do what’s expected of you.

BOTTOM LINE

Annual revenue: More than $18 million. 2024 goals: $24,242,424.24. Growth meter: How do you measure your growth? Measure on three-month, sixmonth, and 12-month revenue and same-store sales year over year. Vision meter: Where do you want to be in five years? 10 years? In five years, I expect to be a $100 million revenue company and have broadened our reach beyond New England. In 10 years, the sky’s the limit.

How do you forecast for your business? Historical factors and the percentage of growth we’ve attained. What are the best sources for capital expansion? Alternative financing and private lending. Experience with private equity, local banks, national banks, other institutions? Why/why not? Local banks have been good over the years, and we’ve had a good experience with private lenders. What are you doing to take care of your employees? Compensate with raises and introduce Nectar, an employee rewards platform that provides incentives for a job well done. Points can be redeemed for gifts. How are you handling rising employee costs (payroll, minimum wage, healthcare, etc.)? The best we can. Pass more on to the consumer to maintain profitability. What laws and regulations are affecting your business, and how are you dealing with them? Minimum wage laws and employment laws affect us, but we deal with them as they come. How do you reward/recognize top-performing employees? Incentive programs. What kind of exit strategy do you have in place? Working to create a business that runs itself and looking for others to partner with in the next three to five years as we continue to grow. 

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Bryant Greene

“A lot of people look to me for guidance and direction on personal and professional levels, and that motivates me.”

Focused on Others

Multi-unit operator embraces a duty to care Written by HELEN BOND

seniors who rely on home care to stay safe and independent in their communities. He also supports a variety of causes, including Alzheimer’s outreach, children’s groups, and grassroots community efforts. Greene fell into franchising after meeting a franchise broker at a career fair. It was 2009, and he had spent more than a year pounding the pavement to find his next career move after losing his finance job at Comcast. At the time, talk of opening up his own business during the Great Recession sounded crazy to Greene, but something made him stop and listen. When presented with four turnkey concepts, senior care appealed to him. Greene’s early decision to become Medicaid-certified rather than rely on just private pay catapulted his success. “Here I am almost 14 years later, and I’m still doing it,” Greene says. “It’s been really interesting, exciting, and stressful at times, but it’s been a ride. It’s definitely been a ride.” Named Franchisee of the Year twice by his Roseville, California, senior care services brand, Greene was also recognized as a 2023 Franchisee of the Year by the International Franchise Association.

BRYANT GREENE

Owner

Company: Always Best Care Philly and Delaware No. of units: 15 Always Best Care Senior Services Age: 54 Family: 1 daughter Years in franchising: 13.5 Years in current position: 13.5 22 | Multi-Unit Franchisee | Issue 1, 2024

ryant Greene is driven to take care of those in need. He operates 15 Always Best Care Senior Services territories in Philadelphia and Delaware. With nearly 1,000 employees, he is the company’s largest and top revenue-producing franchisee. He also brings his compassion to bear at Uncle Beez Rescue Farm, a 13-acre nonprofit rescue farm he runs in south New Jersey where he cares for unwanted and discarded horses, donkeys, and other animals. “I’ve always felt like I could connect better with the underdog,” Greene says. A native Philadelphian, he serves on the Pennsylvania Home Care Association board and uses his platform to advocate for vulnerable

He has been the longtime host of “Did You Know,” a public affairs radio and regional television program in Philadelphia. Each year, he supports the fine arts, schools, and community organizations. “What inspires me is that, as a black, minority business owner, I’ve been able to build a multicultural and intergenerational kind of a vibe,” Greene says. “But what motivates me is the fact that I make decisions that guide people’s livelihoods. A lot of people look to me for guidance and direction on personal and professional levels, and that motivates me.” Greene says the key to his success has been his ability to listen to people. He uses Survey Monkey to get a “pulse check” and gather ideas from his team. “I recognize I don’t have all the best ideas. And I think that’s my superpower, to recognize that I have to understand how people perceive me and how they perceive this job,” he says.

The Human Bean Franchising Done

285 Locations

0% Royalty

Open Or In Development

$1,251,709 TOP QUARTILE AUV $884,304 AUV 3 (2022 FDD ITEM 19)

159 currently open, 56 signed franchise agreements but not yet opened, and another 70 obligated by Area Developers. Franchisor derives revenue from required purchases of coffee and other supplies from the franchisor or its designated suppliers. AUV is average unit volume for calendar year 2022. 53 stores surpassed and 56 stores made less than the listed AUV. Median was $859,940. Some outlets have sold or earned this amount. Your individual results may differ. There is no assurance you'll sell or earn this much. For more information, see Item 19 of the Franchise Disclosure Document (FDD). $1,251,709 is the top quartile average unit volume of the best-performing franchisees in 2022. 11 surpassed and 16 made less. Median was $1,207,887. Contact us at franchising@thehumanbean.com for franchise sales.

1 2 3

Bryant Greene As a leader, Greene says it’s important to share his mistakes, so his employees don’t feel they have to hide theirs. “I always tell people that if I find out that you have a situation that you didn’t bring to me, it will be a different conversation versus you bringing it to me and us working on it together,” he says. “That’s a trust, especially if you’re in leadership.”

PERSONAL

First job: My very first job was apprenticing for my grandfather. I worked as a painter and general contractor. Formative influences/events: A Jeffrey Osborne concert (where After 7 opened) with Mom. We sat up front and went backstage afterward to meet him. We’ve been going to concerts together since I was a little kid, so that’s kind of our center in a lot of ways. These days, we vibe on old-school music and sometimes plays and shows. I’m a big showman too and have been in a couple of productions myself. Other formative events are the times spent talking with my grandparents in the kitchen. Key accomplishments: Our team is made up of people from many cultural backgrounds and spans multiple generations. I’m proud of that diversity. Biggest current challenge: Challenges with staying fully staffed continue to be at the forefront of business as the labor shortage wears on. Next big goal: Open a retail cannabis dispensary. I’ve been approved for a license. It’s going to be a 4,000-square-foot retail cannabis spot called Uncle Beez Greeneries. The tagline is going to be: “The grass is always greener at Uncle Beez.” First turning point in your career: I completed my MBA at Philadelphia University in 1996. I had already studied accounting and finance during my undergrad years, but adding a master’s in business management and international business was a great personal accomplishment. Best business decision: Hands down, the best business decision I ever made was to open a senior care business with Always Best Care. Hardest lesson learned: Many people are very trusting by nature, but business will often teach us the hard way that not everyone can be trusted, even some family. Work week: Seven days a week. Exercise/workout: The best exercise I get is working on my rescue farm. In fact, I just 24 | Multi-Unit Franchisee | Issue 1, 2024

came in from feeding several of the animals and checking on my new draft horses. There’s always something to do on a farm. Best advice you ever got: Every success or failure is an experience. What’s your passion in business? Inclusion and being able to motivate and mentor people. How do you balance life and work? Ah, the elusive work-life balance. You have to stay vigilant about that, or work can have a way of taking over. I like to spend time on my farm. Guilty pleasure: Popping hot air popcorn. Favorite book: Go Tell It on the Mountain by James Baldwin. Favorite movie: “The Wiz.” What do most people not know about you? Although I’m very active with many community organizations and host my own TV and radio shows, I consider myself a loner. Pet peeve: Liars. What did you want to be when you grew up? A great father. Last vacation: Colorado Springs. Person you’d most like to have lunch with: My daughter.

MANAGEMENT

Business philosophy: Teamwork makes the dream work. Management method or style: I believe strongly in leading by example. Greatest challenge: While having the opportunity to lead an intergenerational workforce is one of my favorite things about my business, it can be very challenging to communicate in a way that each generation will gravitate toward and respond to. How do others describe you? I’m a caring person who has the opportunity to mentor many people in my business and personal life. Others would describe me as a coach and a giver of time, advice, and compassion. Have you ever been in a mentor-mentee relationship? What did you learn? Yes, these relationships are so important. I’ve been in several and am always reminded to listen to others and spend more time observing than talking. When I am not sure if the message is going to come across to all generations, I do a pulse check using Survey Monkey and ask intentional and pointed questions about a topic to get a read on what my team wants.

One thing you’re looking to do better: Focus on work-life balance. How you give your team room to innovate and experiment: By making folks included in the discussion and feeling comfortable to share their ideas voluntarily. If it’s too quiet, I start calling on people to engage and ask the direct questions. Most people who have worked for me will give honest feedback because they know it’s a safe place. How close are you to operations? I’m not heavily involved with the operations team. Instead, I challenge senior leadership to keep their fingers on the pulse of what is happening in the business and the industry. What are the two most important things you rely on from your franchisor? Respect and autonomy. What you need from vendors: My vendors will tell you that I prefer business category exclusivity. Have you changed your marketing strategy in response to the economy? How? Yes, I’ve become more focused on community outreach and getting involved with more local groups for visibility and recruitment. We support all kinds of community events, such as reentry programs, Toys for Tots, turkey drives, homeless shelters, and the Walk to End Alzheimer’s to name a few. How is social media affecting your business? Social media is a positive asset for the business. We use these platforms to share our community events and let our followers know that we care about the communities they live in. It has the additional effect of getting more people involved with those organizations as well. How do you hire and fire? Candidates meet with the hiring manager and HR. I am the last interview. I engage in behavioral and integrity questions. How do you train and retain? We do a new hire orientation, and all employees go through it. Retention is an ongoing goal. Our leadership team does its best to engage, communicate, and, where appropriate, incentivize with PTO, small electronics raffles, and concert, sports, and event tickets. How do you deal with problem employees? Consistent communication and performance management. Fastest way into your doghouse: Disorganization, apathy to position, lukewarm enthusiasm.

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*AUV refers to average unit volume of unaudited gross sales shared by the top 25% of 303 Wienerschnitzel restaurants open for the entire calendar year of 2022. Your estimated sales and operating costs can and will vary. This information is not an offer to sell you a franchise. We will not offer you a franchise until such time we have complied with FTC disclosure requirements, and you have met our application and pre-approval process to be awarded a franchise license. Please read Item 19 in our Franchise Disclosure Document. **New franchisees must pay initial franchise fees and meet development schedule to achieve incentives. Qualified candidates and domestic U.S. markets will be reviewed on a case-by-case basis. These incentives are only available for franchising in the United States. Please request our Franchise Disclosure Document for terms and conditions on this limited-time, limited-incentive offer.

Bryant Greene BOTTOM LINE

Annual revenue: $27 million. 2024 goals: $31 million. Growth meter: How do you measure your growth? I measure business growth against key performance indicators. Some of the most important ones for me are the number of “start of cares,” re-certs, terminations, missed visits, and why. Vision meter: Where do you want to be in five years? 10 years? Semi-retired and spending more time on my farm. Do you have brands in different segments? Why/why not? Not yet, but I’m looking at opening a retail cannabis dispensary. How is the economy in your region(s) affecting you, your employees, your customers? People are cautious consumers. Are you experiencing economic growth in your market? Yes, but more growth in one market over another. In some instances, the Medicaid reimbursement is better, which allows us to pay the direct care workers more. How do changes in the economy affect the way you do business? Budget preparation and spending. How do you forecast for your business? Based on historical data and current market trends. What are the best sources for capital expansion? In my experience, I’ve found that grants and government programs are good sources for capital, particularly working opportunity tax credits and on-the-job training grants. Experience with private equity, local banks, national banks, other institutions? Why/why not? Yes, great credit. What are you doing to take care of your employees? Paid incentives, event tickets, acknowledgment. How are you handling rising employee costs (payroll, minimum wage, healthcare, etc.)? By keeping a razor-sharp focus on expenses. What laws and regulations are affecting your business, and how are you dealing with them? EVV compliance. A leadership task force. How do you reward/recognize top-performing employees? Money, acknowledgment, promotions. What kind of exit strategy do you have in place? Pending.  26 | Multi-Unit Franchisee | Issue 1, 2024

Steve Leibsohn

“Arizona is in a sweet spot as we are a fast-growing state. This directly translates into increased sales.”

Twists and Turns

Doctor becomes brand ambassador for Wetzel’s Pretzels Written by HELEN BOND

“I worked at Wetzel’s on the weekends to relax,” Leibsohn recalls. “I loved the simplicity of the operation, which allowed me to focus on the customer.” Sidelined by a second back surgery in 2001, Leibsohn retired from medicine and went back to school to earn an MBA. Slowly and successfully, the newly minted entrepreneur expanded his pretzel empire, adding one to two stores a year across Wetzel’s flexible formats over the next 25 years. Leibsohn gets energized by finding venues and opening new stores, and he was most recently tapped to expand the brand’s latest innovative take on snacking, Twisted by Wetzel’s. The 2023 opening of the new streetside concept in Surprise, Arizona, is Wetzel’s second location and the first unit operated by a franchisee. It’s a fitting move for the brand ambassador, who was recognized as an IFA 2022 Franchisee of the Year. “I believe you cannot be an absentee owner and must give the business 110% of your effort,” Leibsohn says. “If you decide to focus your attention on other business endeavors, then you are leaving a significant amount on the table.”

STEVE LEIBSOHN

Owner

No of Units: 35 Wetzel’s Pretzels, 2 food trucks, 1 Twisted by Wetzel’s Age: 65 Family: Wife; 1 son; 1 daughter Years in franchising: 25 Years in current position: 25 28 | Multi-Unit Franchisee | Issue 1, 2024

teve Leibsohn’s transition from delivering babies as a busy OB-GYN to an award-winning, pretzel-slinging entrepreneur may seem like a wild career move, but the twists and turns are the point. “I truly feel you are always in the exact place you are supposed to be at any given time,” says Leibsohn, who oversees a portfolio of more than 35 Wetzel’s Pretzels in Arizona. Leibsohn was a practicing physician when he first experienced a Wetzel’s pretzel while on vacation in San Diego. It was a tasty memory, so when he spotted the franchise’s classified ad in the Arizona Republic in 1998, he answered the call to introduce the iconic snack brand to the Grand Canyon State. Leibsohn signed on for a three-pack on the spot.

Known for being a caring leader and committed philanthropist with a big heart, Leibsohn has loved being a one-brand man, who made pretzels popular in his home state. “In Arizona, when I tell people I own and operate the Wetzel’s Pretzels, the kids treat you like a rock star,” he says.

PERSONAL

First job: Obstetrician/gynecologist. Formative influence/events: I obtained an MBA from Thunderbird School of Global Management in 2003. Key accomplishments: Retention of managers and employees. Many of my present managers have been in the organization for more than 20 years. In fact, my original manager at my first franchise in Scottsdale Fashion Square is still working at that location. Awards: Franchisee of the Year 2022, International Franchise Association;

Steve Leibsohn

“I believe you cannot be an absentee owner and must give the business 110% of your effort. If you decide to focus your attention on other business endeavors, then you are leaving a significant amount on the table.”

Multi-Unit Franchisee of the Year, Wetzel’s Pretzels; Trailblazer of the Year, Wetzel’s Pretzels. Biggest current challenge: Labor and food costs. Next big goal: Giving back to the community on a weekly basis. My desire is to take the food truck out and hand out free pretzels at various charitable organizations. Best business decision: I committed to opening up three Wetzel’s Pretzels in 1998 after reading an ad looking for the first Wetzel’s Pretzels franchisee in Arizona. Hardest lesson learned: I trust you until you give me a reason not to trust. Work week: The day is always full of surprises. You have to be able to roll with the punches as every day is different. Be flexible. In our business, the weekends determine our overall success. Exercise/workout: I have a personal trainer two times a week. Best advice you ever got: Your gut never lies. Collect all the data you need, but at the end of the day, use your instincts to make important decisions. What’s your passion in business? Creating leaders within my organization. I love to promote from within and see the growth of each individual, maximizing their potential. My director of operations started with me when she was 16. 30 | Multi-Unit Franchisee | Issue 1, 2024

How do you balance life and work? I believe that they are connected. If you are happy with your life, you will be more productive at work. When both are in sync, you will have inner peace. Guilty pleasure: Eating Cinnamon Bitz. They are addicting. Favorite book: Good to Great by Jim Collins. Favorite Movie: “Toy Story.” I love nurturing the inner child filled with openness, joy, and curiosity. What do most people not know about you? I love to play in Texas Hold’em poker tournaments. Pet peeve: Not telling the truth. What did you want to be when you grew up? A physician. Person you’d most like to have lunch with: Charlie Munger. I love his quote, “I think that a life properly lived is just learn, learn, learn all the time.”

MANAGEMENT

Business philosophy: Do not be greedy. Take care of your employees. Management method or style: Relationship oriented. I focus on motivating and developing people. Greatest challenge: Labor and food costs. How do others describe you? A caring leader with a huge heart.

Have you ever been in a mentor-mentee relationship? What did you learn? I recently hired a corporate executive to lead my company. To make it work, I needed to deprogram his corporate brain. The corporate mindset does not work in a self-owned, medium-sized business. He taught me that we need to implement more written procedures and policies. One thing you’re looking to do better: Change our bonus system from subjective to a pay-for-performance structure. How you give your team room to innovate and experiment: We have weekly Zoom meetings to review the past week and look to the future. I believe in open and authentic communication. How close are you to operations? I feel that operations are the key to your overall success. The minute you stop caring and are not 100% all in, you need to step aside. What are the two most important things you rely on from your franchisor? Marketing and supply chain management. What you need from vendors: Anticipation of our needs. Have you changed your marketing strategy in response to the economy? How? I feel that social media is very important along with loyalty apps.

Expand Your Existing Franchise Portfolio! About a MY SALON Suite Franchise:

93.5%

Average Occupancy

325+

Locations

• Semi-Absentee: No on-site staff

46.4%

EBITA

250+

Under Development

*Per the 2023 Franchise Disclosure Document. The following figures are only estimates, and there is no assurance you will do as well if you rely upon our figures. If you rely upon these figures, you must accept the risk. Average gross sales are based on the gross sales reported by 171 locations, and average owner benefit is based on the unaudited operating statements supplied by the 171 locations open for the entire year ending December 31, 2022. Average owner benefit is calculated based on the 2022 year-end benchmark study from Item 19 of the 2023 Franchise Disclosure Document.

• Multi-unit expansion available nationwide • Recession Resistant

"You're making an investment that helps a lot of other people start their small businesses for themselves. It allows them to check that box of what their dreams and goals are for their business." Jenn Navarro, Franchisee Suburban Square, Lawrence Park Abington and Conshohocken, PA

Chris Davenport: chris.davenport@propelledbrands.com • 214-346-5644 MYSALONSUITE.COM MY SALON Suite is part of the Propelled Brands portfolio which is the Franchisor of NerdsToGo® and FASTSIGNS® International, Inc.

Steve Leibsohn

How is social media affecting your business? The more your business is seen on Instagram, the better. It is free advertising. How do you hire and fire? There is a great app for hiring: Landed App. It is specific to the restaurant industry. It sets up interviews for candidates and uses AI. It has been a game changer for us. Firing is done on a case-tocase basis. How do you train and retain? We have recently switched our training manuals to the 1Huddle App. Everything can be done on the phone or an iPad. Paper manuals are no longer sitting on the back shelf, collecting dust. Retaining employees is our passion. We love to promote and reward our star employees. The bakers are key in my business. How do you deal with problem employees? We attempt to understand both sides of the story. We will always have an in-person meeting to explain the situation. A written warning, if warranted, will be given with the hope that the incident was a one-time situation. Clear and open communication, allowing both sides to be heard, is a necessary part of the process. Listen, listen, and listen. Fastest way into your doghouse: Lie, cheat, or steal.

BOTTOM LINE

Annual revenue: $28 million. 32 | Multi-Unit Franchisee | Issue 1, 2024

2024 goals: Give back to the community. Growth meter: How do you measure your growth? In 2024, we want our revenue to grow 3% to 4%. There are headwinds to the EBITDA with rising rents, labor, and food costs. Vision meter: Where do you want to be in five years? 10 years? I want to continue to grow my food truck and catering business. Do you have brands in different segments? Why or why not? I prefer simplicity; I want to build on what I know is a proven business model. How is the economy in your region affecting you, your employees, your customers? Arizona is in a sweet spot as we are a fast-growing state. This directly translates into increased sales. Are you experiencing economic growth in your markets? Yes. There are a lot of lifestyle centers being constructed, which is a substitute for the mall and a growth opportunity. How do changes in the economy affect the way you do business? We are basically recession-proof as people will still go to the malls and purchase food. We are an impulse buy as opposed to a destination purchase. We are still a great value. How do you forecast for your business? I predict sales in 2024 will increase slightly from 2023. There was a definite decrease in

sales from 2022. It will be hard to duplicate 2022 since it was our best year ever. What are the best sources for capital expansion? Self-funding. What are you doing to take care of your employees? We are a big family. If you authentically care about your employees, your business will be in a great spot. Reward your superstars with monthly bonuses. How are you handling rising employee costs (payroll, minimum wage, healthcare, etc.)? We have been increasing our prices two times a year. Also, the tip feature adds approximately $2 an hour to the paycheck. What laws and regulations are affecting your business, and how are you dealing with them? The minimum wage keeps increasing. Arizona went up to $14.35 in January. This has a direct effect on increasing the existing employee’s wages. Thus, the prices will continually need to rise to help with the increase in operational costs. How do you reward/recognize top-performing employees? I believe in monthly bonuses and big Christmas bonuses. I also have an emergency fund for employees. If the employee has a financial hardship, we will assist with their needs by either giving them an extra bonus or giving them a low-interest loan. The key ingredient for success is one word: caring. 

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Join our Franchise Family sharing the fun and craveability of the tropics to Inspire Better.® tropicalsmoothiefranchise.com | (770) 580-2333 *$1,245,078 Top 50% Average Net Revenues. $992,613 System Wide Average Net Revenues. Based on our fiscal year ending 12/25/2022 and includes 950 Restaurants that were open for at least 12 months as of 12/25/2022. Excludes nontraditional locations and Restaurants that were not open for at least 357 days in 2022. This information appears in Item 19 of our Franchise Disclosure Document. Your results may differ. There is no assurance that you will do as well. This information is not intended as an offer to sell or the solicitation of an offer to buy a franchise. It is for information purposes only. The offering is by prospectus only. Currently, the following states regulate the offer and sale of franchises: California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota (File No. F-9894), New York, North Dakota, Oregon, Rhode Island, South Dakota, Virginia, Washington and Wisconsin. If you are a resident of or want to locate a franchise in one of these states, we will not offer you a franchise unless and until we have complied with applicable pre-sale registration and disclosure requirements in your state. New York State Disclaimer: This advertisement is not an offering. An offering can only be made by prospectus filed first with the Department of Law of the State of New York. Such filing does not constitute approval by the Department of Law. CALIFORNIA DISCLAIMER: THESE FRANCHISES HAVE BEEN REGISTERED UNDER THE FRANCHISE INVESTMENT LAW OF THE STATE OF CALIFORNIA. SUCH REGISTRATION DOES NOT CONSTITUTE APPROVAL, RECOMMENDATION OR ENDORSEMENT BY THE COMMISSIONER OF CORPORATIONS NOR A FINDING BY THE COMMISSIONER THAT THE INFORMATION PROVIDED HEREIN IS TRUE, COMPLETE AND NOT MISLEADING.. ©2024 Tropical Smoothie Cafe, LLC, 1117 Perimeter Center West, Suite W200, Atlanta, GA 30338.

Karl Malchow

“Invest time and patience with people. Deep down, most people want to be good at their jobs. ”

To the Top

Former delivery driver enjoys franchise success Written by HELEN BOND

In late 2018, Malchow and his brother Mac Malchow teamed up with business partner Adam Oldenburg to purchase a Toppers Pizza in Lawrence, Kansas. Malchow immersed himself into the group’s Renegade Pizza venture as the operating partner while his brother and Oldenburg retained their corporate roles. Success as a top-performing store was swift, spurring the opening of four more restaurants in the Midwest over the next five years. Malchow earned Franchisee of the Year honors in 2022 and 2023 and serves as a voice for his fellow franchise owners as a member of Topper’s franchise advisory council. His business partners, who also started with Toppers as delivery drivers, continue to give Malchow unique insights into the franchisor/franchisee relationship. Oldenburg was named Toppers’ CEO in 2023 while Mac Malchow serves as the chain’s vice president of development. With plans to double the business in size in the next five years, Malchow continues to heed the early lessons learned as he develops his group of young team members.

