Are You Fit to Franchise?

Many remodelers are looking for ways to offset a slowing remodeling market. One direction some are choosing to head in is national franchise operations.

A franchise can be a great opportunity for some remodelers, in terms of national brand awareness, marketing support and a team of peers that are working toward the same goal. However, not all franchise companies are created equal and the key to optimizing a franchise system is fairly simple — do your homework.

A franchise relationship is akin to a marriage, where both parties must mutually agree to work with one another to achieve a common goal. Prior to getting involved with any new business venture, find out if this relationship fits your business structure and lifestyle.

QR gathered Mark Richardson, CR, president of Case Design/Remodeling; Doug Dwyer, president and owner of DreamMaker Bath & Kitchen; Robb King II, vice president of operations, Paul Davis Restoration; and brother and sister team, Darren and Karen Sager, principal owners of MasterShield Gutter Protection, to find out who is the right candidate to operate a typical franchise.

Questions to ask yourself before pursuing a franchising path.

Richardson: Do I want a business or do I want a practice? Ninety-nine percent of the remodeling community in the U.S. are practices and the practice generally is dependant on the principal to even exist. If you really yearn for more of a business and to exit from the business at some point, I think that’s a good question to ask yourself and I think franchising is a vehicle to be able to do that.

Dwyer: Am I willing to follow a proven system? Am I willing to get out of my comfort zone to learn new ways of doing business — Without those two things, they won’t get the benefit of a franchise system.

Richardson: Owning your own business can get lonely, its gets complicated — it’s like being on an island all by yourself. If you like that, you should not become part of a franchise community. On the otherhand, if you clearly want to be part of a group, work off of similar systems and processes and want to dialogue with others that are doing similar things, than I think franchising is a good vehicle for you.

King: What are you trying to accomplish by having a franchise relationship? Are you looking at a franchise system to relieve some pressure on your current business? If so, what is that are that you feel a franchise system can add value to? Is it around a branded product? Are you looking for marketing help? Or are you looking for something other than what their own brand represents in the market? You must figure out what you are trying to accomplish by having this relationship.

Richardson: What is my exit strategy? I’ve done talks around the country and one of the common things I ask is how many of you have an exit strategy? In a 300 person room, I might get two to three hands. That’s because there isn’t a good exit strategy in a traditional remodeling business.

Now, when I ask, how many of you would like to have an exit strategy — almost everyone raises their hands. So I think what franchises allow is an exit strategy because all of a sudden this business has equity and value that’s not dependant on you — you can sell it someday because it’s not just dependant on you.

Is it OK to have a franchise as a sideline to my existing remodeling business?

Richardson: This has a lot to do with the owner. If the owner has the financial wherewithal or the skills to be able to have multiple businesses, then I think it is fine.

However, I would say many don’t. When you start a new business, whether it’s a franchise or not — it requires a lot of focus and attention. And it’s not unusal that something’s going to suffer — whether it’s the new business or the old biz. Much as it is a strategy — it has more to do with your structure and your wherewithal. Under our system if you have a sister business, we would require you to have a general manager of the Case business and we want to meet and train the GM — without the right GM, you are going to suffer.