The company's offering attracts consumers because of its well-organized approach to doing business in what is otherwise a highly fragmented industry. "When you get an estimate from Closets By Design, you can tell there's something different," Egner says."You're more informed.It's easier to make a decision."
For franchisees, the lure is hefty revenues and the ability to leverage talents from previous exposures to business management. "In addition to someone who's willing to learn and is trainable, we're looking for someone that has business experience, who knows how to manage and motivate people, and understands the financial side of the business," Egner says. "What we're not looking for is a carpenter. That's one of the biggest misconceptions in our industry."
Closets by Design currently has 28 locations, and while the company has had significant growth the last several years, it's not expected to soonthe number of locations rapidly any time soon. Instead, they'll emphasize helping existing individual franchises improve sales."We don't want to grow fast,"Egner says."We want to add three to six locations in 2010. That allows us to continue to focus on per-store revenue and the growth formulas."
Another occupant of the home improvement space is CertaPro Painters, a painting contractor franchise organization based in Oaks, Pa. The company's franchisees generate healthy revenues, mostly painting residences for homeowners. Steve Hearon, vice president of franchise development, says, "We have quite a few doing over $1 million and our top franchisee does over $8 million."
CertaPro Painters aims to provide a great experience to people who hire its franchisees for painting jobs. That alone, says Hearon,makes them stand out from the crowd."We're really in an industry that is not known for its customer service," he observes.To try to give CertaPro Paintersa reputation for service, the company hands every client a satisfaction survey and urges franchisees to improve their rankings. Today nearly 80 percent of customers give them a perfect rating, Hearon says.
Franchisees like the relatively low initial investment for a potentially million-dollar business. To add to the luster, overhead is also low. "There's no commercial space required, no retail space required, no real estate, no build out," Hearon says. The primary overhead costs are for vehicles, marketing, and a small office space -- some franchisees start out at home.
No painting experience is required to become a CertaPro franchisee. Sales and marketing background is, however, an asset, as are skills at managing and motivating people. Otherwise, says Hearon, they're looking for"somebody who's a leader, likes to get things done, has a high sense of urgency to get things done, does not mind being inside customers' homes talking to them about their projects and their colors, and then could turn around an hour later and be standing in front of a painter."The company has 328 locations worldwide and expects to open 50 locations in 2010.
Another concept that doesn't require industry experience is Wingstop, a Richardson, Texas, franchiser of restaurants featuring chicken wings and a handful of sides. Chief Development Officer Wes Jablonski says the simplicity of the menu makes it attractive to people who don't have the background or desire to run a more complex operation."Our franchisees tend to be individuals who are looking for a better life than they have right now,"Jablonski says."They don't have a vocation to be a restaurant operator."
While the chain's most successful location does about $1.9 million in annual sales, the average Wingstop generates about $750,000 in annual revenues.Location is the main differentiator, according to Jablonski. The company has done well in smaller towns and lower-income communities, and is now looking at a push into college and university neighborhoods. The menu, while simple, is successful: Wingstop's wings won awards for flavor three years running at the National Buffalo Wing Festival. The food is affordable, which Jablonski says has helped franchisees stay busy during the recession filling to-go orders for people who opt to eat in to help save money. "We think we've benefited form economic contraction because people are basically spending more time at home," he says.
Wingstop had 435 locations at the end of last year, and Jablonski expects to open 69 new stores this year. The concept has shown it can travel outside the state where it began. While the largest market is still Dallas and nearly half the stores are in Texas, there are also large blocks in Los Angeles and San Francisco, among others, and the store with the highest volume of sales is in Chicago.
GreenLeaf's,asalad,Panini,andwrap purveyor,andBananas, which sells smoothies and non-yogurt drinks, are a pair of concepts that, especially when co-branded together, also have thepotentialtoreachsalesof $1millionormore."Weprobably have a handful of locations that are hitting the million-dollar mark, a lot of them around $800,000, and one that does over $2 million in the Newark airport," says Andrew Steinberg, senior vice president of business operations and franchising for parent organization Villa Enterprises in Morristown, N.J.