KARL MALCHOW

Owner

Company: Renegade Pizza LLC No. of units: 5 Toppers Pizza Age: 35 Family: Partner Leah Kennedy; 1 daughter, Delilah, 5; partner’s daughter Katy, 10 Years in franchising: 5 Years in current position: 5 34 | Multi-Unit Franchisee | Issue 1, 2024

ward-winning Toppers Pizza multi-unit franchisee Karl Malchow got his start with the rapidly emerging chain when he took a job as a delivery driver while attending college at the Milwaukee School of Engineering. Malchow was a quick study when it came to pizza. After accepting a role as an assistant manager in Toppers’ management program, he worked his way up to general manager and supervisor over multiple corporate restaurants. He eventually transitioned to become a franchise business coach for the Whitewater, Wisconsin-based brand. “Through all of my roles, I became very intimate with the model and what made restaurants and franchisees successful,” says Malchow, 35.

“You won’t go anywhere in this industry without a great team surrounding you that believes in the company’s vision,” Malchow says. “This rings true for your franchise company and the franchisor as a whole. Beyond that, I make it a mission to stay aligned with my franchisor leadership team. If you have a great working relationship with your franchisor, you can accomplish awesome feats.”

PERSONAL

First job: My first job was at a supper club in northern Wisconsin. I was a dishwasher and started at 15 years old. My brother had to drive me to work every day because I didn’t have a license yet. Luckily, he worked there as well. Formative influences/events: My biggest influence in life has always been my older brother. He is extremely hard working and caring. However, he also is very candid and transparent. He will do whatever you need if you hold up your end of the deal whatever that may be. Mac has always been very driven and has an extensive list of accomplishments that have pushed me to try and be my best self.

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*Figure reflects the average annual Gross Revenues for 105 of the 122 franchised Bonchon restaurants in the system that were in operation from January 1, 2022 through December 31, 2022 (each a “Mature Restaurant”), as published in Item 19 of Franchise Disclosure Document dated March 7, 2023, as amended June 12, 2023. Of these 105 Mature Restaurants, 45 (43%) met or exceeded the 2022 yearly average Gross Revenues during the reported period, with the highest Gross Revenues earned being $3,785,506 and the lowest Gross Revenues earned being $424,677. The financial performance representation contained in Item 19 of our Franchise Disclosure Document dated March 7, 2023, as amended June 12, 2023, also includes the average and median annual Gross Revenues information for our Mature Restaurants in operation in the United States during the 2019, 2020 and 2021 fiscal years. A new franchisee’s results may differ from the represented performance. There is no assurance that you will do as well, and you must accept that risk. ** 5 year growth rate is based on number of units for the year ended December 31, 2022

Karl Malchow

“You won’t go anywhere in this industry without a great team surrounding you that believes in the company’s vision. This rings true for your franchise company and the franchisor as a whole. Beyond that, I make it a mission to stay aligned with my franchisor leadership team. If you have a great working relationship with your franchisor, you can accomplish awesome feats.” Key accomplishments: I am a three-time Manager of the Year nominee and a Toppers Road Dawg of the Year recipient. I’ve won various sales-increase and record-year awards and a President’s Award. My biggest achievement would be the back-to-back Franchisee of the Year awards I received in 2022 and 2023. Biggest current challenge: Staffing is the biggest current challenge we are facing right now. Recruiting top talent for an aggressively expanding business is always a challenge. Next big goal: The biggest thing we are working on right now is getting a location opened in the Manhattan, Kansas, market. First turning point in your career: When I became a general manager for Toppers Pizza, I knew I was going to be doing this for a long time. I was obsessed with the numbers. I learned so much in that first year about running a business and developing people. It also helped me more clearly define what I wanted to do long term for a career. During that period was the first time my brother and I really started planning to become franchisees someday. Best business decision: The best business decision I ever made was partnering with guys I trust and respect. Mac Malchow, my brother and Toppers’ vice president of development, and Adam Oldenburg, Toppers’ CEO, were those guys. We can challenge each other and 36 | Multi-Unit Franchisee | Issue 1, 2024

push to achieve more because of the relationships we have built over time. We don’t always agree and have had plenty of butting heads, but we all keep focused on the overall goal and don’t get caught up in finger-pointing or making excuses for coming up short on a goal. We expect our very best work from each other, and most importantly, we celebrate each other’s wins. Hardest lesson learned: I feel like I have a lifetime of hard lessons learned—ha ha! At times, I probably worked much harder than I needed. I always have operated at a high level when the pressure is on and things are difficult. However, when things get easier, I can lose sight of the most important things to accomplish each week. As many people have said, “Proper planning prevents poor performance.” I have learned multiple times to always be planning for the next thing.

I personally can’t work behind a desk all the time. I need to be on my feet and moving. Best advice you ever got: Over the years, I have received a tremendous amount of support and advice from various people in lots of different roles. If I were to pick one that stands out, though, it was a piece of advice that helped me the most when I first started as a manager. When I was a teenager, I worked with my father a lot doing construction work. He always thanked everyone for their hard work at the end of the day. He would say, “The mistakes don’t matter anymore; it’s the end of the day. Always thank your workers for what they did that day. They will always try their best if you show you appreciate them.”

Work week: Currently, I oversee three of our five locations. My week is split between meetings with my managers, visits to each location to determine our biggest needs, meetings with my business coach, time to review our previous week’s results, and time to plan for the upcoming weeks and months.

What’s your passion in business? Creating opportunities for others. My partners and I have always been very aligned on this value. Opportunities came to us because we worked hard but also because people saw potential in us and invested their time and energy in making sure we were always striving to improve and achieve more. We are a small and extremely ambitious group, and we want to provide opportunities and rewards to those who trust and join us on this adventure.

Exercise/workout: If I said I hit the gym regularly, the noise I make when bending over to tie my shoes would beg to differ. The job and my 5-year-old do keep me active every week.

How do you balance life and work? This is always a challenge. The biggest thing I do is set boundaries. When I’m at work, I need to be invested in that. When I am at home, I need

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Karl Malchow Pet peeve: Finger-pointing. Mistakes happen, things get messed up, and communications break down at times. The focus needs to be on fixing the mistakes, not necessarily trying to always figure out who is to blame. What did you want to be when you grew up? I wanted to be an architect who designed resort hotels. Last vacation: My girlfriend and I spent a few days in Keystone, Colorado, enjoying the mountains. Person you’d most like to have lunch with: Tom Segura. He’s a very successful comedian and also a monster in business. It would be a great time to pick his brain in between outbreaks of laughter.

MANAGEMENT

Business philosophy: Take care of the people who work for you. Provide them with skills they can take further in life with them even if they won’t be working with you forever. If you can do that, those people will take care of your customers.

to be at home. Anything that has not gone as planned at the locations can be handled when I get back to work. At times, this seems near impossible, so I focus on developing the right people to handle issues when I am not accessible, so I am needed less. Always be focused on developing someone who will replace you, so you can protect your own time. It’s a resource we can’t get back. Guilty pleasure: I like to play computer games but not the usual suspects. I enjoy games like “American Truck Simulator,” “Farming Simulator,” and “Construction Simulator.” Is there a theme developing? I even have a steering wheel, shifter, and pedals to enhance my simulating experience. Nothing like finishing a day at my real job just to make some cross-country runs in my fantasy 18-wheeler or harvesting a field of wheat in my combine. Favorite book: The Stand by Stephen King. Favorite movie: “Good Will Hunting.” What do most people not know about you? I like to think I’m artistic. I enjoy drawing and painting, and they don’t turn out half bad sometimes. 38 | Multi-Unit Franchisee | Issue 1, 2024

Management method or style: Care and candor. Invest time and patience with people. Deep down, most people want to be good at their jobs. They want to feel accomplished and appreciated. Don’t sweat mistakes. They are the cost of business and learning. Approach each situation with a clear head and empathy, but don’t be afraid of hard conversations. Not correcting bad habits isn’t empathy; it’s a disservice to your team. Greatest challenge: Fully trusting someone and removing the safety net is my hardest challenge. I worry they might be overwhelmed, so I need to feel more comfortable letting go of responsibilities. They are always capable. That’s why I put them in the position in the first place. How do others describe you? I most often hear that I am extremely patient with people. I don’t lose my cool, and I can’t remember the last time I raised my voice at someone. It’s just not necessary. Have you ever been in a mentor-mentee relationship? What did you learn? Nothing official. I just tend to surround myself with people who are more successful than I am. I’ve heard it said multiple times, “If you’re the smartest person in the room, you’re in the wrong room.” One thing you’re looking to do better: Routine! I am great at reacting. Always able to solve a problem or rise to a challenge, I struggle

to stay in a consistent routine that drives the best results and focuses my time and energy on only the most important tasks. I want to be more proactive. How you give your team room to innovate and experiment: The managers hold the keys to their locations. We have standards to follow and certain ways things need to be completed, but everything else is up for debate. If they have an idea and a plan that will improve our operations or quality of life for our team, they can try it out. Those ideas can be generated from any position. Innovation isn’t just for me to think about. It’s a team effort. How close are you to operations? Extremely close right now. Only overseeing three locations allows me that privilege. Over time, that will evolve and change. What are the two most important things you rely on from your franchisor? Technology, innovation, and a strong brand to stand behind. Technology always needs to be advanced—from how we obtain orders to making it easier to make those orders. The franchisor also needs to have a great product and values that align with my own. Currently, Toppers hits those needs. What you need from vendors: Great products that get delivered on time. Have you changed your marketing strategy in response to the economy? How? With the current economic challenges, we are focused on value. People are still eating out— maybe not as much, but they still are. We need to make great products that people choose over what someone else is offering. How is social media affecting your business? It’s a fast-moving platform. It’s an exciting and fun way to get new creative ads out in front of people. It also offers a lot of flexibility and options for how you want to invest your marketing dollars. That’s not to mention how fast you can create content and get it posted and served up to your customers. How do you hire and fire? We use classic interviewing techniques but also try to see if we are a good fit for them. We only want people to work for us who want to work for us. After a team member’s first 30 days, we will usually check in with them. If we don’t think they are the right fit or if they just don’t like being with us, we can separate on good terms. How do you train and retain? Toppers provides awesome tools and an online training platform to promote great training. These tools

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Karl Malchow Growth meter: How do you measure your growth? Are we still planning to open more locations? If we are and we continue to work the plan, then I consider us growing. Vision meter: Where do you want to be in five years? 10 years? In the next five, I would like to see us surpassing 10 locations. In 10 years, it’s a little hazier. The top-end potential with Toppers Pizza right now seems limitless due to all the available prime territory. I expect that to change based on the brand’s growth trajectory, but we intend to capitalize on it while it’s available. Do you have brands in different segments? Why/why not? Not currently, but the future could change that. How is the economy in your region(s) affecting you, your employees, your customers? It’s the same challenge as everyone else. Getting staffed in locations and continuing to grow top-line sales are always at the forefront of our planning. Are you experiencing economic growth in your market? Absolutely. Over the last four to five years, we’ve had major growth occur every year. This past year has pressured all restaurants, and even those that are well run in our communities have faced some headwinds when it comes to growing sales. Luckily, we’ve continued to grow our top line, and 2023 closed as another record sales year for our company. also help keep people developing and learning more. This naturally leads to better retention because the job doesn’t get stale. We also spend a lot of time trying to develop true leadership skills that apply to whatever career someone may be looking for. How do you deal with problem employees? If someone is a problem, they most likely don’t belong on the team. It doesn’t have to be a bad thing. It just didn’t work out. I think a lot of employers and employees forget it is a trade. If either party is unhappy with the expectations of the trade, it’s best to separate and move on. Fastest way into your doghouse: Living below the line. There will always be challenges and things stacked against us at times. Don’t get trapped being a victim. Find the solution even if you didn’t put yourself in the specific situation. No one else will get you out of it.

How do changes in the economy affect the way you do business? It’s an opportunity to double down on how you take care of your customers. Like I said before, people are still eating out. Make them want to buy your products over someone else’s. Provide exceptional service. Eliminate any pinch points your customers may have with placing orders or getting issues resolved. The better their experience, the more likely they are to return. Retained customers are easier to generate sales from than trying to find new customers. It goes the same with your internal teams. Take care of the team members that take care of your customers. Turnover is very expensive and makes it more challenging to provide that exceptional service.

Annual revenue: $5.8 million.

How do you forecast your business? We do yearly budgets for each location and monthly projection meetings to estimate sales, trends, and costs, and we keep weekly cash flow spreadsheets to compare actual results with projected ones.

2024 goals: Open a location in Manhattan, Kansas, and surpass $6 million in revenue.

What are the best sources for capital expansion? The best source is reinvesting into

BOTTOM LINE

40 | Multi-Unit Franchisee | Issue 1, 2024

the business. My partners and I are very disciplined with what we take out of the business. Profits are rolled back in to continue expanding. Those profits may drive the expansion on their own or secure other financing for us. Experience with private equity, local banks, national banks, other institutions? Why/why not? We have worked with various banks and some self-financed opportunities that have helped us grow over the past five years but nothing groundbreaking. What are you doing to take care of your employees? Continually doing wage audits throughout the year to make sure we are competitive and offering a fair wage. We also offer very flexible schedules, opportunities to learn and grow, management skills, and even life skills. We work with a lot of young adults who generally appreciate it when someone invests time to try and help them figure out how to transition from young adult to young professional. How are you handling rising employee costs (payroll, minimum wage, healthcare, etc.)? Really finding ways to become more efficient. To raise wages and provide those additional benefits, we need to be able to accomplish more work with fewer people and without requiring more effort on the team members’ part. What laws and regulations are affecting your business, and how are you dealing with them? There is not anything currently pressing. Some things are under debate but not entirely ironed out yet. So, I try not to get too worked up about things that haven’t come to fruition. How do you reward/recognize top-performing employees? We do profit sharing with managers, bonus opportunities, gifts, and accolades. Sometimes, the highest performers will be sent to training opportunities around the country to help open new locations for other franchisees. What kind of exit strategy do you have in place? Currently, there is not one. We are focused entirely on growing with the brand right now. 

Pathik Patel

“Make sure the team knows it is okay to make mistakes and that they don’t have to stop there. Keep going to come to a solution.”

“Of Course, I Can”

Building culture and boosting buy-in at 3 brands Written by HELEN BOND

North Carolina-based VAAP Management is a family-owned business launched by Patel, his brother Viral, and cousins Amit and Alpesh Patel. Now seasoned owners of 16 Dunkin’ locations, they expanded into multi-brand operations with Buffalo Wild Wings GO, a concept focused on takeout and delivery. In 2023, the company made a multi-unit deal to develop five locations of Curry Up Now, the nation’s fastest-growing Indian fast-casual concept. Patel’s first job in high school was working for his father at a co-branded Dunkin’ and Baskin-Robbins restaurant. He never dreamed he would own franchises of the QSR brand. Instead, he grew up wanting to be an architect. “Not the slightest thought,” Patel says. “I thought I would design a high-rise building one day, but I was way off.”

PATHIK PATEL

President

Company: VAAP Management No. of units: 16 Dunkin’; 1 Buffalo Wild Wings GO; 1 Curry Up Now Age: 36 Family: Wife; 1 son, 3; 1 newborn daughter Years in franchising: 7 Years in current position: 7 42 | Multi-Unit Franchisee | Issue 1, 2024

athik Patel took more than five years to find the right fit with Dunkin’, launching his journey into franchise ownership with a three-unit operation in Charlottesville, Virginia. This type of tenacity is fitting for Patel, president of VAAP Management. It reflects the culture he is building as a multi-brand operator with a portfolio that has taken off. “We have a culture-building statement in our company that our director of ops came up with, ‘Of Course, I Can,’” explains Patel. “This is basically for everyone in our company to find a way to say ‘Yes’ to a guest. There are many processes and procedures that have been modified or created by our team. All of them started by simply listening to their ideas and giving resources to make those ideas a reality.”

Every step of his path seemed designed to bring him back to Dunkin’. As a kid, Patel did his homework in the lobby of the New Jersey Dunkin’ where his parents worked after his family immigrated to the U.S. in 1996. While pursuing his architecture degree at the New Jersey Institute of Technology, Patel first experienced the ins and outs of multiunit franchising while working in the head office of his father’s partner, who operated 30 Dunkin’ restaurants. Patel continued to follow his childhood dream, working at a small architecture firm that mainly designed Dunkin’ stores. The job offered insight and interaction with franchisees, so he could learn more about the development side of the business. Seeking something more significant and meaningful, “I went back to what I knew,” says Patel, who then began his quest to buy or develop with Dunkin’. He had already teamed up with his brother and cousins in college to launch VAAP online, a supplement business. The venture didn’t pan out, but the partnership showed promise. “It was at that point in time that I had a feeling the four of us could have a successful business together in the future,” Patel says.

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*This is historical representation of what some of our franchised stores earned as described further in Item 19 of the FDD. This information is based upon 66 of 264 Drive-Thru Kiosks that were open during the entire 2022 calendar year and provided complete information. Your results may differ. There is no guarantee you will stay in business that long or that you will achieve the stated levels of same-store sales growth within that time period. See Item 19 of the FDD for more information. **This is historical representation of what some of our franchisees have earned as described further in Item 19 of the FDD. This information is based upon 185 of 421 Drive-Thru Kiosks that were open during the entire 2022 calendar year and provided complete information. Your results may differ. There is no assurance that you will sell or earn as much. See Item 19 of the FDD for more information.

Pathik Patel Now firmly entrenched in franchising, Patel is busy constructing a long-term vision brimming with growth. VAAP continues beefing up its leadership team and projects to add another four brands to the fold over the next decade. “What we have is going to stay with us for a long time,” Patel says.

PERSONAL

First job: During high school, I worked for my dad at Dunkin’ and Baskin-Robbins. Formative influences/events: Previous business partnerships and co-workers. Key accomplishments: Starting a cricket team. The whole founding principle of building great leaders, my mission, vision, and purpose comes from my experience with cricket. Biggest current challenge: Work-life balance. Next big goal: Become a leader in multibrand management and learn to dance. I love Punjabi. It’s basically high-beat music. First turning point in your career: Leaving architecture and starting a business. Best business decision: Getting into business. Hardest lesson learned: I can’t do it alone. Work week: Around the clock. Exercise/workout: When time permits. Best advice you ever got: Trust is where it all starts. What’s your passion in business? Helping people become leaders. How do you balance life and work? It’s an ongoing process, but my family is my top priority. Guilty pleasure: Eating a cheesecake. Favorite book: Books in general are my favorite, but I will never get tired of reading I Am Krishna by Deep Trivedi. Favorite movie: “Saving Private Ryan.” What do most people not know about you? I can’t spell without imagining typing the word. Pet peeve: People who are not humble. What did you want to be when you grew up? An architect. Last vacation: The Bahamas. Person you’d most like to have lunch with: From the past: King Leonidas, the legendary king of Sparta. From the present: MS Dhoni, renowned professional Indian cricketer. 44 | Multi-Unit Franchisee | Issue 1, 2024

MANAGEMENT

Business philosophy: Becomes easier with two or more. Anything can be achieved when you have a team. Management method or style: Visionary. Greatest challenge: Effective communication with evolving work culture. How do others describe you? Determined. A visionary. Always shows up. Never stops. One thing you’re looking to do better: Continue to build a better culture. How you give your team room to innovate and experiment: Make sure the team knows it is okay to make mistakes and that they don’t have to stop there. Keep going to come to a solution. We can assess the “wells and betters” afterward, so we don’t repeat the same mistakes. How close are you to operations? I keep a bird’s-eye view over everything and read all communication but do not intervene. Make a note of all and discuss it on our weekly calls. What are the two most important things you rely on from your franchisor? Market data to see how our competitors are doing and what is trending in products and services. What you need from vendors: Reliable and cost-effective products and a courteous relationship. Have you changed your marketing strategy in response to the economy? How? Yes, it is always changing. During Covid, we focused mainly on standardizing operations and very little on marketing. Now, it is shifting toward marketing and finding ways to bring in more guests. How is social media affecting your business? It is laying the foundation for the future of our business. It helped us acquire new, younger guests, who become loyal to the brand. How do you hire and fire? A big part of our operation is digital, including onboarding. This helps us convey our message clearly through one channel. Our voluntary or involuntary termination is based on a statement of understanding. A statement is given to a team member stating their actions and the consequences of those actions. This helps them to reflect upon it and determine if they wish to improve or move on. How do you train and retain? We have a new hire training schedule that store leaders must implement with new hires. With our growth, we’ve created a position in the com-

pany, the support and development leader, who oversees all of the training progress and provides group training sessions from time to time. This position is a direct line for our store leaders on the local level to call for any purpose. It could be finding an item number, coordinating their in-store training, picking up an item from another store, or simply calling to say hello. When the store leader is tied up and someone can’t get what they need, they can also call our support and development leader. Our mission, vision, and purpose drive our team. Our mission: Inspire an “Of Course, I Can” culture and empower teams to deliver a best-in-class experience to every guest. Our vision: Support and reward the “Of Course, I Can” leaders with unlimited development and growth opportunities. Our purpose: Help bring the great leader out from within! How do you deal with problem employees? Have open communication as an option at any given time. This lets team members know they can be heard at any time. Most often, the cause of difficult situations is due to a lack of communication. We post a contact list at each location stating whom to call first, second, third, etc. The best practice during conversations with difficult team members is listening. Just listen to them completely and understand their point of view first. In response, restate the importance of our “Of Course, I Can” values. Fastest way into your doghouse: Being dramatic.

BOTTOM LINE

Annual revenue: $18 million. 2024 goals: $24 million. Growth meter: How do you measure your growth? We measure growth by the number of team members on our Above Restaurant Leader (ARL) team. In 2021, we had three team members on our ARL team. Today, we have 10. Vision meter: Where do you want to be in five years? 10 years? In five years: 25 on our ARL team, five different brands, and a total of 50 units. In 10 years: 70 on our ARL team, seven different brands, 150 units. Do you have brands in different segments? Why/why not? No. All our brands are in the food segment. How is the economy in your region(s) affecting you, your employees, your customers? For the most part, the economy has affected our labor. Finding talent has been a challenge and still continues.

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Pathik Patel

“We have a culture-building statement in our company that our director of ops came up with, ‘Of Course, I Can.’ This is basically for everyone in our company to find a way to say ‘Yes’ to a guest. There are many processes and procedures that have been modified or created by our team. All of which started by simply listening to their ideas and giving resources to make those ideas a reality.”

Are you experiencing economic growth in your market? Yes, housing prices have doubled in the past few years, big tech giants are opening their East Coast hubs, construction is happening on every road, the cost of doing business has increased tremendously in a short period, and there is a wait at every restaurant you go to for dinner. How do changes in the economy affect the way you do business? We generally focus on the top-line growth. The conversations go well with the team when we talk about improving service and upselling versus telling them to be conservative on their food order or scheduling. Bottom-line savings is something businesses tend to focus more on, but if we keep our top numbers growing, most of the time, it takes care of many of the bottom-line expenses. Reducing waste means ordering to the “T,” and this means we can run out of produce early in the day, which can reduce sales potential. During Covid, the top lines were great, and we didn’t need to put much thought into the bottom lines. But post-Covid, we have to look at increasing sales through marketing just as much as keeping waste down and increasing labor productivity. And most importantly, keeping our team motivated. It is like juggling three bowling pins. How do you forecast for your business? A positive transaction count is a giveaway for business growth, and it’s easy to plan in that phase. But when we are trending down in transactions, which probably everyone is experiencing these days, it gets tough. Transaction 46 | Multi-Unit Franchisee | Issue 1, 2024

trends are what help us forecast our business along with product mix.

about the importance of our mission, vision, and purpose.

What are the best sources for capital expansion? A combination of cash flow and an effective management team. Cash is king, but the people are priceless. When your business is generating good cash flow, almost every lender wants to work with you, but they want to know about the key people in the organization who are making this possible. Bad cash flow operations can be turned around with great people, but great cash flow can be reduced drastically without the right people in place.

How are you handling rising employee costs (payroll, minimum wage, healthcare, etc.)? Raising prices while staying competitive is the short-term answer. But for the long-term solution, our best response has been shifting our team’s perception of labor cost. Their bonus calculation is not the percentage of the sales but rather labor productivity (i.e., how many hours it takes to take care of all the transactions, regardless of the sales). This takes the monetary thinking out of the equation and puts the focus on the math equation.

Experience with private equity, local banks, national banks, other institutions? Why/why not? We generally like to stick with conventional lending. Do not like private money as some of them tend to get involved in the operation. We feel this would affect the culture that we have built. What are you doing to take care of your employees? Listening to their needs. Many want to learn and progress in their careers. We sign them up for webinars, buy books, coach them, set up training on how to use computers, etc. We build 30-, 60-, 90-, and 180-day development plans for setting expectations, achieving goals, pay raises, etc. We conduct group meetings for new product launches and train to build culture while having everyone share their “Of Course, I Can” stories. We have a monthly competition where the winner keeps a traveling trophy at their location for the month. We constantly remind our employees

What laws and regulations are affecting your business, and how are you dealing with them? Lately, there are not as many regulations on business operations as there were during Covid. North Carolina does not have any minimum wage increase either, but we do have a pay raise trend across the nation that we stay with. How do you reward/recognize top-performing employees? Acknowledgment at monthly meetings, bonuses, recognition with a trophy, announcements across the network, and promotions. What kind of exit strategy do you have in place? Operating an existing franchise operation is far easier than running a private business. With that being said, making our restaurant team the best it can be so they perform well under any leadership will make our company even more efficient. 

Tom Pentenburg

“This is our work family. I know some companies give that lip service, but it really is the way we operate and do business.”

“One-Brand Guy”

Owner found his fit with Spherion Staffing Services Written by HELEN BOND

degree and dove headfirst into the service industry. He spent five years with Olive Garden, opening new restaurants across the U.S., before transitioning into an operations management role in manufacturing where he was schooled on the client side of the staffing business. With a growing family and a quest to find his career fit, Pentenburg began looking for a new challenge. He signed on with a Chicagobased staffing company as general manager to launch a new agency in Fort Wayne, Indiana. He spent more than a decade fine-tuning his staffing, recruiting, and leadership experience before venturing into franchising. In 2009, he partnered with his wife, Elizabeth, to open their first Spherion location. Pentenburg’s journey to find his professional calling led him down a path that has helped thousands of others further their own careers. Along the way, he built a family enterprise. Four children are actively involved in the company and report to the COO in charge of day-to-day operation. Pentenburg also thinks of key executives as part of the family as he develops the next generation of leaders.

TOM PENTENBURG

Owner

No. of units: 21 Spherion Staffing Services Age: 59 Family: Wife Elizabeth; 4 adult children, Anna, Molly, Marty, and Jack; 3 grandchildren with 1 on the way Years in franchising: 15 Years in current position: 15 48 | Multi-Unit Franchisee | Issue 1, 2024

om Pentenburg has a knack for putting the right people in the right place to drive his business and boost career success for others. As Spherion Staffing Services’ largest multi-unit franchisee, Pentenburg oversees a network of 21 offices in Indiana, Kentucky, and Ohio. “We’re really good at putting together teams of people and scaling,” Pentenburg says. “The key to our success is having the right people in each locale because I’m not in front of everybody every day. You’ve got to build a culture of people that you can trust and that share your vision.” Pentenburg grew up in Lima, Ohio, and is a proud alumnus of The Ohio State University. He graduated with a hospitality management

“We have a chat session with our internal team that we call the ‘whole family,’” he says. “This is our work family. I know some companies give that lip service, but it really is the way we operate and do business. I had a great experience growing up in a family environment, so no matter how big we get, I have the kind of relationship with all of the team where they know that we’re going to do our best to make sure they get out of this business what they want to get out of it. It’s a small family business that has gotten bigger. We treat people right, and it has served us well.”

PERSONAL

First job: Like many, my first jobs were mowing lawns, raking leaves, and shoveling snow. My first real job was scooping ice cream at an ice cream parlor. Formative influences/events: I would say having good role models like my dad and grandfather. We grew up in a very nurturing and faith-filled home. Our faith centered the

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Tom Pentenburg

“The key to our success is having the right people in each locale because I’m not in front of everybody every day. You’ve got to build a culture of people that you can trust and that share your vision.” world around us. Our parents were always great examples of excellent work ethic and the desire to do our best at whatever life had in store for us. Key accomplishments: Building a strong marriage for 31-plus years and raising four children to be successful humans! Biggest current challenge: Managing growth and changing economic conditions. Knowing when to hire and when to invest. It is a daily challenge to rally a team to respond appropriately to the business climate. Next big goal: I want to develop our company’s next era of leaders. Our business has an excellent foundation for our leadership team to grow and flourish well into the future. We are a closely-held company with all our adult children involved and engaged along with some excellent top-level leaders. It is my goal to make sure that they all thrive from a career standpoint. The first turning point in your career: After we opened the doors of our first unit, securing that first big order for a staffing need. What a thrill it was to see the business grow. Such a sense of accomplishment. Best business decision: Investing in Spherion was a great decision. It allowed me to take a franchise business model and scale it. The franchise models, if done correctly, should be repeatable. Spherion is just that and has enabled my franchise organization to add new units in new cities regularly. 50 | Multi-Unit Franchisee | Issue 1, 2024

Hardest lesson learned: Always be prepared for a rainy day in business because rainy days will come. Don’t get too high when things are good, and don’t get too low when things are down. Work week: I work a pretty traditional Monday through Friday except in the summer months. I try to slip some Friday “lake days” into my work routine. Exercise/workout: Chasing my grandsons. Best advice you ever got: When you are in a business that provides a service, you don’t have to be the smartest person in the room, but never let anyone in that room out-work, out-hustle, or out-service you. What’s your passion in business? For me, it’s building the teams that make up our company and seeing people grow in their careers. That is so fulfilling. Guilty pleasure: Anything involving The Ohio State University football and basketball. Favorite movie: “The Dirty Dozen.” What did you want to be when you grew up? I grew up around, and worked for, some great business owners, and it always was a dream of mine to own my own business someday. I tell my own grown children and company leaders, “Manage and lead it like you own it, and someday, you just might.” Last vacation: Traverse City and Petoskey, Michigan, in the fall.

Person you’d most like to have lunch with: That’s easy. If I could turn back time, I would love to have lunch again with my dad, the older Tom Pentenburg. I would love to show him our company that he never got to see and seek his wisdom going forward.

MANAGEMENT

Business philosophy: People buy from those they trust, like, and respect. When you achieve all of these hard-to-acquire traits, you can create the magic of long and sustainable business relationships. Management method or style: Hire great humans who are way smarter than me, teach them our business, create an accountability model for them, and then get out of their way. Have you ever been in a mentor-mentee relationship? What did you learn? Yes, I think since my earliest days of work, I sought out those I could learn from and who were willing to share their knowledge with me. So, I have had many mentors in my life. I think the key is understanding that you really can learn from everyone you encounter in your work life. One thing you’re looking to do better: At this stage of my career, I get so much joy out of helping others succeed. I want to continue to find opportunities to help others achieve career success and to give back to those who have helped me along my career journey. How close are you to operations? I am always an arm’s length away from where the action is happening—close enough to be a

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Tom Pentenburg ployees. The pressure of inflationary times has certainly made it more challenging. Are you experiencing economic growth in your market? It is a mixed bag right now. Some areas are seeing growth, and some are seeing economic decline. How do changes in the economy affect the way you do business? We have learned to pivot and make fast decisions or course corrections to react appropriately to changing economic conditions. In many ways, I think it has made us as a team nimbler and more aware of the changing business needs of our clients. What are the best sources for capital expansion? Strong relationships with local banking partners in each local geography we serve.

resource but far enough away to give my leadership team the autonomy to operate and make decisions.

BOTTOM LINE

What are the two most important things you rely on from your franchisor? A great franchisor provides you with the definitions of the playing field in which you operate, such as business parameters and capabilities, and the support to help out when questions or problems arise.

2024 goals: To be known as the staffing and recruiting partner of choice for every market that we serve. To grow the number of lives we positively impact through employment. To create more opportunities for the professional growth and development of our internal team.

What you need from vendors: Their product needs to meet all deliverables on time and on budget. Have you changed your marketing strategy in response to the economy? How? The best example of this is the shift that has occurred since coming out of the pandemic. We used to have to market for candidates to work the jobs we had available; now we are marketing mainly for client companies to use the candidates we have in our database. How is social media affecting your business? Today, most of our candidate-attraction efforts happen using social media—almost exclusively, really. For the staffing industry, the days of thousands of outgoing phone calls weekly to attract candidates have given way to inbound calls and texts from interested people finding us through social media mentions. Fastest way into your doghouse: Poor communication. Our business is so detail oriented that we must have great oral and written communication. 52 | Multi-Unit Franchisee | Issue 1, 2024

Annual revenue: More than $40 million for 2023.

Growth meter: How do you measure your growth? The best measure for us is bottom-line growth. Revenue is great, but it really comes down to understanding how to manage the business to achieve profitable growth regardless of the revenue. As a business owner, you have to know your numbers. Vision meter: Where do you want to be in five years? 10 years? In the next five years, I will be focusing on the leadership development of our team. At this stage of my career, it is about making sure we build a legacy that will last long after me. Do you have brands in different segments? Why/why not? I am a one-brand guy, so I can focus my efforts on the industry I know best. How is the economy in your region(s) affecting you, your employees, your customers? This past year has been the most challenging year that we have been in business. Current U.S. economic conditions have impacted our industry greatly. Everyone is impacted, including our clients and our em-

What are you doing to take care of your employees? We are constantly evaluating compensation and benefit plans to match the needs of today’s employees. It is not a one-sizefits-all solution today. How are you handling rising employee costs (payroll, minimum wage, healthcare, etc.)? It is an increasing burden for sure. This requires our company leaders to get creative with how we utilize our team and get maximum value out of our benefit partners. What laws and regulations are affecting your business, and how are you dealing with them? It has become increasingly important for our customers to know that we comply with all laws regarding employment in the areas we serve. That means we must be excellent at executing compliance. How do you reward/recognize top-performing employees? Rewards for some come in the form of compensation increases, but we also offer opportunities for some team members to go on recognition trips based on their individual performances. What kind of exit strategy do you have in place? This is a work in progress. We have a strong leadership team, and with family involved, that is helping me look to the future. Soon, the students will become the teachers, and when that day comes, I can plan a smooth transition and exit. 

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Joe Piro

“Whatever your job is, just be the best at it. Be better than everybody else, and you will get ahead.”

Swapping Burgers for Salads

Joe Piro is Salata Salad Kitchen’s largest franchisee Written by HELEN BOND

Texas, and Lake Charles, Louisiana, with six more locations planned for his hometown Houston area. Piro also partnered with his daughter to invest in Face Foundrié, a rapidly emerging express facial bar concept. A self-described “ops guy” with 36 years of franchise experience, Piro learned the value of a strong work ethic early. At 17, he was a freshfaced high school graduate and drummer in a band trying to figure out his life path when he took a summer job at Burger King. Piro never looked back, swiftly moving up from an hourly employee into management and up the operations ladder to eventually become the operating partner of his own Burger King stores in the Houston market. “If we could teach people how to work hard in life, they will get ahead,” Piro says. “Whatever your job is, just be the best at it. Be better than everybody else, and you will get ahead.” Piro pours the same type of commitment into his family’s passion project to build a better life for children in a small, impoverished village in Honduras, his wife’s home country. The project started as a labor of love by his wife and mother-in-law to collect clothes, school supplies, and backpacks.

JOE PIRO

President/Franchisee Company: Supreme Greens Franchise Group No. of units: 21 Salata Salad Kitchen, 3 Face Foundrié Age: 65 Family: Wife; 2 kids; 1 grandchild Years in franchising: 36 54 | Multi-Unit Franchisee | Issue 1, 2024

eteran multi-unit franchisee Joe Piro says he was a Burger King operator on the hunt for an innovative opportunity to develop and grow when he “fell in love with Salata.” “I was looking for something fresh and new that wasn’t going to be a fad and was going to be sustainable,” says Piro, a Salata Salad Kitchen franchisee since 2012. “Eating healthy is something that is going to be around forever.” Piro eventually swapped out burgers for salads, selling his fast-food restaurants to focus on expanding with Salata. These days, Piro stands as the largest franchisee of the fastcasual chain, operating 15 made-to-order salad kitchens across Houston and College Station,

“One night, I woke up in the middle of the night thinking, ‘Why don’t we just build a facility?’” Piro says. What followed was the construction of an enclosed community kitchen with a covered area for seating. Funds are sent monthly to cover the cost of food cooked to serve 75 to 100 kids twice a week. Plans include a park and playground equipment so kids can eat, play, and just be kids. More expansion is also on the way for Piro’s burgeoning portfolio. With no exit plan in sight, Piro remains focused on achieving his current goal of filling out the Houston market with his two brands. “As long as sales remain strong, and I can continue to build, I don’t see the point in stopping,” he says. “When you love what you do, it’s not really work. It’s just what you do.”

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• $1.28MM AUV** • Over 535 stores in 21 states • Ranked #9 in U.S. pizza sales* • Strong sales to investment ratio • 1,500 sq. ft. carryout/delivery concept INTERESTED IN LEARNING MORE?

Scan the QR code for more information. Steve Clough Director of Franchise Development (248) 414-3300, ext. 242 franchising.hungryhowies.com • sclough@hungryhowies.com

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*Source: 2022 Technomic **Based on Gross Sales of the top performing 25% (or 71 units) of Hungry Howie’s Franchised Units that were open for the entire 52-week period from December 27, 2021 through December 25, 2022. Franchised Units* means all Hungry Howie’s Units that were open and reporting sales to us for the entire fiscal year, and excludes units in the State of Florida, affiliated units, units which opened or closed during the entire fiscal year, legacy units which are not obligated to and do not report sales to us, and units that were closed for more than ten consecutive days during the entire fiscal wear due to a force majeure event (e.g. COVID- 19). The Franchised Units are in 20 states. These Franchised Units have reasonably similar operations as those being offered for sale. See Item 19 of Hungry Howie’s 2023 Franchise Disclosure Document for additional information. This information is not intended as an offer to sell, or the solicitation of an offer to buy, a franchise. It is for informational purposes only. Currently. the following states regulate the offer and sale of franchises: California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota Oregon, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin. If you are a resident of one of these states, we will not offer you a franchise unless and until we have complied with applicable pre-sale registration and disclosure requirements in your jurisdiction. All stores are independently owned and operated. ©2023 Hungry Howie’s Pizza & Subs, Inc. All rights reserved. Hungry Howie’s® and its related marks are trademarks of Hungry Howie’s Pizza & Subs, Inc. Use of the trademarks in the State of Florida are under license to HH Pizza, Inc. Hungry Howie’s locations are franchised to independent owners and operators by Hungry Howie’s Pizza & Subs, Inc. located at 30300 Stephenson Highway Suite 200, Madison Heights, Michigan 48071 (248) 414-3300. Stores located in the State of Florida are franchised by HH Pizza, Inc. located at 2109 -D Main Street, Dunedin, Florida. 34698 (727) 734-8800. STATE OF CALIFORNIA: THESE FRANCHISES HAVE BEEN REGISTERED UNDER THE FRANCHISE INVESTMENT LAW OF THE STATE OF CALIFORNIA SUCH REGISTRATION DOES NOT CONSTITUTE APPROVAL, RECOMMENDATION, OR ENDORSEMENT BY THE COMMISSIONER OF CORPORATIONS NOR A FINDING BY THE COMMISSIONER THAT THE INFORMATION PROVIDED HEREIN IS TRUE, COMPLETE, AND NOT MISLEADING. Hungry Howie’s Pizza & Subs, Inc., 30300 Stephenson Highway, Suite 200, Madison Heights, MI 48071, 248-414-3300.

Joe Piro

“As long as sales remain strong, and I can continue to build, I don’t see the point in stopping. When you love what you do, it’s not really work. It’s just what you do.”

PERSONAL

First job: Hourly employee at Burger King at age 17. Formative influences/events: Roger Swift, the Burger King franchisee I worked for, was inspirational to me. His work ethic was amazing. At that time, I remember saying that I wanted to be that guy one day. Key accomplishments: The American Dream! I worked my way up from a summer job out of high school as a Burger King hourly employee to multi-unit management and eventually a partner before selling out and becoming a Burger King franchisee on my own. Becoming the largest Salata franchisee. Most of all, building a free-standing kitchen where we cook, feed, and clothe poor children in Honduras. Biggest current challenge: Finding dedicated employees and management after Covid-19. Next big goal: To fill out the Houston market with both Salata and Face Foundrié. To turn our kitchen in Honduras into a park where the kids can not only eat, but have fun as well. First turning point in your career: Selling out of my partnership and becoming a Burger King franchisee on my own. That was a big step. There were no more partners and no one to make it a success but me. 56 | Multi-Unit Franchisee | Issue 1, 2024

Best business decision: To join Salata as a franchisee. Hardest lesson learned: Not to make decisions based on emotions.

Last vacation: Belize. I have a home there, and I am building some condos with a development group, so I try to go often.

Work week: These days about 45 hours.

Person you’d most like to have lunch with: Paul McCartney.

Exercise/workout: Three times a week.

MANAGEMENT

Best advice you ever got: I found the best advice in a quote: “If it is to be, it’s up to me.” What’s your passion in business? I love that my business allows me to help people in many ways. Giving back is very important to me. Teach people to be the best at whatever we do at all levels. If you are a dishwasher, be the best dishwasher you can be. It doesn’t matter what your job is. Be the best at it. You don’t need a college degree to work harder than the next person. How do you balance life and work? Making time for family is the most important part of that balance. I try to include my wife and kids in almost everything that I do. Guilty pleasure: I love my red wine. Favorite book: I don’t have the patience to sit and read much. Favorite movie: “Top Gun.” What do most people not know about you? I grew up surfing and playing the drums in San Diego. What did you want to be when you grew up? As a kid, I wanted to be a dentist. I guess that counts as my first failure.

Business philosophy: If you’re not moving forward, you’re moving backward. I keep a framed poster in my conference room that is a quote by Martin Luther King Jr.: “If you can’t fly then run, if you can’t run then walk, if you can’t walk then crawl, but whatever you do, you have to keep moving forward.” Management method or style: The old “KISS” method: Keep it simple, stupid. Greatest challenge: Finding people with the same level of dedication as I had when I started. The opportunities are endless. People just need to realize that. How do others describe you? Demanding and firm but fair and easy to get along with if you’re doing your job. Have you ever been in a mentor-mentee relationship? What did you learn? Yes. When I was a manager, I took many others under my wing and taught them all that I could. To this day, I have people I managed many years ago who stay in touch with me and have shown gratitude for what they learned from me. Most people will excel when you take the time to invest in them.

Joe Piro

“Training is the easy part. Retention is an age-old problem in our industry. Promoting from within has been the most effective way for us to keep our employees happy and give them plenty of opportunities to move up within our organization.”

How you give your team room to innovate and experiment: If you want your team to grow, you must give them room to innovate and experiment. Sometimes, it’s painful to watch, but it’s necessary for their development. How close are you to operations? I am an ops guy. I grew up in restaurant operations. It’s in my blood and hard to let it go, but to grow the business, I have had to turn it over to my director of operations, Iris Campos. I still stay involved in operations but on a much broader scale. What are the two most important things you rely on from your franchisor? An unimpeded supply chain of safe and quality products and every program they put forward needs to be thought through and take customer service and satisfaction into account. What you need from vendors: Vendors play such an important role in our food safety and quality. They don’t often get the credit they deserve. Have you changed your marketing strategy in response to the economy? How? Since Covid, we have expanded our delivery methods and increased our off-premise business. How is social media affecting your business? Social media is a great way to reach many people. Personally, I love the homegrown posts that are created by our fan base. How do you hire and fire? I leave that up to my director of operations. I have found over the years that if I am the one who hires and they don’t work out, then they like to blame 58 | Multi-Unit Franchisee | Issue 1, 2024

me. They should take ownership of their own decisions in hiring people.

tion, other than to include more time on the beach in Belize.

How do you train and retain? Training is the easy part. Retention is an age-old problem in our industry. Promoting from within has been the most effective way for us to keep our employees happy and give them plenty of opportunities to move up within our organization.

Do you have brands in different segments? Why/why not? Salata in the fastcasual segment and Face Foundrié in the salon/ spa segment.

How do you deal with problem employees? They are challenges but can be opportunities as well. Many problem employees can be turned around if their managers communicate the problems with them. I don’t believe that many employees come to work wanting to be a problem. Fastest way into your doghouse: I have no patience for laziness. The restaurant business is high intensity. It is not a place for laziness.

BOTTOM LINE

Annual revenue: Projected 2024 revenue should top $30 million. 2024 goals: I have three new Salata locations on the books to open in early 2024 along with two Face Foundrié locations. Growth meter: How do you measure your growth? I measure growth in year-overyear same-store sales. Vision meter: Where do you want to be in five years? 10 years? If you had asked me this question five or 10 years ago, I would not have expected to be anywhere close to where I am today. So, I think I will pass on this ques-

How is the economy in your region(s) affecting you, your employees, your customers? Inflation is definitely having an impact on our customers. They are starting to spend less, and that includes eating out. People are trying to stretch their dollars as much as possible. What are the best sources for capital expansion? I found that local and regional banks are good sources of capital. Having a good personal relationship with your banker is an important factor in obtaining capital for expansion. How are you handling rising employee costs (payroll, minimum wage, healthcare, etc.)? This is a serious problem in our industry. As all of our costs continue to increase, we end up absorbing much of that. We simply cannot continue to raise our prices to compensate for all the increases in our costs. What kind of exit strategy do you have in place? I don’t have an exit strategy at this point. As long as sales remain strong, and I can continue to build, I don’t see the point in stopping. When you love what you do, it’s not really work. It’s just what you do. 

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2024 MEGA 99

RISING TRENDS IN MULTI-UNIT FRANCHISING Written by CHRISTINA NIU

With more than 420,000 franchised units owned by 234,000 franchisees in the system, multi-unit operators (MUOs) are shaping franchising’s future. Notably, MUOs in the U.S. control more than 50% of all franchised units, marking a substantial shift in the franchising paradigm. According to our latest data, the number of MUO franchisees with more than 50 units has surged by an impressive 112.3% since 2019 with certain sectors exhibiting even higher concentrations. MUOs hold a significant share in various sectors, dominating 82% of QSR units, 71.5% of beauty-related franchises, and 72% of sit-down restaurants across the U.S. In 2024, large multi-unit ownership and consolidation will continue to gain traction. One key driver of this trend is the positive perception of multi-unit franchise operators by the lending community. There have been significant changes in the eligibility and application process for Small Business Administration (SBA) loans. In addition, repayments and refinancing out of SBA loans negatively affect secondary market premiums, reducing the amount of capital an SBA department has to lend. These factors are pushing lenders to target high-quality borrowers. Interest rates may remain unchanged longer than anticipated because the Federal Reserve isn’t expected to make cuts until later this year. This further emphasizes the need for borrowers to be financially well equipped as business loans become less affordable.

Another prominent trend is mid-to-large-sized multi-unit owners acquiring brands outside of their typical industry. For example, seasoned QSR franchisees, known for their successes with brands like Papa Johns and Qdoba Mexican Grill, are targeting Phoenix, Arizona, with a multi-unit franchise agreement with GLO30, a skincare franchise concept. Our analysis of Dunkin’ franchisees shows that 14% own another franchise brand, and those brands range from oil change concepts to optometry and health clinics. In addition, multi-unit franchisees are actively exploring diverse strategies to fuel growth, and one approach gaining momentum involves considering alternative locations, like airports and travel centers. Nontraditional locations present opportunities for franchisees to adopt various business formats, catering to emerging trends and consumer preferences. It allows them to broaden customer outreach and operate with lower overhead costs, promoting efficiencies. Franchisees from well-known brands, such as Arby’s, Taco John’s, Wendy’s, Bojangles, McDonald’s, and others, are successfully expanding their footprints this way. The trends in multi-unit franchising reflect a dynamic industry responding to economic shifts, regulatory changes, and entrepreneurial ambitions. As the landscape evolves, adaptability and strategic decision-making will be pivotal for stakeholders navigating 2024. Christina Niu is director of research at FRANdata.

2024

MEGA 99 RANKINGS RANK

COMPANY

UNITS

BRANDS

FLYNN GROUP

2,709 Planet Fitness

SUN HOLDINGS

1,755

THE DHANANI GROUP

1,493 Robbins

KBP BRANDS

1,107 KFC, Taco Bell, Arby’s

CARROLS RESTAURANT GROUP

1,092 Burger King, Popeyes

TARGET

831

Pizza Hut

Pizza Hut, Applebee’s, Arby’s, Taco Bell, Wendy’s, Panera Bread, Arby’s, Popeyes, Burger King, Applebee’s, Papa Johns, GNC Live Well, McAlister’s Deli, IHOP, Golden Corral, T-Mobile, Taco Bueno, Rodeo Bar, Cantina Laredo, Papi’s Caribbean Grill Burger King, Popeyes, Pizza Hut, Dunkin’, La Madeleine, Baskin-

LOVE’S TRAVEL STOPS & COUNTRY STORES

717

Subway, Godfather’s Pizza, Chester’s, Arby’s, Hardee’s, Carl’s Jr., Taco John’s, Sleep Inn by Choice Hotels, Holiday Inn, Fairfield by Marriott, Dunkin’, Microtel Inn & Suites by Wyndham, DQ Treat, Naf Naf Middle Eastern Grill, Bojangles, Best Western Hotels & Resorts, MainStay Suites Extended Stay by Choice Hotels, Jet’s Pizza, Bimbo Foods Bakeries Distribution, Hampton Inn by Hilton

PILOT COMPANY

686

Subway, Cinnabon, Dunkin’, Wendy’s, Arby’s, Taco Bell, DQ Treat, Auntie Anne’s, Pizza Hut, Moe’s Southwest Grill, Comfort, Chester’s, Little Caesars, KFC, IHOP

HAZA GROUP

538

Wendy’s, Taco Bell

SIZZLING PLATTER

523

Little Caesars, Jamba, Wingstop, Dunkin’, Sizzler, Red Robin Gourmet Burgers

TEAM CAR CARE

509

Jiffy Lube

ARAMARK

503

Chick-fil-A, Einstein Bros. Bagels, Subway, Panda Express, Dunkin’, Oath Pizza, Which Wich, Moe’s Southwest Grill, Steak ’n Shake, Qdoba Mexican Eats, Jamba, Papa Johns, Freshii, Raising Cane’s, Taco Bell, Erbert & Gerbert’s Sandwich Shop, Panera Bread, Mooyah, Tim Hortons, Auntie Anne’s, Village Juice Co., PJ’s Coffee of New Orleans, Caribou Coffee, Quiznos, McAlister’s Deli, Chili’s, Paciugo Gelato & Caffe, BurgerFi, La Madeleine, Extreme Pita, Pizza Hut, Rusty Taco, Baja Fresh, Wendy’s, Denny’s, Smashburger, Jersey Mike’s Subs

GPS HOSPITALITY

501

Burger King, Pizza Hut, Popeyes, Days Inn by Wyndham Issue 1, 2024 | Multi-Unit Franchisee | 63

Mega 99 Rankings

RANK

COMPANY

UNITS

BRANDS

ARMY & AIR FORCE EXCHANGE SERVICES

481

Subway, Burger King, Charleys, Popeyes, Arby’s, Taco Bell, Qdoba Mexican Eats, Einstein Bros. Bagels, Baskin-Robbins, Dunkin’, Rice King, Wing Zone, Regal Nails Salon & Spa, Slim Chickens, Pizza Hut, Taco John’s

CMG COMPANIES

458

KFC, Sonic, Rent-A-Center, Taco Bell, Little Caesars, Ace Hardware

CHARTER FOODS

440

Taco Bell, Long John Silver’s, KFC, Pizza Hut, A&W

AMPLER GROUP

434

Burger King, Little Caesars, Church’s Texas Chicken, Taco Bell, Pizza Hut

SUMMIT RESTAURANT GROUP

409

IHOP, Applebee’s, Sonny’s BBQ

PACIFIC BELLS

395

Taco Bell, Buffalo Wild Wings, KFC

WKS RESTAURANT GROUP

381

Wendy’s, Denny’s, El Pollo Loco, Krispy Kreme Doughnuts, Blaze Pizza

HARMAN MANAGEMENT CORPORATION

379

KFC, A&W, Taco Bell, Long John Silver’s

AMPEX BRANDS

367

KFC, Pizza Hut, Long John Silver’s, Taco Bell, A&W

JIB MANAGEMENT (YADAV ENTERPRISES)

357

Jack in the Box, Denny’s, TGI Fridays, El Pollo Loco, Sizzler, Super 8 by Wyndham, Quality by Choice Hotels

TACALA

348

Taco Bell

ALLINE SALON GROUP

347

Supercuts, Cost Cutters Family Hair Salon

ROTTINGHAUS COMPANY

346

Subway

QUALITY RESTAURANT GROUP

342

Pizza Hut, Sonic, Moe’s Southwest Grill, Arby’s

TASTY RESTAURANT GROUP

338

Pizza Hut, KFC, Burger King, Taco Bell, Baskin-Robbins

MERITAGE HOSPITALITY GROUP

337

Wendy’s

FRASIER ENTERPRISES

336

Miracle-Ear

HEARTLAND RESTAURANT GROUP

331

Hardee’s, Dunkin’

K-MAC ENTERPRISES

327

Taco Bell, KFC

DIVERSIFIED RESTAURANT GROUP

315

Taco Bell, Arby’s

64 | Multi-Unit Franchisee | Issue 1, 2024

JOIN THE LARGEST FITNESS FRANCHISE IN THE WORLD. MOVE FAST, WE’LL COUNT IT AS CARDIO.

32%

avg. EBISTDA (corp locations)*

5,200+ locations on 7 continents

$700K+ AUV top quartile**

Fixed monthly royalty fees means more financial upside for owners

LEARN HOW TO IMPACT LIVES IN YOUR COMMUNITY.

Members get FREE access to Apple Fitness+ Create a life-changing business backed by 20+ years of category experience * This information was taken from the Anytime Fitness 2023 Franchise Disclosure Document. Number/Percentage At or Above Average Net Operating Income Before Manager Salary, Interest, Taxes, Depreciation and Amortization of the 12 company-owned studios for the year ended December 31, 2022. A new franchisee’s results may differ from these results. See 2023 Anytime Fitness Franchise Disclosure Document for additional information. **This information was taken from the Anytime Fitness 2023 Franchise Disclosure Document. 124 or 38% of the 325 franchised studios in the top one-quarter of the 1,301 studios in the survey actually attained or surpassed these results for the year ended December 31, 2022. A new franchisee’s results may differ from these results. See 2023 Anytime Fitness Franchise Disclosure Document for additional information. Anytime Fitness Franchisor, LLC: MN Franchise Reg. #10062. For New York residents: This advertisement is not an offering. An offering can only be made by a prospectus filed first with the Department of Law of the State of New York. Such filing does not constitute approval by the Department of Law. This document is not intended for the sale of a franchise. |© ANYTIME FITNESS FRANCHISOR, LLC | 111 WEIR DRIVE, WOODBURY, MN 55125

Mega 99 Rankings

RANK

COMPANY

UNITS

BRANDS

COMPASS GROUP USA

303

Chick-fil-A, Einstein Bros. Bagels, Papa Johns, Panda Express, Dunkin’, Subway, Pizza Hut, Moe’s Southwest Grill, Jamba, Steak ’n Shake, PJ’s Coffee of New Orleans, Jersey Mike’s Subs, Wendy’s, Caribou Coffee, Qdoba Mexican Eats, Tim Hortons, Which Wich, Chili’s, Slim Chickens, Freshii, Taco Bell, Bojangles, Sbarro, Pita Pit, Smashburger, Firehouse Subs, KFC, Freddy’s Frozen Custard & Steakburgers, illy Caffe, Auntie Anne’s, The Habit Burger Grill, Panera Bread, MOD Pizza, Burger King, Baja Fresh, Quiznos, Baskin-Robbins, Erbert & Gerbert’s Sandwich Shop, Blimpie, Planet Smoothie, Popeyes, Pinkberry

BODDIE-NOELL ENT

303

Hardee’s

DESERT DE ORO FOODS

302

Taco Bell, Pizza Hut, KFC

SODEXO

300

Chick-fil-A, Einstein Bros. Bagels, Subway, Dunkin’, Pizza Hut, Qdoba Mexican Eats, Jamba, Moe’s Southwest Grill, Steak ’n Shake, Taco Bell, Garbanzo Mediterranean Fresh, Erbert & Gerbert’s Sandwich Shop, Freshii, PJ’s Coffee of New Orleans, Baskin-Robbins, Panera Bread, McAlister’s Deli, Papa Johns, Blaze Pizza, Baja Fresh, The Habit Burger Grill, Burger King, Auntie Anne’s, Firehouse Subs, Denny’s, NrGize Lifestyle Cafe, Which Wich, Godfather’s Pizza, Sbarro, Mrs. Fields, DQ Treat, Barry Bagels, Gold Star Chili

MASON-HARRISON-RATLIFF ENTERPRISES

300

Sonic

LUIHN VANTEDGE PARTNERS

290

Taco Bell, Dunkin’, KFC, Take 5 Oil Change Center, Long John Silver’s, Pizza Hut

PURPLE ROCK INVESTMENT COMPANY

286

Dunkin’, Rent-A-Center, Popeyes, RimTyme, Baskin-Robbins, Take 5 Oil Change Center, American Family Care, The Brass Tap Craft Beer Bar

G & M OIL

285

Chevron, ExtraMile

FEAST ENTERPRISES

285

Jack in the Box, Denny’s, Popeyes

THE COVELLI FAMILY LIMITED PARTNERSHIP

283

Panera Bread, DQ Grill & Chill, O’Charley’s, DQ Treat, Oath Pizza

EYM GROUP

272

Pizza Hut, Denny’s, KFC, Panera Bread, Taco Bell

AMERICAN WEST RESTAURANT GROUP

270

Pizza Hut

DL ROGERS CORP

269

Sonic

GS DALLAS GROUP

266

Wingstop, Subway, European Wax Center, Fajita Pete’s

66 | Multi-Unit Franchisee | Issue 1, 2024

Skin is in.

GIVE YOUR PORTFOLIO A GLOW UP.

$863K average gross revenue for top 1/3 studios*

+ 30%

of Total Gross Revenue comes from Club Orange membership program**

+ Best-in-class 93% OSAT score from our customers + Over 150 open locations and rapidly growing + Part of the Self Esteem Brands family of brands

GET GLOWING TODAY

* This information was taken from the Waxing the City 2023 Franchise Disclosure Document. 14 or 39% of the 36 franchised studios in the top one-third of the 109 studios in the survey actually attained or surpassed these results for the year ended December 31, 2022. A new franchisee’s results may differ from these results. See 2023 Waxing the City Franchise Disclosure Document for additional information. ** This percentage was determined by dividing the total Gross Revenues attributable to monthly subscription payments for the Club Orange memberships of the Studios in the data set by the total Gross Revenues of the Studios in the data set. A new franchisee’s results may differ from these results. See 2023 Waxing the City Franchise Disclosure Document for additional information. Waxing the City Franchisor, LLC: MN Franchise Reg. #10070. For New York residents: This advertisement is not an offering. An offering can only be made by a prospectus filed first with the Department of Law of the State of New York. Such filing does not constitute approval by the Department of Law. This document is not intended for the sale of a franchise. |© WAXING THE CITY FRANCHISOR, LLC | 111 WEIR DRIVE, WOODBURY, MN 55125

Mega 99 Rankings

RANK

COMPANY

UNITS

BRANDS

HMS HOST

260

Burger King, Sbarro, Chili’s, Roy Rogers, Quiznos, Popeyes, Chickfil-A, Nathan’s Famous, Auntie Anne’s, California Pizza Kitchen, Pizza Hut, Cinnabon, Smashburger, Dunkin’, Panda Express, La Madeleine, Firehouse Subs, Moe’s Southwest Grill, Einstein Bros. Bagels, TCBY, Blaze Pizza, The Counter, Kelly’s Cajun Grill, Carl’s Jr., On The Border, Baja Fresh, BurgerFi, Paciugo Gelato & Caffe, Great Steak, Steak ’n Shake, Jersey Mike’s Subs, TGI Fridays, Blimpie, Wingstop, Cold Stone Creamery, Maggiano’s Little Italy

MANNA

259

Wendy’s, Blaze Pizza

FUGATE ENTERPRISES

254

Pizza Hut, Taco Bell, Sonic

TA OPERATING

248

Popeyes, Taco Bell, Burger King, Subway, Pizza Hut, Dunkin’, Arby’s, Charleys, Fazoli’s, Black Bear Diner, Wendy’s, A&W, Baskin-Robbins, IHOP, Carl’s Jr., Tim Hortons, TacoTime, Jamba, DQ Treat, Super 8 by Wyndham, KFC

FOURTEEN FOODS

241

DQ Grill & Chill, DQ Treat

BANDON HOLDINGS

226

Anytime Fitness

ADT PIZZA

223

Pizza Hut, Taco Bell, Sonic, Little Caesars

APPLE HOSPITALITY REIT

218

Hilton Garden Inn, Hampton Inn by Hilton, Courtyard by Marriott, Homewood Suites by Hilton, Residence Inn by Marriott, Home2 Suites by Hilton, TownePlace Suites by Marriott, Fairfield by Marriott, SpringHill Suites by Marriott, Marriott Hotels, Embassy Suites by Hilton, Hyatt Place, Hyatt House

BORDER FOODS

217

Taco Bell

PREMIER KINGS

217

Burger King, Popeyes

AKASH MANAGEMENT

216

Carl’s Jr., Pieology Pizzeria, Jamba, Arby’s, Wingstop

CAFUA MANAGEMENT COMPANY

215

Dunkin’

NORTHWEST RESTAURANTS

211

Taco Bell, KFC, A&W

ATTICUS FRANCHISE GROUP

211

Sonic, Massage Envy, Crunch, European Wax Center

ALVARADO RESTAURANT NATION

203

Taco Bell, KFC, Pizza Hut

COTTI FOODS CORPORATION

203

Wendy’s, Taco Bell, Pieology Pizzeria

H&S ENERGY PRODUCTS

203

Chevron, ExtraMile, Texaco

PJ UNITED

199

Papa Johns

YELLOWHAMMER SALON GROUP

199

SmartStyle, Cost Cutters Family Hair Salon, Supercuts

68 | Multi-Unit Franchisee | Issue 1, 2024

The Leading Brand in Early Development Through Soccer

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30%

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Mega 99 Rankings

RANK

COMPANY

UNITS

BRANDS

NITU GROUP

199

Subway, Supercuts, Cost Cutters Family Hair Salon, Church’s Texas Chicken

INTERFOODS OF AMERICA (SAILORMEN)

198

Popeyes, Taco Bell, Burger King

GHAI MANAGEMENT SERVICES

198

Burger King, Taco Bell, Popeyes, Blaze Pizza

HAMRA ENTERPRISES

197

Wendy’s, Panera Bread, Noodles & Company

FRESH DINING CONCEPTS

196

Auntie Anne’s, Jamba, Cinnabon, Carvel

KOVAN GROUP

196

Dunkin’, Baskin-Robbins

A3H FOODS

195

Jack in the Box

BAJCO

189

Papa Johns

WENDYS OF COLORADO SPRINGS

187

Wendy’s

HENLEY ENTERPRISES

187

Valvoline Instant Oil Change

UNITED PF

186

Planet Fitness

MERRITT GROUP

183

Sonic

CAVE ENTERPRISES OPERATIONS

182

Burger King

RPM PIZZA

178

Domino’s Pizza

CIRCLE K STORES

170

Subway, Krystal, Church’s Texas Chicken, Blimpie, Hardee’s, DQ Treat, Noble Roman’s, Amato’s, Huddle House

WARNER FOODS

168

Jack in the Box, Noodles & Company, Panera Bread, Black Bear Diner, Popeyes

SOUTHERN ROCK RESTAURANTS

168

McAlister’s Deli

TEAM LYDERS (SUNDANCE)

167

Taco Bell, Arby’s

FULENWIDER ENTERPRISES

164

KFC, Taco Bell

FRESH ALTERNATIVES

163

Subway

CALIFORNIA FOOD MANAGEMENT

163

Burger King, IHOP

JRN

162

KFC, Pizza Hut

CARLISLE

162

Wendy’s

70 | Multi-Unit Franchisee | Issue 1, 2024

ADD POWER TO YOUR PORTFOLIO The use of portable power is on the rise, with new technologies becoming increasingly reliant on portable power. For over 35 years, Batteries Plus has provided a stable franchise investment, offering power solutions that remain essential even in the most challenging economic conditions to both consumers and businesses. With our focus on commercial business, owners have the ability to sell to business customers before their physical store even opens, thus creating a way to become profitable sooner. Not only are our products needs-based, but our business is built to offset many of the challenges facing small business owners today.

Challenge

Investment Information

Staffing Shortages

An average store requires only 5-8 employees

Rising Minimum Wage Standards

Wages & compensation percentages for the top third of stores is less than 13%*

Inflation Reducing Profit Margins

Average merchandise margin of 52.84%*

Supply Chain Difficulties

In-house, centralized distribution center. On average, our multi-unit owners, own four or more stores. Multi Unit opportunities and resales are available!

HEAR MULTI-UNIT FRANCHISEE MIGUEL PEREZ DISCUSS HITTING HIS MAJOR MILESTONE OF OVER $20 MILLION IN SALES

TOP 75% OF FRANCHISED STORES

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TOP 10% OF FRANCHISED STORES

1,982,157 *

ENTERPRISE REVENUE SPLIT

70% Retail / 30% Commercial

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. There is no assurance, however, that you will do as well. See Item 19 of our 2023 FDD for further details.

Mega 99 Rankings

RANK

COMPANY

UNITS

BRANDS

CHUNARA GROUP OF COMPANIES

160

Dunkin’, Checkers & Rally’s, Baskin-Robbins, My Eyelab, TGI Fridays, Popeyes, Take 5 Oil Change Center, Blaze Pizza, Kale Me Crazy, Church’s Texas Chicken

DELIGHT RESTAURANT GROUP

156

Wendy’s, Taco Bell

SUMMERWOOD CORPORATION

155

Taco Bell, KFC

CHAAC FOODS/ADF COMPANIES

155

Pizza Hut, Bojangles, Applebee’s

SUBWAY DEVELOPMENT OF CENTRAL FLORIDA

154

Subway

MANNA DEVELOPMENT GROUP

154

Panera Bread

B&G FOOD ENTERPRISES

151

Taco Bell, KFC

AES RESTAURANTS

151

Arby’s

AMBROSIA QSR

150

Burger King, Popeyes

COASTAL QSR

149

Taco Bell

SOURCE: FRANdata

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How 4 operators exited their businesses Written by COLLEEN MCMILLAR

Franchise Sales Case Studies

y every measure, Jeffrey Tews and his business partner and wife Susan Rather were successful and happy franchisees.

They jumped on the BrightStar Care train soon after founder Shelly Sun decided to franchise her in-home care and medical staffing business. The couple wanted to give more back to the community after long careers in business management and health care, so they became BrightStar’s fourth licensees. Their operation ultimately spread from Madison to seven other Wisconsin cities. Over 17 years, they employed approximately 5,000 caregivers who worked 1.5 million shifts. Ten years ago, their son came on board. Life was chugging along in 2022 when Sun came to Tews and Rather with an intriguing idea: Would they be interested in selling their locations to her? Thus began the odyssey of their exit. With every beginning, there comes an end. But what factors do franchisees need to consider when deciding whether it’s time to hand over the keys to someone else? What does the process of exiting a franchise agreement involve? What groundwork should be prepared ahead of time? Experts say it’s never too early for succession planning. As franchisees research what’s involved with entering a franchise agreement, they also should be looking just as thoroughly at what it takes to get out of it. Yet a great number of franchise operators don’t begin with the end in mind. Much can be learned from the experience of others. In the following four case studies, operators share how they decided to exit franchise agreements and how the process worked for them.

CASE STUDY 1: STICK TO THE SCRIPT

When Sun’s offer came, Tews and Rather already had been contemplating retirement. He was entering his 70s, and both were ready for a less hectic life and more travel. Months earlier, Rather says, they had sat down with their son. “We had a heart-to-heart with him and told him that we were getting ready to step down a little bit more and asked if this was a path that he wanted to take on his own,” Rather recalls. “He said, ‘I love working with you guys, but I don’t want to do this on my own.’” The couple didn’t really have an exit strategy. The offer “just kind of fell into our lap, and it was a good time,” Rather says.

Former BrightStar Care owners

No real estate was involved. They had six offices that they leased. Those leases were transferred to the buyer. The parties worked out the purchase price by analyzing multiple EBITDA figures. “From our perspective, it was finding a fair value of the ongoing revenue stream,” Tews says.

The two of them felt they had a strong team in place that could keep the businesses going without disruptions during a handoff. That was important because they wanted to ensure that their clients and the clients’ loved ones continued to have the peace of mind that BrightStar afforded them.

Employees have acclimated well to the new organization. At Sun’s request, Tews and Rather have made themselves available for their former director-level employees. “If they’ve got questions or things we can help with or problems they’re trying to solve and they want to use us as a sounding board, we’re available for that,” Tews says, “and we committed to Shelly to do that for the remainder of 2023.”

“Families—when they’re at a spot where they need to count on additional care for a loved one, it’s a real trying time,” Tews says. “To find somebody who's going to care for your mom or your dad or your grandpa or whoever it is, that’s a very important thing, and it’s important to have them feel like they’ve got a partnership with us.”

CASE STUDY 2: BEGIN WITH THE END

Tews and Rather also considered the well-being of their employees, 400 caregivers and 60 managers in 2023. They had always been empowered to offer suggestions and speak their minds. “One of the keys to our success over time was understanding that the people closest to the work were the ones who best understood what needed to be done and how it could be improved,” Tews says. “For me, the most concerning was, how would they be treated? Coming from us, we had a robust bonus plan based on their success and full benefits provided to them. We paid 70% of their healthcare benefits and had a 401(k) plan with a match.” All of their employees were in the dark about the acquisition until two months into the talks when the couple needed to bring in four of their directors who had deep knowledge of the operation.

Susan Rather & Jeffrey Tews

really drilled into our business. We were doing everything the way that they expected. Our financials were in really good shape. So, other than lots of meetings with lawyers, working through the agreement that we had already established, it was a pretty simple process.”

From start to finish, it took about four months to reach a deal. That’s because “we were very compliant franchisees,” Rather says. “All of our processes were in line with the expectations, so there were no surprises when they

Rather advises others looking for a smooth exit to make sure everything they’re doing lines up with the franchisor’s recommended procedures. “There’s a reason that you go into franchising,” she says. “If somebody’s not following the model, then it’s going to be really hard for them to sell their business.”

Mitch Cohen

Former Baskin-Robbins and Dunkin' owner

Mitch Cohen always had an entrepreneurial spirit. Straight out of college, he went to work as a nighttime manager at Baskin-Robbins in New York. Months into that job, he was presented with an opportunity to open his own Baskin-Robbins location, and he jumped at the chance. “Because the opportunity was there at what seemed at the time to be a relatively low-cost investment, I thought that this would be a Issue 1, 2024 | Multi-Unit Franchisee | 75

Franchise Sales Case Studies great place for me to kind of plant my roots and try to grow,” he says. Cohen didn’t have the money, but he had a lot of spunk. “I went to the people who are now my business partners and made a proposal that maybe we should come together on this, and they said I’d have to put some skin in the game,” Cohen says. “I would advise against what I did: I went out, back in 1983, and took cash advances on some credit cards. It was pretty risky. I raised my end through the highinterest credit cards that I had, and we opened our first location. Relatively soon after that, we had six locations, and then it just started to blossom.” He and his partners would go on to open 15 combined Dunkin’ and Baskin-Robbins locations. One Long Island location also included a Nathan’s Famous restaurant. They were still in development mode in 2016 when a lucrative offer came their way from a person who had a specific interest in expanding on Long Island. “We looked at the multiple and said, ‘Wow, we probably will never see that number again,’” Cohen says, “and decided that we would sell.” But he later learned that the rose came with some thorns. “We were not in the selling mode when we were approached,” he says, “which was part of the problem because we never had an exit strategy prior to being approached.” Cohen and his partners sat down with their financial advisors. They talked about taxes on their potential windfall. “Being in business for so long, that created a very big liability. This is where I caution people now, having learned from my mistakes,” he says. “Silly as it sounds, as you’re entering into the franchise business, you should be planning with an advisor a strategy that’s robust for when you’re ready to exit. We did not have that.”

they don’t want the brand to get involved. A lot of times, buyers will put up a small deposit, and then the brand can replace that deposit. Now, for me as a seller, I’m guaranteed whatever the contract says. But for the buyer, they wasted their time, effort, and money.” Roughly 10 months after first being approached, Cohen and his partners sold their units with the brand acting as the broker. However, they didn’t leave the franchise world. They now operate eight Jersey Mike’s Subs locations and have two in development. They also have two Sola Salon Studios open, another under construction, and six in development. This time around, there is an exit strategy. Cohen advises franchisees to engage a financial adviser early. It should be someone who understands franchising, so “you’re setting up retirement funds, tax annuities, looking at what happens with capital gains when you sell it. Is there a possible rollover to a different business?” he says. “Should you be investing the money and profits that you have now, as you’re working with your units, in different facilities that would allow you to avoid some of the tax liabilities that you would have once you sell? “And then, the other thing is succession planning. The children that you have, are they going to be interested in the business? Does the franchise agreement that you signed allow you to make a transfer to a family member? The first thing you should do is review your franchise agreement to make sure that if there is an exit process, you’re fully aware of all the i’s and t’s within that process. If you didn’t do it before, you should absolutely do it now.”

CASE STUDY 3: LOOK FOR OPPORTUNITIES

As attention-grabbing as the offer was, the actual price still had to be negotiated. “It ended up that they gave us an offer that was an extremely high multiple,” Cohen says, “and then when we gave them the financials, that number changed.”

76 | Multi-Unit Franchisee | Issue 1, 2024

“The brand, and our stores in particular, got a huge boost from Covid,” says Hertzman, who had bought his first restaurant 36 years earlier. “The fact that we were considered an essential business, we were able to be open. And we were a drive-thru business. We got a great shot in the arm, so to speak, in both sales and profits.” With business booming, he decided it was time to exit. “I felt that I was going to get the best valuation that I might ever get,” he says. Hertzman reached out to franchise broker Rick Ormsby, the managing director at Unbridled Capital. It took 14 months and a couple of attempts, but the sale closed in December 2021. The buyer was another Checkers & Rally’s franchisee. That made it easier to secure approval from the franchisor. As for negotiating the price, Hertzman says, “We had a number, and they had a number, and we came to an agreement.” Hertzman also was partnered with his brother, Allen, in 26 Papa Johns locations in Columbus, Ohio. His brother ran the Papa Johns division of their portfolio and decided to test the waters for a potential sale. In October 2022, they sold the Papa Johns locations after more than 30 years of ownership. “We had great operations, good profits,” Hertzman says. “The brand was bringing really good multiples. We got a nice offer, and we accepted it. The buyer also was a longtime Papa Johns franchisee.” The Hertzman brothers didn’t have a longlaid exit plan in place, but they were well versed in their franchise agreements. They had only a few pieces of real estate, which they sold with the restaurants. Mostly, it was a matter of transferring leases. “There’s not much we would do differently,” Hertzman says. “In our situation, it was the right time for us to exit the brands. After a lot of years, we felt we left our people in good hands with the purchasers.”

That deal went sideways, but Cohen and his partners were firmly in selling mode. They soon found different buyers. However, the brand exercised its right of first refusal. “Here’s a tidbit for when people are exiting the system,” Cohen says. “If the brand has the right of first refusal, the seller must make sure that the buyer puts up a very large deposit if

Joe Hertzman had amassed 30 Checkers & Rally’s restaurants in Kentucky and Indiana when the pandemic hit in 2020. He found himself perfectly situated for the coming storm.

Joe Hertzman

Former Checkers & Rally's and Papa Johns owner

Hertzman says he wanted to give his 25-yearold son Alec “a runway and a career in business as well.” In April 2022, they bought two Jersey Mike’s Subs in Indianapolis and now own nine locations in Indiana and Kentucky. “More than likely, he and I will work out a deal where he’ll take me out at some point

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Franchise Sales Case Studies when he’s learned enough to run the company,” Hertzman says. “Right now, he’s a district manager in Louisville and working very hard and doing a great job.” His advice for those thinking of exiting the business? “Look for the opportune time when you think you’ll have the greatest value to sell, when equity value is at its highest,” he says. “Fortunately, in the Rally’s out of Covid, we were in a great spot. And Papa Johns—with it being a very strong brand, we were also in a good position to sell.” It starts with running an efficient, customerfocused operation. “We ran our businesses the best that we could to create the most value so that, when it was finally time to sell, we hopefully got the best price,” he says.

CASE STUDY 4: BE REALISTIC

Each sale required a different calculation of whether it was the right time. In some instances, it was clear. “All the cookies and pretzel stores, those were mall-based concepts. And in the late 1990s, I made a decision to actually avoid the top-tier, regional megamalls because the rent was so high, and I felt like the business model wasn’t as strong at that level,” Falk says. “I deliberately went to B and C location malls. I thought that those would kind of be community malls, and they would last for a long time. “But as we got into the mid-2000s, you could see that those malls just weren’t going to survive. The customer base shrank more and more. I decided it was time to get out before the malls closed on me, and I didn’t have a place to be.” Falk transferred ownership of the last unit he operated in 2020. But he still has a hand in the franchise game. Over the years, he’s learned about exiting franchises on the fly. The process of securing the right buyer and negotiating the right deal has taken as little as four months and as long as three years.

Sean Falk

Former Great American Cookie and Pretzelmaker owner

Sean Falk was flipping through a newspaper in 1998 when he happened upon a classified ad and learned that a Mrs. Fields store was for sale in his hometown. Though he had a successful corporate career, Falk thought the time had come to bet on himself. He bought the store in Monroe, Michigan, but he didn’t stop there. He expanded his portfolio to include Great American Cookie, Pretzelmaker, Once Upon A Child, and Salsarita’s Fresh Mexican Grill. At one time, Falk had 14 units in Michigan, Ohio, Kentucky, and Tennessee. He’s learned a lot about buying and operating franchises, and he’s learned a lot about selling them. He’s sold to partners, he’s sold to other franchisees, he’s found buyers on his own, and he’s found them using franchise resale brokers. 78 | Multi-Unit Franchisee | Issue 1, 2024

He agrees that, ideally, franchisees should have well-thought-out exit strategies, but he understands why many don’t. “When I first started being a business owner, I didn’t necessarily have an exit strategy because I just wanted to grow, to add more to my portfolio,” he says. “If anything, the only strategy I had was kind of stair-stepping. I would buy a bigger, better, more profitable location and maybe let the least profitable location just expire or sell it.” Now, he’s an owner-investor in three Scenthound locations. The franchised doggrooming businesses are operated and coowned by his children. He’s a mentor, sharing all the knowledge he’s soaked in. “The kids and I will test the market periodically,” he says. “We’ll decide if we want to grow. We’ll decide if we want to keep it open based on profitability and if the market encourages a sale or not.” His advice to franchisees who are considering selling is to run your businesses the best you can, adhere to franchisors’ standards, and have a realistic idea of what the businesses are worth. “There are a lot of first-time franchisees who don’t know how to value a business. They may look into selling it, and their asking price is just unrealistic. Let’s say a franchisee opens a loca-

tion and spends $500,000 on it, and it’s losing money,” he says. “And they decide, ‘I want to sell this.’ They go to the market and say, ‘I want to sell my location for $500,000. I just want to get out of it what I’ve got into it.’ “Well, no one’s going to buy that because they have a record that it’s losing money. You don’t value it on what you have in it. You value it on what it produces. Is it something that produces profit and income? Not only will savvy buyers realize that, but you’d have to actually trick somebody to give you $500,000 for an unprofitable business. And if you found somebody like that, the franchisor isn’t going to approve them. And if that person who’s buying it has to get a loan, no bank is going to give them a loan on a company that is losing money. So that transaction will never happen.” 

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The Future Is Now Are you giving customers the experiences they demand? Written by M. SCOTT MORRIS

Customer Expectations

t’s been said that serving your customers is the same as serving your business. It’s a simple equation, but one that shifts over time as expectations change. McLain Hoogland, president of Hoogland Restaurant Group, understands how drastically the sand can move underfoot. At one time, his family owned nearly 900 Family Video stores, where people could walk the aisles, pick out a movie, and take it home.

McLain Hoogland president of Hoogland Restaurant Group

“Family Video was really well known for customer service. That’s what set us apart from everybody else. It was the more traditional customer service, face-to-face customer service. Somebody walks in the door, the bell rings, and somebody’s looking at you in the eye,” Hoogland says. “We wore ties. We were a little bit fancier video store at the time than Blockbuster, which had the raggedy blue shirt that everybody knows.” Everybody also knows streaming killed the video store, but Hoogland and his family adjusted. In 2010, they connected with an up-and-coming franchise called Marco’s Pizza. Hoogland Restaurant Group now owns and operates approximately 120 restaurants throughout the Midwest, and times have changed again. In the early days, online sales accounted for 20–25% of orders. “We’re not getting that many phone calls anymore,” Hoogland says. “With DoorDash and Uber Eats, we’re almost 70% online. You’re not really interacting with a human anymore. You’re interacting with the machine. Their only touchpoint is really a delivery driver, and at that point, they don’t want to chitchat with the delivery driver.” People still call in, and when customers come to pick up their orders, employees are expected to be friendly and courteous. But there’s been a shift partly driven by Covid-19. Business owners and customers had good reasons to avoid face-to-face contact, and that has driven the emergence of artificial intelligence

(AI) and other rapidly evolving technologies. According to a 2023 report in Forbes, 97% of consumers say customer interactions affect their brand loyalty. In addition, 61% say they’re willing to pay more for good customer service, and 88% say the customer experience means as much to them as the product or service. The numbers point to the importance of providing high-quality experiences, but customer expectations aren’t static things. They shift from person to person and from sector to sector. In the pizza world, speed, taste, and accuracy rule the day. However, some customers choose meals or experiences exactly because they offer the opportunity to slow down. Andrew Brennan is co-owner of Quaker Hospitality Holdings, which owns 20 Penn Station East Coast Subs in Cincinnati and Dayton, Ohio. He says the sandwich brand has taken a slow and steady approach to change that preserves the company’s core business. “People forgot what it’s like to really have a pleasant dine-in experience and sit down and have a nice sandwich delivered to them. They don’t know what they’re missing,” Brennan says. “Dine-in has come back significantly, and we’re not keen to abandon that model.” That’s not to say that Penn Station leadership is against change. “Fast-casual customers have many different ways to get products and get food, and that continues to evolve whether it’s the app or online or drive-thru or pickup,” he says. “That’s definitely an accelerated and fundamental shift that I think is here to stay.”

Andrew Brennan co-owner of Quaker Hospitality Holdings

Successful franchisees have always found new ways to serve their customers because tastes and expectations change, and sometimes, guests don’t know what they want until someone offers it to them. In short, taking care of customers and anticipating their future needs are moving targets for multi-unit franchisees. “As an owner, you try to evolve and slowly adapt to changes in customer expectations or industry trends,” Brennan says. “At the same

time, we like to control our product and control how our customers access our brand.”

Traci Nocito

owner of 4 Hand & Stone Massage and Facial Spa locations

Power to the people Traci Nocito, the owner of two Hand & Stone Massage and Facial Spa locations in Pennsylvania and two in South Carolina, has a front-row seat for the AI revolution and the difference it can make. Hand & Stone’s scheduling system allows clients to book their next pampering sessions without help from staff members. “It definitely gives them more control because they don’t have to call in. They don’t have to wait for someone to schedule them. They can go right on our Hand & Stone app and schedule their appointment,” Nocito says. “It does make it nice because they’re not having to wait to have someone call them back. They’re not having to wait for a human. It just automatically does it for them.” Of course, the human connection hasn’t gone out of style for everyone. Nocito says younger clients, especially Generation Z, get the most use out of the scheduling app. Others still prefer to talk to someone. “I think we have to have an avenue for each type of customer, so I don’t think I will go completely AI, but I think there’s room for it,” Nocito says. “I think we need to grow with the clientele. We have to give them what they’re looking for. Also, if they’re looking for that human touch, we need to give them that. If they’re looking for a bot to use, we give them that.” Technological advances also allow franchisees to provide more personalized service. Well-written loyalty program software can easily sort through piles of data points before a staff member can say, “How may I help you?” Adam Saxton, co-CEO and owner of The Saxton Group, oversees 72 McAlister's Deli locations. He says the restaurant’s app is making sure customers get what they want. “It does understand what your preferences are. It understands what you like to order, how Issue 1, 2024 | Multi-Unit Franchisee | 81

Customer Expectations loyal a guest you are, and how frequently you visit,” Saxton says, “and then your offers and rewards are customized for you.” One of the overriding rules for The Saxton Group is to serve guests in the most convenient way for them. That can include dine-in, online ordering from the table, online orders for pickup, and third-party deliveries. The app takes the idea of loyalty rewards and customizes it for each guest. As Saxton says, chocolate chip cookies are great, but they’re not everybody’s idea of a reward. “We get to know them, so we can reward them in a way that is meaningful to them,” Saxton says. “It’s expanding that old promise of McAlister’s genuine hospitality where we really get to know our guests and want them to get to know us. It’s just taking that same service model and that same promise that we’ve had to our guests since we started and expanding that into the digital space.”

Jennifer, Jack, & Ryan Manville owners of 4 Spavia locations

Relaxation for sale When Ryan Manville was looking for a franchise to buy, he wanted one that technology would not disrupt. More than six years ago, he chose to team up with Spavia. He and his wife, Jennifer, now own three Spavia locations in New Jersey and one in Tennessee. “From a financial perspective, it works because it’s not a business that can be easily ‘Amazoned.’ I always use the term ‘Amazoned,’” he says. “An online retailer can’t do it, and we’re decades away from AI and robots being able to do a facial or a successful massage. Massage chairs are not really the same. I saw that it had longevity.” His locations use bots to answer the phone and computers to handle the scheduling, but the spa business is about stepping away from the stresses of modern life. That includes leaving technology behind on the way to relaxation and rejuvenation. “You get into a spa robe and slippers, and 82 | Multi-Unit Franchisee | Issue 1, 2024

you put your life in that locker—the cell phone stays in the locker,” Manville says. “It just gives you a break from that overall barrage whether it’s texts or email or surfing the web or anything like that. It’s a respite from the modern world. It’s nice.” The pandemic posed a potential existential threat to the spa industry, but as fears of infection have receded, people found they wanted to treat themselves. Both Spavia and Hand & Stone use a membership model, so clients get treatments each month, and they’re able to purchase massages, facials, or other services at reduced rates. “It’s an easy sell for us. Everybody has to take care of themselves,” Nocito says. “It’s like people think of it as an hour out of their life that they can unplug once a month. Who doesn’t want to come take care of themselves an hour out of the month?” Because customers don’t always know what they want until they get it, Nocito offers special deals to her members on a regular basis, so they can try different treatments. “They’re all offered a discount on Himalayan salt stones or CBD oil or whatever I’m offering. It gives them a taste of what we have to offer besides a Swedish massage,” Nocito says. “Whether it’s massage or on the aesthetic side, we do all kinds of little things throughout the month and the year.”

home office. From that feedback, Marco’s now offers the Pizzoli, a handheld pizza wrap with American cheese. “That was a direct reaction to customers,” Hoogland says. “Marco’s did a really nice job of saying, ‘What does the customer want?’ They want a handheld. They want a lunch product because who wants to go get a small pizza and have to take a nap after lunch in the middle of the day?” Hoogland is a member of the Marco’s Independent Franchise Association, which provides another way for people at corporate to learn what’s happening on the ground. Franchisees of all sizes are represented. “We’ve always considered ourselves very field-oriented,” Hoogland says. “We can’t make adjustments based off what we see and hear in the data analytics side of it. We have to be able to understand what the consumer wants, and the best way to do that is to listen to the people on the ground.” Not every innovation is welcome. Taco pizza didn’t go over well with customers, which might have been just as well. “It was difficult to make,” Hoogland says. “You’ve got to have fresh lettuce. It didn’t work, but it was worth a shot.”

Manville and Spavia take a similar approach by offering new types of treatments on a regular basis. He’s found that a third of his members crave new types of spa experiences, another third will try new things here and there, and those in the third group like what they like and stick with it.

Co-CEO and owner of The Saxton Group

“We’re always on the lookout for new advancements with different treatments or even within the existing treatments to make those better,” Manville says.

The corporate kitchen for McAlister’s Deli also likes to experiment with different menu options, but everything on the menu has to feel as though it belongs there, Saxton says.

Something new The restaurant business doesn’t sit still either. It might seem like pizza is pizza, but there’s always room for innovation, according to Hoogland. “Pizza is about speed, accuracy, and product quality, so we heavily focus on that stuff,” he says. “Marco’s has done a really nice job of looking for new things too. Nowadays, everybody’s looking for something new.”

“What McAlister’s likes to do is keep our core favorites on our menu that our customers love,” he says. “Instead of coming up with an entirely new menu item, we take a really great-selling menu item that our customers really love and find ways to enhance it or find a new version of that same item.”

The chain has a program called Tell Marco’s, so franchisees, staff members, and customers can offer complaints and make requests to the

Adam Saxton

For example, the Club is the best-selling sandwich, so McAlister’s created the King Club. It includes the same ingredients as the original but with bigger portion sizes. Saxton says it’s important to try new things while respecting the brand’s core food promise to customers.

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Customer Expectations “There are a lot of new diets going on or some new superfood or some new way of eating that everybody’s talking about,” Saxton says. “You can try to chase every food trend out there, but you’re not going to win. You’re going to end up looking at your menu and saying, ‘What is the identity of this brand? What do we stand for?’ It doesn’t have any kind of heritage brand value attached to it.” Brennan says the leadership at Penn Station East Coast Subs was slow to embrace online ordering and third-party delivery. In the wake of the pandemic, the franchisor has been “forced to jump pretty quickly into expanding our capabilities there,” he says. However, the company still believes in taking a conservative approach to change and never wants to race ahead and leave its customers behind. “Trends do evolve, and sometimes trends become more permanent,” Brennan says. “Sometimes, though, you look at it with hindsight, and it was just a fad.” With that said, some quick-service and fast-casual restaurants have been following Penn Station’s lead. The sandwich shop’s physical footprint is anywhere from 1,500 to 1,700 square feet, which results in lower rent costs and reduces the pressure to increase costs for guests. “It is a pretty simple back-of-the-house layout,” Brennan says. “We try to streamline that as much as possible and be efficient with our behind-the-counter space, which allows us then to have as many tabletops as possible in the store.” What’s next? Over at McAlister’s Deli, new construction makes shelf space available for third-party and online pickups, so customers can get their food as quickly as possible. “You have a dining experience, you have a website, you have an app, and you’re on every third-party platform,” Saxton says. “What more can you do?” That’s not a complaint. It’s an important question that successful franchisees will never stop asking because the best way to serve your business now and in the future is to serve your customers. 

Growing a business with high-value experiences Written by M. SCOTT MORRIS

Georgia-based franchisee Greg Thomas owns more than 60 Great Clips, but he doesn’t trust potential new customers to know the difference between his brand and someone else’s. “I think Great Clips is a generic name, much like Great Cuts, Sport Clips, Supercuts. I honestly can’t remember what I own,” he says with a laugh. “My neighbors don’t remember if it’s Great Clips, Great Cuts, or Supercuts.” The common names and potential confusion cause problems when he’s trying to attract more business. Traditional measures can be counterproductive. “I believe that when you advertise for our brand, you advertise for our industry, and that is a problem,” he says. “I mean, McDonald’s is distinctively different. Burger King is distinctively different. But Great Clips, Super Clips, and Sport Clips all sound similar.” The solution he came up with is one part P.T. Barnum and one part Forbes: • Barnum, the ultimately showman, said, “Without promotion, something terrible happens… nothing!” • Forbes, the business magazine, reported, “(T)he number one thing every single customer wants is an effortless, high-value experience.” When he was a relatively new entrepreneur and franchisee, Thomas created engaging experiences for his customers to differentiate his brand from the others. It started with a visit to a NASCAR race in Atlanta. It wasn’t a major league race with the top stars, but the action was there. What wasn’t there? People. “No one was in the audience,” he says. “I was like, ’Why are we sponsoring a race?’” The corporate office was set on continuing the sponsorship, so Thomas went to the president of the track. “I said, ’I want some free tickets to the race. I want to fill your stands,’” he recalls. “They said, ’This is NASCAR. You don’t get anything for free.’” Thomas persisted and eventually got the deal he wanted. Great Clips sponsored the race, and Thomas got 20,000 free tickets. All he had to do was promote it.

84 | Multi-Unit Franchisee | Issue 1, 2024

“Most ads say, ‘Come into Greats Clips. We’re Great. We’re Great. We’re Great.’ Nobody listens to that,” he says. “My ad was, ‘Come into Great Clips. Pay for a cut at full price and get free admission to the Great Clips 300 at Atlanta Motor Speedway.’” Race day didn’t go as smoothly as Thomas would’ve hoped. He was the starter who waved the green flag. He initially thought his brilliant idea was a bust because the stands were depressingly empty. “Little did I know, they were in the parking lot drinking beer until the start,” he says. “I got up there, and I did the start. I turned around, and it was the highest attended nationwide race in history for Atlanta.” He’d exceeded his customers’ expectations by giving them an experience in addition to a haircut, and the name “Great Clips” stood out from the Supercuts and Sport Clips of the world. However, while everyone needs a haircut on a regular basis, not everyone wants to spend their afternoon listening to engines roar. That’s okay. Thomas also had a plan for them. “One year, I bought Six Flags for a day. It was, ‘Come to Great Clips for a full-priced haircut and get a $10 admission to Six Flags.’ It’s a gift with purchase,” he says. “Another year, I did, ‘Come into Great Clips for a fullprice haircut and get free admission to the College Football Hall of Fame and a Chick-fil-A biscuit.’ Another year, it was, ‘Come into Great Clips, get a full-price haircut, and get halfpriced admission to the Georgia Aquarium.’” For the 2024–25 season, he plans to do a similar promotion with a professional lacrosse team, Georgia Swarm. He’s betting he can put people in the stands by promoting his business in a way that would’ve made P.T. Barnum proud. He’s also giving his customers the effortless, high-value experiences that Forbes says modern consumers crave. “The best part for me is I’m having fun growing my business,” Thomas says. 

Forecasting 2024

MUFC board members predict the year ahead

Written by KERRY PIPES

They are seasoned franchising veterans who have faced all kinds of challenges during their careers and continue to thrive.

To gain insight into how multi-unit franchisees can navigate the year’s shifting conditions, we tapped into the wisdom of the Multi-Unit Franchising Conference’s Board of Directors.

Here’s a deeper dive into their thoughts and strategies for the year ahead:

s the variable winds of 2024 whip through the franchise marketplace, multi-unit operators find themselves between concerns about an economic slowdown and the allure of growth and opportunity. While some forecasters predict choppy waters ahead, savvy multi-unit franchisees know they hold a unique advantage: the power to craft customer experiences and value propositions that other independent businesses simply can’t match.

Some common themes emerged, including economic uncertainty, labor market tightness, and supply chain-related issues. They also pointed out that tried and true strategies, such as embracing operational excellence, prioritizing customer experience, and leveraging innovation, can help multi-unit operators not only survive but thrive in the dynamic landscape of 2024.

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Forecasting 2024

AZIZ HASHIM

Managing partner of NRD Capital. The company’s franchise portfolio includes well-known brands Ruby Tuesday and Frisch’s Big Boy as well as fast-growing brands Fuzzys Taco Shop and The Captain’s Boil. What is your vision for the economy, the franchise marketplace, and your own business in 2024? The economy will be under pressure due to the continuing impacts of rampant inflation, high interest rates, and declining consumer discretionary spending capacity. Years of easy money policy has created a number of asset bubbles which will now have to reset with the new reality of normalized cost of capital. The franchise marketplace has also been affected by the aforementioned stresses. In the recent past, franchise resale transactions have benefited from lower interest rates that are now resetting, causing a material impact on profitability. At the same time, many operators have raised their retail prices to record levels to counteract inflation. Those price increases are causing alarming reductions in traffic count— the lifeblood of retail operations. Lastly, development costs to open franchises have reached peak levels caused by materials, equipment, and labor inflation greatly reducing the unit economic profitability and, therefore, the ROI for many businesses. 88 | Multi-Unit Franchisee | Issue 1, 2024

At NRD, we have taken the view that the unit economic model of franchising, particularly in the restaurant space, must be disrupted and reset. Franchisees deserve an opportunity to receive a compelling return on invested capital for the risk they take in developing franchise units. We have created a new portfolio of franchise brands under our Experiential Brands platform, such as The Original Hot Chicken, Flametown Burgers, and several more, that focus solely on franchisee profitability. This year, we will begin offering these brands to franchisees. In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? Franchisees will have to come to grips with the new economic realities of inflation and lower consumer tolerance for high prices. Underperforming units, which have long been absorbed by multi-unit franchisees as an inevitable consequence of owning a larger portfolio of units, will have to be dealt with differently. Development agreements that were signed under very different economic circumstances will have to

be renegotiated. The notion of opening new units at considerably higher costs and lower margins will be untenable for some brands. What are some ways multi-unit franchisees can prepare their businesses for 2024? Multi-unit franchisees should take a hard look at their portfolios, particularly at underperforming units, and “prune the tree.” As difficult as that may be, it is the key to long-term success. They should also look at development agreements, particularly with brands that do not offer attractive unit-level economics, and renegotiate with brands regarding the size and perhaps schedule of new development. Finally, multi-unit franchisees should look for new opportunities that are risk managed, such as lower start-up costs, quicker returns of invested capital, and lower labor requirements. In other words, it’s time for a complete portfolio review and reset to get ready for the next phase of the economic cycle.

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Forecasting 2024

MITCH COHEN

A multi-unit franchisee with multiple Sola Salon Studios and Jersey Mike’s Subs locations. What is your vision for the economy, the franchise marketplace, and your own business in 2024? I am looking toward 2024 with an optimistic eye. If the Fed starts to lower the interest rate, I think the public will have more confidence in spending on our businesses and also investing in franchise businesses. For our development, we are growing at the same pace, two to three units a year. In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? If access to capital is available, I believe we will see growth in existing MUO and single-unit operators making the jump to multi-unit and multi-brand. What are some ways multi-unit franchisees can prepare their businesses for 2024? I think no matter what business you have, it’s all about the people. I think hiring and retaining great people will allow all of us to grow. We also should be keeping an eye on the supply chain and availability of equipment to build new locations. This is certainly not last on my list, but we need to stay informed about any local, state, or federal legislation that might be in the works that could affect our franchising business model. We should make sure we work with each area of the government to provide insight into these policies to protect the model. 90 | Multi-Unit Franchisee | Issue 1, 2024

KARIM KHOJA

The founder of Bravo Hospitality Group, a multi-unit franchisee of Comfort Suites and Four Points by Sheraton. What is your vision for the economy, the franchise marketplace, and your own business in 2024? I think the economy will be fine, and a soft landing will happen as the Fed has played it perfectly so far. The franchise marketplace is great and robust. I see a lot of unique non-QSR franchise opportunities. My franchised hotels should do better in 2024 due to pent-up demand from business travelers. Companies are finally starting to book faceto-face conventions and out-of-town meetings. The past two years were a big struggle. In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? I feel business is going to be great for all multiunit franchisees. I do believe top lines will be

very healthy. What I can’t predict is the labor force and how we have to solve the labor shortage, especially for all QSRs. Also, costs have gone up too much and expenses have gone up too much. I don’t see a return back to old costs pre-Covid. This is going to be a tough act for franchisees to raise prices carefully. What are some ways multi-unit franchisees can prepare their businesses for 2024? Just be organized and be on top of your game. Franchisees that are in the A-game league will be winners. Consumers have too many choices now—more than ever—and the franchisees that provide the best service will end up being winners.

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Forecasting 2024

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ROBERT BRANCA JR. FIORENTINO President, general counsel, and director of development for Branded Management Group and Branded Realty Group, and he is a franchisee with Dunkin’, RimTyme, and more. What is your vision for the economy, the franchise marketplace, and your own business in 2024? While we seem to be in unprecedented times, we have seen other economic cycles where things seemed different but each presented opportunities. The one thing that continued to deliver against these opportunities was sticking to the same simple fiscal disciplines that brought you to where you are. The math never changes. I actually reflected on this after the passing of Charlie Munger, Warren Buffet’s business partner. Munger was a man with a knack for distilling complex matters down to simple aphorisms that remained true decade after decade. Another constant is the waxing and waning of the regulatory state, which is in full wax mode right now. What is different now is that franchising is a loudly stated target of the government. This focus is not just on wrongdoing but on the incredible business model itself. That is new and extremely troubling. In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? We will see continued consolidation, both of franchisors and franchisees, as those who can raise capital in these challenging times will take their share. Only more sophisticated players with greater resources and the ability to deal with the torrent of regulatory assaults on their businesses will be able to operate prof92 | Multi-Unit Franchisee | Issue 1, 2024

itably. One hopes that they will become even more engaged in Washington, D.C., and with their local governments through our excellent trade associations or on their own. Success in protecting the franchise model is critical. Our Multi-Unit Franchising Conference has been the prime place to witness the growth of multi-unit franchisees. Every year, we see the goals that they set the year before be realized or exceeded. We have seen “umbrella” franchisors form and grow. Some are a collection of brands in the same sector while others span sectors, each trying to attract multi-unit franchisees to take up as many of the brands that they offer as possible. That certainly can facilitate expansion because you are dealing with the same players across all of the brands and often using the same franchise and territory agreements. What are some ways multi-unit franchisees can prepare their businesses for 2024? Multi-unit franchisees can’t tell the future, but they can work hard to manage their risk. No one can eliminate risk and still grow returns, but you can hedge against interest rates, renegotiate leases and loan terms, form strategic alliances, and diversify and try to own your real estate if that fits in your wheelhouse. I find it instructive to think of overall business planning like a casino: Players may all be gambling, but the house is just doing math— continuously. Try to be the house.

President and CEO of Benetrends Financial and a director and board member for Swiss Farm Stores and Saxbys Coffee.

What is your vision for the economy, the franchise marketplace, and your own business in 2024? My vision for the economy is that we certainly have challenges going into 2024. As they say, it’s an election year. However, I see the opportunity for growth in the franchise space as independent businesses will continue to struggle with brand recognition, purchasing power, and advertising hurdles, leaving the market to the larger brands and the strength in numbers. In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? Multi-unit franchisees will certainly have the upper hand in creating a customer experience and consumer value that independents will not be able to match. What are some ways multi-unit franchisees can prepare their businesses for 2024? My thoughts are to hire and retain the best people and provide the best experience. Treat them as they are the best people, and they can deliver the best experience. That wins the game every time!

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Forecasting 2024

GREG THOMAS President of LSGF Management and a franchisee of several brands, including Great Clips and Smoothie King. What is your vision for the economy, the franchise marketplace, and your own business in 2024? Economies grow and contract. It’s a natural characteristic. The U.S. economy has had several years of growth coming out of Covid, and I think 2024 will show continued growth. But not all is healthy in the franchise world. Inflation, especially construction costs, are skyrocketing. Interest rates are up. The total cost of building and opening a new store is almost double what it was just a few years ago. This massive up-front investment is not fully reflected in the current retail prices. And with consumers becoming more and more frugal with their money, I’m not sure if retailers will be able to simply raise their prices so freely in 2024. I believe profit margins are going to shrink substantially in 2024, especially for those building new stores. In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? Multi-unit franchisees will likely switch their

focus to growing through acquisition rather than new builds. I can say with full certainty that my company won’t be building any new Smoothie Kings in 2024–25. It’s just too expensive to build. Plus, the interest rates are prohibitive. On the flip side, there are a lot of older multi-unit franchisees who are simply burned out from the Covid stress of the past few years. Their margins have shrunk, their energy is gone, and their leases are almost termed out. The operators who no longer have debt will be looking to simply sell and retire. I believe resales will be more plentiful and new builds too costly. It’ll be a seismic shift. What are some ways multi-unit franchisees can prepare their businesses for 2024? Pay down debt. Start hoarding cash. And then wait for resale opportunities. Looking ahead, a recession will occur sometime down the road. I definitely don’t want to have much debt (especially at 10% interest rates) when that happens. Instead, I want to be sitting on a ton of cash, so I can go out and bottom feed.

TONY LUTFI

Has a long history in franchising that includes Arby’s, Jack in the Box, Church’s Texas Chicken, Long John Silver’s, TGI Fridays, Sizzler, Little Caesars Pizza, and Sears Appliance and Outlet Stores. What is your vision for the economy, the franchise marketplace, and your own business in 2024? The economy will remain strong, and we are likely to avoid a hard landing. That’s the prediction of Bank of America and many other reliable economists. Consumers are employed and are making more money than they have before although the cost of living continues to increase. Debt is likely to escalate because people are charging more and often living beyond their means. It is good for the economy in the short term but will have long-term consequences. Meanwhile, businesses are having to take on additional burdens courtesy of the government, and the national debt is projected to increase by $2.5 trillion in the next two years. In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? Inflation is not tamed, and it will continue to impact goods but mainly be driven by labor cost increases. Technology and innovation are the only ways we can overcome the labor challenges. There will be more machines doing the work of individuals. AI will continue to expand and play more of a role. What are some ways multi-unit franchisees can prepare their businesses for 2024? Don’t be an early adapter and pay the high cost of evolution. Also, don’t be the very last to adapt. Avoid being left behind.

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Forecasting 2024

DAVID OSTROWE

President and CEO of O&M Restaurant Group and operates 14 Burger Kings, 6 Blaze Pizzas, and 18 Taco Bells. What is your vision for the economy, the franchise marketplace, and your own business in 2024? As we look ahead to 2024, I anticipate several economic challenges that will significantly impact our business and the broader franchise marketplace. We can expect a continual increase in labor costs, interest rates, commodity prices, utilities, and insurance. Additionally, heightened regulations from the NLRB will likely add to our challenges. In response, it’s crucial for us to adapt and strategize accordingly. Our focus should be on enhancing operational efficiency and integrating technological advancements to streamline our processes. This approach is essential across all our brands with each requiring a tailored strategy to navigate these economic shifts effectively. The coming year will demand resilience, adaptability, and strategic foresight from us. We must be proactive and innovative in our approach to ensure continued growth and success in a challenging economic landscape. In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? I would break it down this way: 96 | Multi-Unit Franchisee | Issue 1, 2024

• Operational costs: The rise in labor, commodities, utilities, and insurance will significantly increase operational costs. This means tighter margins, necessitating a sharper focus on cost management and operational efficiency. • Staffing challenges: With higher labor costs, attracting and retaining quality staff might become more challenging. You’ll need to balance wage increases with productivity improvements. • Capital expenditure and expansion plans: Rising interest rates will make financing more expensive. This could slow down expansion plans or refurbishments, requiring more strategic capital allocation. • Menu and service adaptation: Cost f luctuations may necessitate menu adjustments, perhaps focusing more on cost-effective but popular items to maintain profit margins. • Technology and automation: To counterbalance rising operational costs, investing in technology and automation for order taking, kitchen operations, and even marketing can drive efficiencies and reduce labor dependence.

• Regulatory compliance: Increased regulations, especially from bodies like the NLRB, mean you’ll have to be vigilant about compliance, which might require additional resources. • Marketing and customer loyalty: In tighter economic times, maintaining customer loyalty becomes crucial. Effective marketing and community involvement can help in retaining your customer base. • Supply chain management: With commodity price hikes, managing supply chains efficiently to avoid disruptions and extra costs will be critical. • Diverse revenue streams: Diversifying revenue streams, such as incorporating delivery services or exploring new market segments, could help mitigate risks associated with economic downturns. • Local market sensitivity: If you operate across multiple states, stay attuned to local economic conditions. Adapting your strategy accordingly will be important. How can multi-unit franchisees prepare their businesses for 2024? Be nimble and learn to say “no.” Wear your seatbelt and get ready for a pullback across the board.

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Forecasting 2024

GARY JESSE GRANT ROBINS KEYSER SIMON Owns and operates 65 Supercuts throughout Pennsylvania, New Jersey, Maryland, and Delaware.

Operates multiple Sport Clips, Oxi Fresh Carpet Cleaning, Ideal Image, and Med Spa locations throughout five states.

Co-founder and CEO of LSGF Management where he oversees Great Clips and Smoothie King locations.

What is your vision for the economy, the franchise marketplace, and your own business in 2024? Uncertain. There are many factors to consider. Many favor continued growth and others point to a significant downturn. Looking at all the factors, my thinking is that there will be a downturn in consumer spending, but for our business— health and beauty—the downturn will be less significant than in other areas.

What is your vision for the economy, the franchise marketplace, and your own business in 2024? It’s going to slow down in the lower and middle levels of disposable income. Watch higher income take off.

What is your vision for the economy, the franchise marketplace, and your own business in 2024? The economy will most likely be difficult for business through at least the first half of 2024 and then start easing. Increased government compliance and regulation as well as a higher interest-rate environment will push more money toward franchises. I expect to grow my business in 2024.

In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? I think you will see reduced spending on technology, marketing, and capital expenditures. How can multi-unit franchisees prepare their businesses for 2024? Most importantly, you need a growth plan to navigate the uncertainty or downturn.

98 | Multi-Unit Franchisee | Issue 1, 2024

In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? Until they figure out how to build the locations cheaper, you will see more acquisitions than new development of locations. How can multi-unit franchisees prepare their businesses for 2024? Save cash, so when you go to finance, you are not financing as much and can have good cash flow numbers.

In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? I expect labor and rents to continue moving up while price increases will taper off, putting pressure on margins. Growth could be impeded by higher interest rates and accelerating construction costs. How can multi-unit franchisees prepare their businesses for 2024? Look toward efficiencies in business rather than relying on future price increases like the last couple of years. Have a robust labor plan. Plan for capital costs, factoring in higher interest and construction costs.

Forecasting 2024

JOHN HOTCHKISS

PAUL BOOTH

What is your vision for the economy, the franchise marketplace, and your own business in 2024? I think there is good news for all of them in 2024. And I think good news can mean not much damage to the economy, and as always, franchisees will find a way to at least stay even or increase. We opened a store today and had record sales, and all our sales are up a lot while food costs remain pretty good.

What is your vision for the economy, the franchise marketplace, and your own business in 2024? I think the economy will still be evolving from high interest rates, inflation, and student loan payments resuming. We should prepare for a mild slowdown. However, I remain cautiously optimistic. One of the things I am doing to pivot my business and to diversify income streams is to expand my B2B customer base. I want to continue to scale with the right brands and with the right capital partners.

Operates 46 Little Caesars Pizza and three Firehouse Subs, and he is involved in real estate development in Texas and Louisiana.

In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? I think, mostly, all the good brands will do better, and the bad do worse.

How can multi-unit franchisees prepare their businesses for 2024? We use mostly cash to grow and stay away from the 8% loan rates. We’re glad we did. It’s also a good opportunity to buy some assets like real estate, and be sure to have the best culture for your team. Be grateful and share the wealth with the most important people around you.

The president of Concentric Brands, which owns and operates Ace Hardware locations.

In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? I think the numerous dynamics in the economy will affect various businesses differently. In some industries, we have already seen a cooling of record pandemic levels. In a dynamic and ever-changing environment, franchisees will have to find new and creative ways to drive top sales through diversification and new lines of business as well as finding ways to directly connect with the consumer. How can multi-unit franchisees prepare their businesses for 2024? I would say multi-unit franchisees can prepare their businesses by evaluating their people plans, assessing financials and additional capital needs, and understanding their brands and their customers.

100 | Multi-Unit Franchisee | Issue 1, 2024

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*$3,262,671 average unit volume (AUV) for the top 25% franchise restaurants comprises of 71 franchise restaurants, representing the top 25% of franchise restaurants out of 285 franchise restaurants that were open for at least 12 months as of December 22, 2022. 27 of the 71 franchise restaurants (or approximately 38% of the franchise restaurants) exceeded this AUV. The 71 franchise restaurants include franchise restaurants that were transferred during the 2022 fiscal year in a franchisee-to-franchisee transfer. It excludes franchise restaurants that opened or closed permanently during the 2022 fiscal year and also excludes franchise restaurants that were the subject of a transfer between franchisor and a franchisee during the 2022 fiscal year. This information appears in Item 19 of our 2023 Franchise Disclosure Document with an issuance date of March 28, 2023. Your results may differ. There is no assurance that you will do as well. This is for informational and illustrative purposes only and is not an offer to sell, or a solicitation of an offer to buy, a franchise. An offer or sale of a franchise will be made only in connection with a furnished Franchise Disclosure Document (“FDD”), or pursuant to exemptions available under the franchise laws from the need to furnish a FDD. Currently, the following states regulate the offer and sale of franchises: California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin. If you are a resident of one of these states, we will not offer you a franchise unless and until we have complied with applicable pre-sale registration and disclosure requirements in your jurisdiction. There is no assurance or guarantee that you will be approved for development in any geographic area. There is no assurance or guarantee as to the profitability or success with respect to building a new restaurant in any geographic area, and El Pollo Loco makes no representation of any kind in that regard. For information regarding the collection and use of data, please see our Privacy Policy. © 2024 Copyright El Pollo Loco. All Rights Reserved.

Forecasting 2024

CHARLES KEYSER

A multi-unit franchisee of Sport Clips, Oxi Fresh Carpet Cleaning, and Ideal Image. What is your vision for the economy, the franchise marketplace, and your own business in 2024? I believe on a macro level that the rich will continue to get richer, and the poor will continue to get poorer. That’s how our monetary system works mainly due to an asset/investment gap rather than a wage gap. Consumer debt went up almost a trillion dollars from Q2 to Q3 last year, and that’s material. However, I believe 2024 will become deflationary along with interest rates coming down, etc. That will keep consumer demand strong. I think this will be good for the franchise space. I see construction costs still a little higher due to the lack of labor force, and that could affect the ask/bid of M&A. It will be interesting to see where evaluations settle in 2024. As far as my businesses, I think 2024 could be a banner year. Recruitment efforts are working well, and we have strong leaders in place 102 | Multi-Unit Franchisee | Issue 1, 2024

with true buy-in. Expansion plans are in motion. The cost of capital shouldn’t be much of a factor for the deals we have in place. In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? I think multi-unit franchisees have a couple of key things to think about in 2024. One in particular is current debt. Many multi-unit franchisees took advantage of low interest rates coming out of the pandemic for aggressive M&A. In April 2020, the real rate of interest (nominal rate minus inflation = real rate interest) was -.40% or close to negative half a percent. This is mind-blowing because that means you profited almost $5,000 a year for every million you borrowed—just for borrowing! Interest rates from the banks were low. It was a good time to borrow and operators did, leading to massive growth. Depending on the cap structure, we are entering a stage where

debts are maturing and need restructuring. Margins weren’t maintained through late ‘21, ‘22, and ‘23 as projected in the beginning, which will become problematic for franchisees with large debts and low cash reserves. This is where we could see an alignment of the ask/ bid in the future. What are some ways multi-unit franchisees can prepare their businesses for 2024? I think 2024 is going to be the year of base hits for most and swinging for the fences for a few. I think it will be a necessary year to get back to basics. Many franchisees grow quickly and need to refine some things internally. I believe 2024 will prove to be a year that the “better” and the “best” will come out well while the “poor” and even “good” operations run real risk of setbacks or worse. To prepare for 2024, I’d spend time making sure the company keeps the main thing the main thing: people, products, and service.

Forecasting 2024

SAM ASKAR

A multi-unit operator with Church’s Texas Chicken and Dunkin’ locations.

What is your vision for the economy, the franchise marketplace, and your own business in 2024? Our belief is the economy will slump in 2024. Our brands are value-driven brands. Value-driven brands typically perform better in bad economic times. We must execute well in our value brands to outperform in the market. In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? Multi-unit franchisees that are overleveraged could be in a tough situation. High costs already make it tough to manage profitability, so servicing debt may become a problem. What are some ways multi-unit franchisees can prepare their businesses for 2024? Reestablishing a new norm in this post-pandemic world will be important. This year may be an opportunity to recruit better talent. The focus should be on staffing. The quality of the team and knowing who your team is could give you the opportunity to attract customers from your competition. To be successful, it will take a combination of shedding underperforming assets, strengthening your team, and consolidating your debt.

104 | Multi-Unit Franchisee | Issue 1, 2024

NATHAN SEAN GARN FALK Operates a number of Little Caesars Pizza, Jamba, Wingstop, Dunkin’, Jersey Mike’s Subs, Cinnabon, Red Robin, and Sizzler locations.

What is your vision for the economy, the franchise marketplace, and your own business in 2024? I’m hopeful but not necessarily optimistic that the Federal Reserve can stick a soft landing. I still believe that a recession is the most likely outcome. In the franchise marketplace, consumers are generally going to feel pinched. I expect interest rates to remain elevated compared to recent history. Also, rent and mortgage payments as a percentage of income will likely remain high. I expect consumers to trade down into more cost-effective options. We believe our business is well situated because we operate value-oriented brands. In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? I think debt will remain expensive, and therefore, operators will likely be somewhat more capital constrained. Operators will likely also need to generally lean into value offerings. What are some ways multi-unit franchisees can prepare their businesses for 2024? Be thoughtful about managing major capital investments, lean into investing in their team to better service guests, and increase the value proposition to the guest.

A longtime franchisee who currently operates Scenthound locations. What is your vision for the economy, the franchise marketplace, and your own business in 2024? I feel like the economy as a whole is going to be pretty tough in 2024. We have a lot of credit card debt and national debt. We’ve been spending like crazy for three to four years, and something has to give. A presidential election that will certainly get contentious is not going to help. Discretionary spending could become a real issue. Food in franchising probably won’t suffer too badly, but some higher-level service needs could be postponed until the economy improves. I anticipate our business will continue to grow, albeit a little slower than we hoped. In what ways do you think this will impact multi-unit franchisees and their business operations in the coming year? Everyone has been so focused on their business for years now because the margins have really deteriorated. The harder times will require additional focus and creative ways to save revenue. The cost of goods in food, especially, has to stabilize for owners to anticipate and forecast their costs and pricing. Labor will also continue being a costly line item on the profit and loss statement as wages try to catch up with the inflation in pricing that has happened for the past four years. What are some ways multi-unit franchisees can prepare their businesses for 2024? Have a strategy in advance. It will be too late to address when you are in the middle of a crisis. Make decisions that treat the symptoms now, but prepare yourself for the growth that should come in mid to late 2025. If you can survive now, you will be able to flourish faster and ahead of your peers later.

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Service Culture

Be Relentless Commit to delivering awesome service Written by BARBARA NUSS

o matter what you are pursuing in life, it’s critical that you commit to being relentless in your efforts to achieve your goal. If you’re an athlete, that means training until you're exhausted. If you’re a performer, it means practicing endlessly. If you own or head a business, it means doing everything you possibly can to provide exceptional customer service. Most companies, however, don’t commit to providing service that is so awesome that it keeps their current customers coming back to them and attracts new customers who will help drive their profits. They aren’t relentless in their pursuit of driving their business to greater heights by focusing on customer service. What does it mean to be relentless? It’s an obsession with providing exceptional service to your customers. It’s a propulsive, self-directed passion to continue to learn, improve, and exceed expectations in everything you do. Much like breathing, it’s essential to your being, and it never stops. It’s a race without a finish line. It’s a reflection of the core principles, beliefs, and attitudes of people within healthy and hugely successful businesses. Being relentless requires that you follow two rules: 1. Serve the customer. 2. When in doubt, see rule number one.

108 | Multi-Unit Franchisee | Issue 1, 2024

When you are relentless, you weave customer service into the fabric of your company; you make it part of your culture. It can’t be a flavor of the week. It requires a constant and continuous dedication to providing customers with such extraordinary service that they continue to return for years to do business with you. Executives of publicly held companies might respond to what I’ve written here by saying, “Shareholder value should always come first.” Shareholder value means providing a good return on investment, but those returns don’t exist without people who buy your products or services. When you provide awesome customer service, you will drive your business to great heights; it’s a win for you and for your investors. The commitment to being relentless must start at the top of your organization and be woven into every employee at every level. It must be a belief that is shared by everyone. You must recognize that serving your customers is your most important task and then reflect that realization with every decision you make and every action you take. Every employee must be trained in relentlessly providing exceptional customer service, and that training must be provided on a regular basis. Let them know what you expect of them, and set a good example with your own actions.

You’ll never get into the Super Bowl of business unless you've got a great team; a good team will be left behind. Just as young athletes look to professionals as their heroes and role models, look for business role models that are wildly successful and profitable because of the customer service they provide. Here are a few of them I recommend you check out: Mayo Clinic, Amazon, Wilderness Safaris, Chewy. com, K-VA-T & Food City, and Northeast Delta Dental. What are they doing that you can incorporate into your organization? In every organization—and at every level and in every job—at the end of the day ask yourself, “How did my work today help, support, and serve the customer?” Being relentless in serving your customers builds the bottom line and long-term growth prospects for an organization. No matter what your business is, you must recognize that customers provide your income stream. To keep that stream flowing, keep your customers happy. Put their needs at the forefront of everything you do.  John Tschohl is the founder and president of the Service Quality Institute—the global leader in customer service—with operations in more than 40 countries. He is considered one of the world's foremost authorities on all aspects of customer service and has developed 20 customer service training programs, including Relentless Making Customer Service Your Core Principle, that are used by companies throughout the world. His monthly strategic newsletter is available online at no charge at www. customer-service.com. He can also be reached on Facebook, LinkedIn, and Twitter.

Finance

Keep the End in Mind

Even after your business is running, you need a business plan. FINANCIAL IMPACTS Your buyer’s bank considers the business value in their lending decision. They can kill the deal if they don’t see the value even if you and the buyer agree. Profits and cash flow must be adequate for the new owner to make the payments.

Start asking 3 big questions now Written by BARBARA NUSS

“In this world nothing can be said to be certain, except death and taxes.”—Benjamin Franklin

or business owners, there is a lurking certainty. Eventually, they will exit the business. Will it be a thoughtfully planned event or a disaster? The impact of a disaster reaches far beyond the owner and family. Without a thoughtful plan, employees, customers, and vendors also suffer. When thinking about transitioning the business, every owner must answer three questions: 1. When would I like to get out? This establishes your timeline for accomplishing your “Why.” Don’t know your “Why?” Investigate the question. Clarity keeps you focused on what matters most. 2. What is my number? How much money do you need to move on? If you plan to retire, what is required to provide the lifestyle you seek? 3. Who should take over? Is it a franchisee seeking to expand, a multi-brand investor, or someone yet to come along? If it is a family member or employee, be sure to tell them. It takes time to prepare your designated successor with the skills, judgment, and financial stability to ensure success. THE PLANNING PYRAMID Many start their planning by calling a lawyer. Sound legal advice is important, but it is not the starting point. Start with the foundation and move up the tiers of the pyramid. Your business is a means of achieving your personal goals. Be clear about those goals— your “Why”—and how to move toward them.

With your personal goals in mind, consider what values are most important to you and your family during the transition process. What are your priorities? Do you want to maintain family harmony, provide stability for employees, and contribute to the community? Perhaps you want to take the business to the next level, or you might want to maintain the company culture. Are you driven by creating wealth to pass on to your heirs and enabling the next generation to become owners? On the practical side, you might want to minimize taxes. How do you feel about building a personal legacy or benefiting a charity? Maybe, you want to maintain or improve your lifestyle or prioritize health issues, work-life balance, and quality of life. You also might have your own questions to consider. As you dive into the issues, involve your inner circle—at least your spouse and any working family members. The conversation forms the foundation for your plan. Because things change, revisit the conversation each year. INVESTMENT VALUE The business can represent an entrepreneur’s biggest investment. And your number may far exceed what you could sell for today. You might need to grow sales and profits to close the gap. Determine the sales and profits that would yield your number, and then set annual sales targets to close the gap. Use your cost structure (variable cost percentage and annual fixed costs) adjusted for major expansions, inflation, and other business changes to fill in the expenses by year. Don’t forget P&L projections, cash flow forecasts, and borrowing plans.

LONG-TERM VALUE WORKSHEET

years $

3. What EBITDA multiplier is realistic for your industry? 4. EBITDA target for your investment (line 2 divided by line 3)

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Having a business complicates estate planning, so get something in place. Use an attorney experienced with estate planning for business owners. You’ll need a business coach to keep you on track with your goals, an accountant for sound financial forecasting, attorneys for wills and buy-sell agreements, a tax advisor, a personal financial planner, and an insurance professional. Build your team and meet yearly. WHEN TO BEGIN? The best time to consider your exit strategy is before you get into business. Too late? Then the time is now. Start by setting personal and business goals, assemble your team, and start climbing. What happens if you don’t plan? Higher costs, less value, and more drama for everyone involved. Don’t put it off another day.  Barbara Nuss is the president and founder of Profit Soup, a financial training firm specializing in providing skills for franchisors and franchisees that enable them to trust their numbers, focus on priorities, make better decisions, and earn more profit. Visit www.profitsoup.com.

LONG-TERM VALUE WORKSHEET

1. How many years until the transition takes place? “Your Number?” 2. What’s (What you want the business to be worth then.)

How you transfer ownership has tax implications. Use tax professionals to avoid missteps before considering specific deals. What tax obligations would arise should you suddenly die? Are your cash reserves sufficient to pay the taxes? If not, your business may not survive the transition.

times $

5. What EBITDA% is realistic?

required 6. Sales (line 4 divided by line 5)

7. What average sales per unit is reasonable?

8. How many franchise units will you need? (line 6 divided by line 7, rounded up)

units

92%

FRANCHISEE SATISFACTION 1

THE SECRET TO BECOMING LODGING INDUSTRY ICONS:

PERFORMANCE al s o inc ludes

The brand that created the Upscale Economy® segment

75.8 $55.00 75.8 % % $55.00

OUTSTANDING REVPARREVPAR OUTSTANDING BRAND BRAND 2 2 3 104.7%) 3 (INDEX(INDEX 104.7%) CONTRIBUTION CONTRIBUTION

$ 40.79 54.754.7 % % $ 40.79

OUTSTANDING OUTSTANDING REVPARREVPAR BRAND BRAND 2 2 3 3 103.9%) (INDEX(INDEX 103.9%) CONTRIBUTION CONTRIBUTION

a l so incl/ ude s Contact Matthew Hostetler, Chief Development Officer, mhostetler@redroof.com redrooffranchising.com al s o i ncl ud e s

2022 Franchise Survey. 2 STR Average Revenue per Available Room Index based performance for all Affiliate-Owned and Franchised Red Roof hotels open and operating for at least one full year, and all of calendar 2022 with any temporary closures being less than 90 days, 575 hotels for Red Roof Inn and 76 hotels for Red Roof PLUS. 3 The Brand Contribution is the percentage of room revenue generated for the properties through the Red Roof Inn website, call center, group bookings, National Sales, Global Distribution system (GBS), third party web sites and by RediRewards® members booked directly with Affiliate-Owned and Franchised properties in the U.S. open and operating for at least one full year, and all of calendar 2022 with any temporary closures being less than 90 days, 575 hotels for Red Roof Inn and 76 hotels for Red Roof PLUS. This is not an offer. No offer or sale of a franchise will be made except by a Franchise Disclosure Document first filed and registered with the applicable authorities. For New York: An offering can only be made by a prospectus filed first with the Department of Law for the State of New York. Such filing does not constitute approval by the Department of Law. For Minnesota: #F-5824. Red Roof Franchising, LLC, 7815 Walton Pkwy New Albany, Ohio 43054. © 2024 Red Roof Franchising, LLC

Customers Count

FOCUS YOUR TRAINING

Discover new employees’ service aptitude Written by JOHN DIJULIUS

Editor’s Note: There are many tests and tools to measure the customer service aptitude of your employees. Every company is different as are its customers, so aptitude assessment tools will differ from company to company. This one from The DiJulius Group provides a starting point to develop your own.

he Employee Service Aptitude Test (E-SAT), created by The DiJulius Group, is a tool for measuring new employees’ ability to deliver high-quality customer service. It’s a customized test that asks 25–50 multiplechoice questions about common situations that may arise between the employee and their customer, including nonnegotiable standards, service recovery, above-and-beyond opportunities, and awkward situations. Beyond a simple job skills test or emotional intelligence test, the E-SAT tests new employee service aptitude and predicts an employee’s success in customer service. We do not recommend using an E-SAT as an interview tool or pre-employment test. Certain questions can lead to discrimination or biased hiring practices. Prohibiting these questions helps ensure fairness, promotes diversity, and upholds equal employment opportunity principles. The E-SAT should be used with current employees rather than job candidates. A significant number of potential employees would probably score poorly since most people’s service aptitude is extremely low. No one is born with it. Most customer-facing employees did not grow up flying first class, staying at five-star resorts, driving luxury automobiles, and enjoying other higher-end experiences. Yet managers expect those same employees to deliver a best-in-class customer experience during interactions with customers. It is a good bet that most of your frontline employees have previously worked for an average or less-than-average customer service company, so they were not trained on what excellent service looks like, and they were brain112 | Multi-Unit Franchisee | Issue 1, 2024

washed by a policy-driven, ironfisted manager who taught them that customers will take advantage of businesses. Nearly every company states that it has a customer-first philosophy, but how many back that up? New employees typically get initial training on a company’s operational processes—product knowledge, how to do the fundamentals of the job, and so on—but very little, if any, customer service or soft-skill training is invested up front. This is why it is so important to incorporate a service aptitude test into your new employee training.

Sample Questions 1. WHAT IF A CUSTOMER WANTS A PRODUCT WE ARE OUT OF STOCK ON? a. Tell them we are out of stock and to call back next month. b. Offer a product of lesser quality at the same price. c. Offer a product of better quality at the same price. d. Recommend a competitor’s website. e. Other: 2. HOW DO I HANDLE A CUSTOMER UPSET THAT THE PRICE OF THEIR PRODUCT INCREASED? WHAT DO I SAY TO AN ANGRY CUSTOMER?

BEST TIME TO TEST The best way to use the E-SAT is to give it right before and right after the new customer support agent goes through initial training.

a. Give it to them at a lower price.

It can be obvious which of the answers is the correct one. Often, however, the new employee would not have considered selecting that answer prior to taking the test. When an employee does answer a question incorrectly, ask them to explain. Many will say, “At my last job, I would have gotten in trouble if I did that.” These are great opportunities to establish your service culture and explain, “At our company, we want you to trust our customers and give them the benefit of the doubt. You will rarely get in trouble for something you do; instead, it would be for something you didn’t do.”

c. Offer another model at a lower price.

Create an E-SAT by brainstorming with other leaders about scenarios that come up regularly. Once you have a dozen questions, each week something will come up, and you’ll think, “That would be a great question to add.” These evolving conversations will provide a huge boost to your customer relations experience training, resulting in a team well versed in delivering on your brand’s product and service guarantee.  John DiJulius III, author of The Customer Service Revolution, is president of The DiJulius Group, a customer service consulting firm that works with Starbucks, Chick-fil-A, Ritz-Carlton, Nestle, PwC, Lexus, and many more. Contact him at 216-839-1430 or info@thedijuliusgroup.com.

b. Empathize and explain the need for the increase and refer to a sales rep for special pricing. d. Say, “Too bad, so sad.” e. Other: 3. WHAT IF A GUEST CALLS THE RESERVATION CENTER WITH A COMPLAINT? a. Ask them to calm down. Tell them you only work here, and you “didn’t create the policy, so stop yelling.” Transfer them to a salon. b. Demonstrate active listening skills and empathy. Apologize for the inconvenience and let them know you will do whatever you can to make things right. Thank them for the feedback: “It helps us to improve our service.” Let them know you will personally look into the situation and ask if there is anything else you can do. Follow through. c. Roll your eyes. While they are talking, put down the phone and pick it up occasionally to say, “Uh-huh, I see.” d. Say, “I can’t tell you how many times I have heard that. We are always having that problem.” Tell them you will send them a gift certificate for next time, but you can’t promise it will be any better.

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People

Keep It Legal

Tipping rules should align with state and federal guidelines Written by MARY LOU ATKINS

If the role meets the first two prongs of the three-part test, they are not tip eligible. Please research your state law. Some states have tip pooling requirements that are more restrictive than the FLSA, so not allowing the assistant managers and team leaders to participate in tip pooling would be advised. Legal entanglements

o tip or not to tip?

This is a question that companies are asking themselves today. Is accepting tips worth it? Tips today are used to increase the employees’ wages to remain competitive in a market. However, there is a cost to the employer. On average, employers pay approximately 11% in taxes on tips. It is also the responsibility of the company and management to know who on the team can receive tips and to ensure the business complies with the Fair Labor Standards Act (FLSA). The FLSA prohibits employers from keeping any portion of employees’ tips for any reason, whether directly or through a tip pool. Supervisors, managers, or employers are not eligible for tips even where a tipped employee receives at least the federal minimum wage (currently $7.25 per hour). Who can be tipped?

Managers and supervisors are not eligible for tips. This role includes any employee (1) whose primary duty is managing the business, department, or region in the company; (2) who customarily and regularly directs the work of at least two or more full-time employees; and (3) who has the authority to hire or fire employees or whose hiring and firing recommendations have weight.

A manager or supervisor may keep only those tips they receive directly from a customer for the service they directly and solely provide. For example, a restaurant manager who serves their own tables may keep their tips from customers they served but would not be able to receive other employees’ tips by participating in a tip pool. When an employer pays its employees a cash wage of at least the federal minimum wage per hour, the employer may impose a mandatory tip-pooling arrangement that includes employees who are not employed in an occupation in which employees customarily and regularly receive tips. This is sometimes known as a nontraditional tip pool. For example, an employer that implements a nontraditional tip pool may require tipped employees, such as servers, to share tips with non-tipped employees, such as dishwashers and cooks, but only if all workers receive a direct cash wage of at least the federal minimum wage. An employer may not receive tips from such a tip pool and may not allow managers and supervisors to receive tips from the pool. If assistant managers, team leaders, or shift managers’ primary role is to assist the GM in operational functions, manage administration and staff, and maintain the facility, they are not allowed to participate in the tip pool.

Major lawsuits that have been in the news are: • In March 2018, the Hennepin County District Court approved a settlement in a class action lawsuit against Surly Brewing Company in Minneapolis. The settlement made the news because of the settlement size, $2.5 million, and it highlighted the tipping rules of the Minnesota Fair Labor Standards Act. There were three tip-pooling arrangements in place at the company. The courts found this to be a violation of the Minnesota FLSA. • Dos Amigos Burritos, a restaurant in Concord, New Hampshire, wrongfully included managers in its employee tip pool, which led to the recovery of $61,788 in tips and liquidated damages for 39 workers. • Starbucks has reached a $6 million settlement to resolve a class action lawsuit that claimed the company violated state law regarding tips and wages. The class action includes Starbucks employees in Oregon who had deductions taken from their wages for taxes on imputed tips. • Bar Vegan allegedly paid tipped employees $2.13 an hour while requiring them to give up 25 percent of tips they earned. To date, there has been no settlement. Please refer to your labor attorney if you are unsure of whether or not your employees are eligible for a tip pool. Companies can be sued for tipping violations even if the owners don’t know they’re breaking the law. Do your research and make sure tipping is right for you.  Mary Lou Atkins sHRBP, is the vice president of human resources at Chicken Salad Chick. She is a seasoned and strategic HR executive with 40-plus years of experience in the restaurant industry. She is skilled in talent and performance management as well as employee relations. She joined Chicken Salad Chick in 2019 as human resources director after previously holding various positions within operations, training, and HR at Popeyes over the course of 35 years.

114 | Multi-Unit Franchisee | Issue 1, 2024

Exit Strategies

Before and After the Sale When selling, think professionally and personally Written by CARTY DAVIS

rticles and white papers focus on maximizing value when preparing your business for sale. Oftentimes, these articles emphasize that successful planning and preparation increases the chances of a successful closing by meeting the requirements of the buyer, seller, and third parties, such as franchisor, business partners, and capital providers. However, it’s also important to think about the personal side of the sale and consider what life will be like after the transaction.

produce higher savings and positive adjustments to EBITDA.

Professional planning Financial planning, due diligence, and process planning should begin 12–18 months before initiating a formal sale process. Franchisees should focus on what they can control. COGS and labor should be at the forefront. Consider the inventory and ordering practices of your management team. Are there ways to save time, expense, and waste? Labor should also be monitored to avoid overtime, unnecessary regulatory fees, and overstaffing/understaffing.

Identify team members who will likely stay with the business after the sale. Consider an amended compensation plan to emphasize improvements to KBIs. When telling vital employees about the sale, let them know how they can benefit. In most cases, a buyer will retain key operating employees and all store management and crew.

A supply chain and purchasing review can quickly reduce costs. Many small to mid-sized firms have unnecessary increases in food, paper, and labor combined with distribution markups. Carefully audit all your skews for pricing, quality, and total cost, including distribution. Several firms that conducted pricing reviews saved 12–15% on overall purchases, reducing COGS by 2–4%. After key expenses have been thoroughly examined, develop a plan to improve EBITDA with minor adjustments. Be prepared to answer questions from the buyer because disclosure will gain trust. Buyers almost always identify issues through due diligence and/or a QOE report. Focus on maximizing results in the short term without compromising the company’s long-term prospects. We recommend reviewing all addbacks or adjustments to ensure a positive third-party review. A longer time frame for improvements should 116 | Multi-Unit Franchisee | Issue 1, 2024

Eliminate unnecessary expenses and projects that have a marginal ROI. Work with franchisors and landlords to close underperforming stores to increase value. Negative EBITDA stores often compromise value more than operators realize. Negotiate rents on marginal stores that cannot be closed, and avoid spending on remodeling projects with little upside.

Study the requirements of your franchise agreements and the rights of the franchisor. It is best to avoid this discussion with a franchisor until late in the process. Organized franchisees that present a qualified buyer and a signed agreement have the best probability for a successful transaction. Personal considerations Many sellers focus their efforts on the economic and valuation aspects of the sale without fully considering whether the sale, timing, and eventual exit make sense for the seller personally. We often work with sellers who have decided to sell without thinking about the magnitude of their decisions. We do not subscribe to this approach. Sellers are often surprised by how their lives outside of the core business will be affected. Self-reflection is important, and sellers should take time to consider the bigger picture: • Why are you contemplating a sale? Why now? • Do you have other businesses that you’ll retain post sale?

• How will you spend your time after the transaction? • Can you move on to the next phase of your life seamlessly? Keep in mind that cleaning up paperwork and closing the business will occupy a lot of time in the first six months. We’ve worked with owners who have not planned, had limited hobbies, and had a hard time adjusting to life post sale. Partners and family It is essential to discuss your decision early with your business partners. Ensure your interests are aligned and there are no surprises for the partners in valuation, process, and post-sale proceeds expectations. Partners will need to consider their next steps personally and professionally as well. They may also be potential buyers, and discussions should happen early in the process. Family discussions should be contemplated early as well. Are other family members involved in the business? How will you address their needs? Have you fully discussed and evaluated the event with your spouse and/or partner? Are they supportive of the transaction? Retirement Have you worked with your tax and financial advisors on tax planning and post-tax proceeds? Will the amount be sufficient to move to the next phase? Can you imagine your identity without being an owner or franchisee of that business? Hobbies, interests, and other business investments can keep you busy post sale. Have a reasonably good idea of how you will fill your time and a plan to execute it. In some cases, a life or business coach might be retained to help you through the process. While the business and economic reasons for a sale are critically important, don’t ignore the personal aspects and how your life will change. No one will ever have all their questions answered on life post sale. Nevertheless, planning for the business and personal aspects of the transaction is key to a smooth sales process.  Carty Davis is a partner with C Squared Advisors, a boutique investment bank that has completed hundreds of transactions in the multi-unit franchise and restaurant space. Since 2004, he’s been an area developer for Sport Clips in North Carolina with more than 70 units. Contact him at 910-528-1931 or carty@c2advisorygroup.com.

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This is not an offer to sell or a solicitation of an offer to buy a franchise. Any offer to sell a franchise will be made after individuals have been qualified to receive a Franchise Disclosure Document. For those individuals who qualify, an offer to sell the franchise will only be made in conjunction with the delivery of a Franchise Disclosure Document (FDD). YOU SHOULD NOT TAKE ANY FRANCHISEES' STATEMENTS OR THEIR EXPERIENCE AS AN INFERENCE THAT THE PURCHASE OF A FRANCHISE IS A SAFE INVESTMENT OR THAT FAILURE, LOSS OR DEFAULT IS IMPOSSIBLE OR UNLIKELY, OR THAT EARNINGS OR PROFITS ARE ASSURED.

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Investment Insights

Predictably Unpredictable Consumer behavior defies rational expectations Written by CAROL M. SCHLEIF

“The pendulum of the mind oscillates between sense and nonsense, not between right and wrong.”—Carl Jung

or much of the past few years, we have been perplexed over the seeming disconnect between consumers’ collective dour mood—expressed to pollsters in a variety of regular sentiment surveys, such as the monthly University of Michigan Consumer Confidence reading—and their actual fiscal resources. Theoretically, individual financial situations on the backside of the pandemic were far superior to those experienced by most in this country after the Great Recession of 2008– 09. Aggregate household net worth has never been higher, debt service levels have been low, and the unemployment rate has been below 4% for the better part of the past two years. After the Great Recession, unemployment hit double digits, personal bankruptcies soared, and millions lost their homes or were substantially underwater, leaving financial situations irrevocably altered. Yet moods were nowhere near as sour then as this time. The trillions in aid provided directly to consumers during and after the pandemic plus a raging jobs market provided ample choices and mobility. Economic opportunity for the median citizen is in substantially better shape than after the Great Recession. Even though moods have been dour, spending has been strong— first on goods, then services, and more recently on both categories. The disconnect between financial mood and personal economic reality is perplexing. We suspect the primary factor at play boils down to an underlying sense of vulnerability. Consumers simply are not the “homo economicus” (rational beings) that economists expect them to be. In most models of economic behavior, theorists project that individuals will make decisions only after a careful analysis of potential risk and return. But in the real world, emotions and personal biases prompt actions that bear little relation to the predicted outcomes. 118 | Multi-Unit Franchisee | Issue 1, 2024

As we came out of global lockdown, our worlds had been upended in virtually every aspect of personal and work life. That unpredictability can create havoc for business owners, politicians, and our economy where consumers power nearly 70% of U.S. total output. Meme stocks, cryptocurrency meltdowns, viral Tik-

Toks, and spur-of-the-moment Amazon Prime purchases wouldn’t cycle with as much speed if each of us popped open our “risk/return” mental calculator before making decisions. For investors, consumer behavior affects corporate results directly and indirectly. Think of disruptions to toilet paper, appliances, autos, and concert tickets in just the past three years to see the footprints of consumer behavior imprinted far and wide. In coming out of the pandemic, the severe swing in consumer behavior moving from goods to services prompted the massive dislocations that spawned a rapid spike in interest rates. The Federal Reserve’s historic tightening—525 basis points in little more than a year—prompted historic dual bear markets in both stocks and bonds. The Fed also tightened by reducing the size of its balance sheet, which is down more than $1 trillion from where it ended during the pandemic era. While the monetary tightening worked relatively quickly at slowing the inflation rate, overall prices remain elevated relative to pre-pandemic levels, adding to the unease pervading people’s psyches.

What will 2024 hold? Consumers tell pollsters one thing even as they are behaving in a different mode. We suspect that even if they’re unhappy about higher prices, job security and the flexibility to get a new one create a sturdy base for spending. In the new year, it will be critical to watch this balance. If layoffs were to accelerate and/or the number of job openings decline, consumers could feel more vulnerable about their ability to sustain spending. Inflation itself can be distorting headline numbers, masking underlying softening. Looking at volumes, piece run rates, and YOY unit changes can be a more useful input into analysis. This is a new normal for many. The vast majority of the investment industry, including advisors, bankers, and analysts modeling term sheets, have never lived in an interest rate environment where the real rate was above zero. The go-forward cost of capital is likely to be more like the 1990s’ norm with “neutral” around 2–2.5%. If the Fed succeeds in getting inflation to 2%, this means base rates will start at 4–4.5%, necessitating a rebuilding of models and a reassessment of business plans. Strategies that worked with 0% money won’t necessarily net out at 4.5% plus. Watch key consumer health numbers closely in 2024. Consumers face many headwinds that, so far, they’ve been able to resist: resumption of student loans, higher health insurance, rent, day care, and other costs. Credit card bills and buy-now-pay-later contracts from the robust holiday selling season will also come due in the first quarter. Should the labor market continue to cool, this combination of influences could amp the feelings of vulnerability. Monitoring critical consumer data points such as overall debt service levels, unemployment claims, continuing claims, and delinquencies will be telling signposts for investors and companies alike as we attempt to project how consumers will behave in the year ahead.  Carol Schleif is chief investment officer at BMO Family Office, a wealth management advisory firm delivering investment management services, trust, deposit, and loan products and services through BMO Harris Bank. To learn more, visit www.bmofamilyoffice.com.

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IFA Legislative Update

ENGAGED IN 2024

IFA uses a balanced approach to protecting franchising Written by MATTHEW HALLER

s we ring in 2024, many of us have begun mapping out goals for the year to come. As you think about your year ahead in franchising, I encourage you to keep IFA in mind as a reliable partner and source for you in this year and many to come. Throughout 2023, we delivered on our promise to protect, enhance, and promote franchising—and we are only just getting started. There’s no better place to set your year up for success than at the 2024 IFA Annual Convention, Feb. 17–20, in Phoenix. Recognized as the “Best Event” by Entrepreneur Media, our convention consistently attracts the industry’s most prominent figures. Over the years, we’ve hosted showstopping keynote speakers, such as NBA star and Big Chicken franchisor Shaquille O’Neal and NFL legend and multiunit franchisee Drew Brees. This year will be no exception and will feature a star-studded roster, including influential personalities and business leaders on the main stage. It will also provide unparalleled opportunities, lessons, and best practices woven through the exhibit hall and each breakout session and networking reception. The 2023 IFA Annual Convention marked a milestone as the largest and most successful yet with more than 4,000 participants, and

120 | Multi-Unit Franchisee | Issue 1, 2024

attendees can expect an even more impressive experience at our 2024 convention. The event is a key opportunity to bring the franchise community together each year, but each day at the IFA headquarters in Washington, D.C., our team is fighting to protect you and your business from policies that could disrupt franchising as we know it. That includes fighting the National Labor Relations Board’s (NLRB) new joint employer standard, which is set to go into effect in February. In my recent testimony before the U.S. House Education and the Workforce Committee’s Subcommittee on Health, Education, Labor, and Pensions, I shared with lawmakers the power of franchising. I also discussed the detrimental effect this new expanded NLRB standard would have on the franchise business model. I explained that, nationally, franchising is a driver of economic growth, and individually, it’s a creator of generational wealth for people from all walks of life. Rest assured, IFA is doing everything in its power to stop the new joint employer standard from taking effect. Joined by stakeholders from across the business community, IFA has filed a lawsuit against the NLRB for this expanded rule. On a separate track, we are also encouraging lawmakers to support a bipar-

tisan, bicameral Congressional Review Act resolution that would put a stop to NLRB’s regulatory overreach. But we don’t just oppose policies at IFA. We are for many policies that will improve franchising from the earliest stages. IFA is working to establish a strong framework for the franchise relationship through improved pre-sale disclosure. We are doing so by encouraging the Federal Trade Commission (FTC) to focus on enhancing the information available to potential franchise buyers in the Franchise Disclosure Document (FDD) rather than stepping in to regulate the franchise relationship once an agreement is in place. We believe that proactively providing the information a buyer needs in order to make an informed purchasing decision improves the chances of a successful relationship and benefits both sides. We will continue to work with the FTC to improve the information available to prospective franchisees so that the franchise business model can continue to thrive well into the future. The IFA team is unwavering in its commitment to improving the outlook for franchising, and we look forward to continuing to deliver on our mission to protect, enhance, and promote the franchise business model in 2024. Whether it’s advocacy, events, education, or engagement, we’re here for you however and wherever you need us. We hope to see you this Feb. 17–20 in Phoenix for a great start to the new year.  Matthew Haller is president and CEO of the International Franchise Association.

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Franchisee Tactics

Focused on Community How to become a hometown business Written by M. SCOTT MORRIS

hen your franchise achieves hometown status, you’ve accomplished something that will serve your community, employees, and business for years to come. Michigan-based David Plait, a Hungry Howie’s multi-unit operator, learned the value of creating authentic community ties decades ago. Now, 50% of his marketing budget goes toward setting up resale events with churches, schools, and other organizations. “A lot of businesses don’t realize that they have a responsibility to give back to their community,” Plait says. “When you do that, you’re doing something good. You’re also exposing your brand.” Plait isn’t against writing a check to sponsor an ad in a yearbook but prefers to give his food to groups or sell it on their behalf, letting them pocket the proceeds. In the modern world of digital marketing, Plait still relies on old-fashioned guerrilla marketing with an updated twist. Sampling is about getting pizza directly into someone’s

122 | Multi-Unit Franchisee | Issue 1, 2024

hands, so they can take a bite, savor it, and, ideally, go online to brag about the meal. Sometimes, a free pizza is the best thing that’s happened to that person all day. “There’s so much bad news in the media,” Plait says. “You want to give them a reason to say something good online.” Decades ago, Plait bought a struggling business. It was located in the back of a Dunkin’ and faced an alleyway. With no frontage, he dropped literature in mailboxes, participated in the Boy Scouts parade, and made appearances at arts festivals. But he didn’t really start making traction until a local businessman invited him to attend a meeting of Rotary International, a service organization that describes itself as “people of action.” He was surrounded by different community leaders, who were happy to welcome a new member willing to add his efforts to theirs. They raised money to eradicate polio and elevate the United Way. They also supported each other’s businesses. “I started to volunteer,” he says, “and I realized how good it felt to make a difference.”

Now, he encourages his team to get involved in the community wherever and whenever they can. While it can be difficult to reach an employee when they’re needed to take an extra shift, Plait says “they stumble over each other” to provide pizza to benefit a band, drama club, church youth group, or sports team. “When it starts becoming personal, everyone wins,” Plait says. By raising money for worthy causes while giving people the opportunity to sample the product, employees working at the event can become more connected to their community. In the process, they develop a sense of ownership. That’s important because sampling can have bad results if the staff isn’t 100% committed to making sure the product and brand image are top-notch. “If you don’t have a good team that’s excited to do it, it could backfire,” he says. Plait says it’s about getting his staff members “out of their comfort zones, away from their screens, and out in the community where they can do some good.” The community, the employees, and the business all benefit in authentic ways that go well beyond writing a check. In short, the way to become a hometown business is to be a hometown business. “This is fun. This is life,” Plait says. “This is about making a real difference.” 

Succession Planning

Working Together

Don’t let family baggage spoil a sibling partnership Written by KENDALL RAWLS

or many entrepreneurs and multi-unit franchisees, the dream of business ownership extends to creating a lasting legacy with family members. This vision often includes siblings joining forces to build a thriving franchise business. However, the journey from childhood memories to successful business partnerships can be challenging. The labels and roles we carry from childhood can influence sibling dynamics in business, so how can we overcome these challenges to build a successful franchise enterprise? Childhood roles Childhood roles and labels are an integral part of growing up in a family. Whether you were known as “the responsible one,” “the rebel,” or “the peacemaker,” these roles can leave a lasting imprint on sibling relationships. When siblings venture into business together, these roles can resurface, affecting decision-making, communication, and overall collaboration. These labels can be both a blessing and a curse. On the one hand, they may reflect genuine strengths and qualities developed during childhood. On the other hand, they can pigeonhole individuals, making it difficult to adapt to new roles and responsibilities in a business setting. Challenging old patterns The first step in overcoming the influence of childhood labels is self-awareness. Siblings must recognize the patterns and roles they tend to fall into within the business context. This requires honest introspection and an openness to change. Avoid “always” and “never” statements. Refrain from using absolute terms, like “you always take charge” or “you never listen.” Such language can reinforce old stereotypes that may no longer apply. 124 | Multi-Unit Franchisee | Issue 1, 2024

It’s also important to identify strengths. Take stock of each sibling’s strengths, skills, and expertise. Recognize what each brings to the business that contributes to its success. Leveraging individual strengths Successful sibling partnerships often hinge on acknowledging and leveraging individual strengths. Once siblings have identified their unique contributions to the business, they can develop a clearer understanding of their roles and responsibilities. Siblings should openly communicate about their strengths and areas where they excel. This dialogue can foster a sense of appreciation for each other’s abilities. Once lanes have been defined, stay in them. While offering ideas and insights is essential, respecting each other’s authority in specific areas is equally crucial. Recognize when it’s best to defer to your sibling’s expertise. Establishing a shared vision A shared vision is the cornerstone of a successful sibling-led franchise business. Setting aside old labels and focusing on a unified vision for the business can help align sibling efforts. Siblings should collaboratively define the business’ mission and values. This process allows them to center their efforts on a common purpose. The next step is to establish clear, measurable goals that reflect the shared vision. These goals will guide decision-making and provide a road map for growth. Effective communication strategies Clear and respectful communication is the glue that holds successful sibling partnerships together. Siblings must cultivate effective communication habits to navigate challenges and opportunities.

Practice active listening when engaging in business discussions. Ensure that each sibling feels heard and valued. It helps to schedule regular meetings to discuss business matters and check in on progress. These meetings can serve as forums for open dialogue. When problems arise, face them head-on. Implement conflict resolution techniques to address disagreements constructively. Conflicts are inevitable, but how they are handled can determine the partnership’s strength. Navigate challenges together Challenges will arise in any business partnership, especially when family dynamics are at play. However, these challenges can be turned into opportunities for growth and strengthened relationships. Learning is a virtue. Instead of viewing challenges as roadblocks, approach them as opportunities to learn and grow together. That might involve giving someone the benefit of the doubt because all family members in the business are juggling two contradictory responsibilities: family and business. Be empathetic and compassionate to each other’s points of view. Preserving family bonds Sibling partnerships in multi-unit franchise businesses can be a source of strength, innovation, and enduring success. By recognizing the influence of childhood roles and labels, siblings can break free from old patterns, leverage their individual strengths, establish a shared vision, communicate effectively, and navigate challenges together. In doing so, they can preserve family bonds while building a thriving franchise enterprise that leaves a lasting legacy. Success in sibling partnerships requires a proactive commitment to both personal growth and business success, and it all begins with the willingness to embrace change and evolve from childhood memories to thriving in business realities.  Kendall Rawls understands the challenges that impact the success of a family-owned business. Her unique perspective comes not only from her educational background, but, more importantly, from her experience as a second-generation family member employee of The Rawls Group - Business Succession Planners. For more information, visit seekingsuccession.com or email info@rawlsgroup.com.

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This information is not intended as an offer to sell or the solicitation of an offer to buy a franchise. It is for information purposes only. The offering is by prospectus only. Currently the following states regulate the offer and sale of franchises: California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Oregon, Rhode Island, South Dakota, Virginia, Washington and Wisconsin. If you are a resident of or want to locate a franchise in one of these states, we will not offer you a franchise unless and until we have complied with applicable pre-

sale registration and disclosure requirements in your state. New York State Disclaimer: This advertisement is not an offering. An offering can only be made by a prospectus filed first with the Department of Law of the State of New York. Such filing does not constitute approval by the Department of Law. *Figure is for all restaurants in 2022. See Item 10 of our Franchise Disclosure Document for more information. There is no assurance that you will do as well, a new franchisee’s results may differ from the represented results.

Market Trends

Grow the Thoughtful Way Check the boxes for methodical franchise acquisition Written by PAUL WILBUR

ne of the trends of the past few years has been growth through acquisition. Discerning the right acquisition targets is a pivotal step for PE groups, platform companies, and multi-unit franchisees eyeing expansion and diversification. This is especially true if you’re seeking to extend your reach beyond your traditional markets. The challenge is in identifying opportunities that align with your strategic goals and have enduring viability and consumer appeal. The best practice for uncovering choice acquisition targets is to develop a set of parameters that define your preferred opportunity. For some companies, the acquisition target is a $2–3 million business. For others, the threshold is higher and could range from $10–25 million. Once the parameters for a business acquisition target are clear, you need to gather the information that will help you identify brands or franchisees that meet your criteria. Size and sustainability Selecting the right franchise opportunity for acquisition involves a keen eye for both the size and sustainability of a potential business. If you’re looking for a brand with consumer appeal across diverse regions, target franchisors or franchisees that have substantial market presence and sales. These brands typically demonstrate market resilience and growth potential, making them attractive targets for expansion-oriented companies.

126 | Multi-Unit Franchisee | Issue 1, 2024

Choosing these well-established franchise brands mitigates risk and opens avenues for significant returns. Size is directly linked to brand visibility and market presence, which are crucial for long-term success in the competitive world of franchising. Analyzing franchise brands The first step is to create an extensive information set on franchise brands, focusing on factors such as market presence and a track record of success. This information is best prepared by industry experts and should include comprehensive brand information, financial health, and growth patterns. This data is essential for evaluating potential franchise systems and making informed decisions. High-performing franchisees After understanding the brand, the next step is to delve into the franchisees within these systems. Identifying high-performing franchisees is crucial for businesses planning to acquire and enhance existing franchises. This method targets franchisees that demonstrate profitability and show potential for further growth and expansion. Emerging opportunities Beyond focusing on current market leaders, it’s important to identify emerging franchise brands that show potential for significant growth. This forward-looking approach ensures preparedness to tap into new and promising opportunities in the franchise market.

Research and data The backbone of this acquisition strategy is indepth research and data analysis. The information compiled offers insights into franchise brands and detailed profiles of franchisees, covering their financial performance and market penetration. This level of detail is crucial for making strategic decisions that align with long-term business goals. Additionally, access to detailed owner information, including their business scope and contact details, aids in developing a deeper understanding of potential targets. This granular approach is key for identifying and effectively engaging with potential acquisition prospects. Final thoughts For companies aiming to expand their franchise portfolios, a methodical and data-driven approach is key. The process of identifying the right acquisition targets involves evaluating established franchise brands and their franchisees as well as keeping an eye on potential upand-coming franchises. It’s critical to partner with firms that specialize in franchise analysis and are equipped with the necessary tools and databases. By investigating well-established brands, high-performing franchisees, and emerging opportunities, companies can make strategic decisions that foster growth and diversification. In the ever-evolving franchising industry, such a thoughtful and informed approach is essential for sustained success.  Paul Wilbur is COO of FRANdata where he is instrumental in building the company’s research and consulting framework. He manages the research, information management, marketing, and IT departments and plays an integral role in the strategic development of FRANdata’s suite of franchise solutions. Contact him at 703-740-4700.

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For more information on becoming a Central Bark® franchise owner, scan the QR code with your phone to visit centralbarkfranchising.com or call 866-799-BARK. This advertisement is not an offering. The ﬁnancial performance representations quoted are contained in Item 19 of our 2023 Franchise Disclosure Document and represent the top tercile of performance. The 2023 item 19 also include: (1) Proﬁts; and (2) system-wide gross revenue for 2022, 2021, and 2020. Your results may differ from this information and the information included in Item 19 of our 2023 Franchise Disclosure Document, and there are no assurances you will do as well.

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Save the Dates 20 24 June 18 – 20, 2024 ∙ Atlanta, GA

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ADVERTISERS INDEX

Multi-Unit Franchisee Issue 1, 2024

PAGE

COMPANY

47Concepts

Ace Hardware

American Family Care

Altitude Trampoline Park

ANGRY CHICKZ

Angry Crab Shack

Anytime Fitness

Batteries Plus

Black Bear Diner

Bonchon Franchise, LLC

Broken Yolk Cafe

BURRITOBAR

127

Central Bark USA

Checkers Drive In Restaurants Inc.

Coyote Ugly

14–15

Craveworthy Brands

Daddy's Chicken Shack®

Dogtopia

Donatos

101

El Pollo Loco

Focus Brands

130–131

Franchise Update Conference Calendar

6–7

FYZICAL Therapy & Balance Centers

Gloria Jean's Coffees

113

Hand & Stone Massage and Facial Spa

Hooters of America

HTeaO

Hungry Howie's Pizza

IFC

IHOP

8–9

Inspire Brands

123

BOBBYS BURGERS BY BOBBY FLAY

105

Kiddie Academy Domestic Franchising, LLC

KIDSUNITED

Layne's Chicken Fingers

ADVERTISERS INDEX

Multi-Unit Franchisee Issue 1, 2024

PAGE

COMPANY

129

MFV Expositions

109

Mountain Mike's Pizza

Movita Juice Bar

134–135

MUFC24 Thank you Sponsors

31 & MySalonSuite Back Cover 89

OAKBERRY

PetWell Clinic

Port of Subs

111

Red Roof Inn

125

Rock n Roll Sushi

Rockland Trust

Scooter's Coffee

128

ServiceScore

Shawarma Press Franchising

Shipley Do-Nuts

IBC

SignArt, Inc

Smalls Sliders

Smoothie King

SocialBites

119

Subway

136

TBC Corp.

121

The Habit Burger Grill

The Human Bean

106

The Local Drive

117

Tide Cleaners

Tint World

Tropical Smoothie Cafe, LLC

Waxing the City

25 & 107

Wienerschnitzel

103

Wilson Enterprises and Affiliates

Zaxby's Franchising, LLC

115

Ziebart Corporation

Ziggi's Coffee

2024 Thank You Sponsors *as of press time

MOBILE APP SPONSOR

PLATINUM SPONSORS

Tierra Encantada COFFEE SPONSOR

PRESENTATION RESOURCE SPONSOR Dill Dinkers

FRANCHISEE TOTE The Coffee Bean & Tea Leaf BAG SPONSOR

BREAKOUT VIDEO SPONSOR

MINT SPONSOR

Jersey Mike’s

Hammer & Nails Grooming Shop for Guys

LANYARD SPONSORS

SNACK SPONSOR AnswerConnect

TIRE EXPRESS

MVP AWARDS SPONSOR American Family Care CHAIRMAN'S DINNER SPONSORS

KEYNOTE SPEAKER SPONSORS

Answerconnect Franfund Polsinelli EXHIBIT HALL BAR SPONSOR

FisherZucker The Pickle Pad CONFERENCE AT A GLANCE SPONSOR Luther Lanard, PC WATER COOLER SPONSOR Benetrends Financial REGISTRATION DESK SPONSOR iFlex Stretch Studios Franchise

Hammer & Nails Grooming Shop for Guys

GOLD SPONSORS

SILVER SPONSORS Athena Assessment Beans & Brews Century Partners Citrin Cooperman Global Payments The Huntington National Bank KTA Financial Services

FRANCHISEE-ONLY OPENING EVENT SPONSORS ®

GENERAL SESSION LUNCHEON SPONSORS

Moss Adams Naf Naf Grill Neon Screens PizzaExpress Poolwerx Primrose Schools Retro Fitness We Sell Restaurants

BRONZE SPONSORS 47 Concepts Alpha Omega Franchise Solutions Budderfly Ceterus Defender's Gateway Ecotrak Facility Management Software F.C. Dadson Fish Consulting Franchise Business Review FranShares

Freshii Goodcents Hot Dish Advertising Killer Burger L & L Hawaiian Barbecue LOMA MSA Worldwide Oh-DEER Potbelly Sandwich Shop Silicon Signs STNL Advisors W.O.L.F. Fitness

GOLF SPONSORS Central Bark Dill Dinkers

Five Iron Golf

Thank You Exhibitors Ace Hardware ACT Construction Adams Keegan Alliance Human Capital Management Altitude Trampoline Parks American Family Care American Franchise Academy ANGRY CHICKZ Angry Crab Shack Another Broken Egg Cafe Anthony's Coal Fired Pizza & Wings Anytime Fitness ApplePie Capital Arby's Ascentium Capital Atmosphere Augment Auntie Anne's Bad Ass Coffee of Hawaii Bang Cookies Baskin Robbins Batteries Plus bb.q Chicken Beef A Roo Beyond Juicery + Eatery Biscuit Belly Black Bear Diner Black Sheep Coffee Blaze Pizza BOBBYS BURGERS BY BOBBY FLAY Bojangles Bonchon Franchise, LLC BooXkeeping Corp. Bowled Healthy Food Company Brazilian Franchise Association Broken Yolk Cafe Brotman Law Buddy's Home Furnishings Budlong Chicken Buffalo Wild Wings Buffalo Wild Wings Go Burger King Corp. BURGERFI BURRITOBAR Byrider Franchising C Squared Advisors, LLC California Pizza Kitchen Camp Bow Wow

Capital Connect Brokered by eXp Commercial Capriotti's Sandwich Shop, Inc. Captain D's Careington Caribou Coffee Central Bark USA CertaPro Painters Charleys Cheesesteaks & Wings Checkers Drive In Restaurants Inc. Chick N Max Church's Texas Chicken CiCis Pizza CKE Restaurants CloudKitchens The Coffee Bean & Tea Leaf ColorOnly Corporate Tax Incentives Coyote Ugly Crack’d Kitchen and Coffee Crunchtime Crush Yard Daddy's Chicken Shack® Dairy Queen Data Dynamix David Energy Del Taco Denny's Inc. Detroit Wing Company direct2you Donatos Drybar Dunkin' EF Cost Recovery Einbinder & Dunn LLP Einstein Bros. Bagels El Pollo Loco Ellianos Coffee Envoy Global Facial Mania Med Spa FARMER BOYS Firehouse Subs Five Iron Golf Fluffy Fluffy Franchise Capital Solutions Franchise Sellers Resales & Valuations FRANdata Freddy's Frozen

*as of press time

Custard The Fresh Monkee Freshslice Pizza Friendly's Restaurants Fuzzy's Taco Shop G6 Hospitality Generator Supercenter Franchising, LLC Genghis Grill Glo30 Gloria Jean's Coffees Goddard Systems, LLC. Godfather's Pizza GoDog Pet Hospitality Golden Chick Golden Corral Gong Cha Graze Craze Grease Monkey The Great Greek Mediterranean Grill Green Motion Guggenheim Retail Real Estate Partners GUINOT H&H Bagels The Habit Burger Grill Hammer & Nails Grooming Shop for Guys Hand & Stone Massage and Facial Spa Hawaiian Bros, Inc. Hello Sugar The Honey Baked Ham Company Hooters of America HTeaO Huckleberry's Breakfast & Lunch The Human Bean Hungry Howie's Pizza Hydrate IV Bar IHOP INFINITI HR International Franchise Association Iris Galerie Jack in the Box Inc Jamba Jersey Mike's Subs Jimmy Johns The Joint Chiropractic

Kensington Company & Affiliates Kiddie Academy KIDSUNITED KLA Schools Franchise Krokit Krystal Restaurants LLC la Madeleine Layne's Chicken Leasecake Lightbridge Academy The Local Drive Loomis Map Ranks Maple Bear Global Schools Marco's Pizza Mathnasium McAlister's Deli MetLife Moe's Southwest Grill MOOYAH Burgers, Fries and Shakes Morrow Hill Mountain Mike's Pizza MOXIE SALON AND BEAUTY BAR Mr. Pickle's Sandwich Shop Mugshots Grill and Bar My Salon Suite National Franchise Sales New York Fries Northern Bank OAKBERRY Occupier Office Evolution Old Chicago Pizza + Taproom Oxi Fresh Pacific Accounting & Business Services Pancheros Mexican Grill Papa Johns Paradox Parapet Studios LLC Paylocity PayMore Stores Payroll Vault Penn Station East Coast Subs Pepper Lunch Restaurants Perkins Restaurant & Bakery

Perspire Sauna Studio Pet Evolution Peterbrooke Chocolatier PetWell Clinic Phenix Salon Suites The Pickle Pad Pickleball Kingdom Franchising LLC Pickleman's Gourmet Cafe The Picklr Inc Pinnacle Commercial Capital Placer.ai Pollo Campero Popeyes Louisiana Kitchen Port of Subs PrepWizard PrimePay PrimoHoagies ProSource Wholesale Pryze PuroClean Qdoba Mexican Eats Quatrro Business Support Services Radiant Waxing Rawls Succession Planners Reality Based Group RESOLUT RE Restaurant365 RNR Tire Express Robeks Juice & Smoothies Rock n Roll Sushi Rosati's Pizza Salty Dawg Pet Salon Sambazon Savvy Sliders Scenthound Scooter's Coffee Shawarma Press Franchising Shipley Do-Nuts SignArt Sky Zone Slim Chickens Smalls Sliders Smashburger Smoothie King SnapCrack Chiropractic SocialBites SocialMadeSimple Sola Salons SONIC Southern Grounds

Specialized Accounting Services Spectrum Enterprise Speed Queen Laundry Starbird Chicken Stoner's Pizza Joint Stratus Building Solutions Subway Success Franchising LLC SUNMED SweatHouz Contrast Therapy Studio Sylvan Learning Systems System4 Taco John’s International, Inc. Text Request Tide Cleaners Tierra Encantada Tim Hortons Tint World Togo's Eateries Tommy's Express Tropical Smoothie Cafe, LLC True Payroll Integration TruOI TT Brands Turbo Tint UPizza USave Walk-On's Sports Bistreaux Waxing The City Wetzels Pretzels Wienerschnitzel Wilson Enterprises and Affiliates Wing It On! Wing Snob Wing Zone Wingers Alehouse Wings and Rings Wingstop Restaurants Woodhouse Spa Woof Gang Bakery Workstream World Gym Woven Wrap City Sandwich Company Zaxby's Franchising Ziebart Ziggi's Coffee ZippyApp Zoom Room

GO FOR THE GOLD

START A NEW AUTO REPAIR BUSINESS ™

WITH MIDAS

Midas is one of the world's largest providers of automotive services, offering brake, tire, maintenance, exhaust, steering and suspension services at over 2,100 locations in 20 countries, including nearly 1,200 in the United States and Canada. Become a Midas Franchisee today!

Beneﬁts • Top-tier brand name recognition • Expert franchise marketing support • Incredible purchasing power • Access to national ﬂeet accounts

Get started today at midasfranchise.com

Franchise Support Program for Signage SignArt provides a comprehensive platform that executes the process from start to finish for your signage program. This Proven Process is dedicated to helping franchise leaders decide the right type of signage and placement for their expanding brand on a Regional/National Level.

SignArt's Franchise Program: • All project stages: Scheduling, permits, manufacturing, installation, electricians and utilities. • Work with municipalities to achieve the best sign size and placement for the most impact/visibility. • Oversee the projects in real time, placing our customer's best interest first. • Communication is a priority.

Every Program Includes: • Survey • Site Plan • Brand Book / Design • Permits / Variance • In-House Manufacturing • Installation • Completion Report with Photos

Ignite Your Brand With SignArt signartinc.com • 269.381.3012 • 5757 E. Cork St., Kalamazoo, MI 49048

Expand Your Existing Franchise Portfolio! Salon suite franchise opportunities are perfect for entrepreneuriallyminded individuals who want to either grow their current business ventures, or explore franchising as a business option. As a MY SALON Suite franchise owner, you give stylists the opportunity to run their own business. You are the landlord, and they rent their salon space from you. MY SALON Suite is a well-known brand in this popular industry.

About a MY SALON Suite Franchise: • Semi-Absentee: No on-site staff • Multi-unit expansion available nationwide • Recession Resistant

STO P BY BOOTH #2237 AND VISIT W ITH O U R TEAM ! Chris Davenport: chris.davenport@propelledbrands.com • 214-346-5644 MYSALONSUITE.COM MY SALON Suite is part of the Propelled Brands portfolio which is the Franchisor of NerdsToGo® and FASTSIGNS® International, Inc.