August 23, 2025 • 32 mins
In this full guide, franchise coach Giuseppe Grammatico reveals his transformative process for finding the right franchise. Stop wasting time and learn to identify the perfect business model for your financial and lifestyle goals.
DISCLAIMER: The information on this podcast is for general information purposes only. Franchising involves risk and careful consideration should be given before making any decisions.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Giuseppe Grammatico (00:00):
a franchise is a business on training
(00:03):
wheels.
A franchise is a business where,uh, someone else has figured out
the best way of doing business.
Not all franchises, and I willrepeat this, not all franchises
are created equally.
the goal I think in, in myopinion, is finding the right
match.
And once you find the rightmatch, I believe that business
is gonna be much moresustainable.
(00:23):
Welcome to the Franchise FreedomPodcast, where you can escape
the corporate trap throughfranchise ownership.
Here's your host, Giuseppe gr,the franchise guide.
Welcome to the Franchise Freedom Podcast.
I'm your host, GiuseppeGrammatical, your franchise
guide, the show where we helpcorporate executives experience
(00:44):
time and financial freedom viafranchising.
Thanks for joining us today, uh,for today's conversation and
show.
Wanted to discuss, uh, topics Iget on a daily basis, and I'm
sure the, uh, individuals askingthe questions aren't the only
ones that have, uh.
You know that, that thesespecific questions, so wanted to
share that on a show today, andhopefully I can, uh, inspire and
(01:08):
answer the question around, uh,franchising and franchise
ownership.
So, uh, the question was aroundessentially, you know, what are
the Fran, what is the franchiseand, and what are the
franchisees out there?
And, uh, so, so part one to thatquestion.
And I talk about this quitequite a bit, is that a franchise
is a business on trainingwheels.
(01:29):
A franchise is a business where,uh, someone else has figured out
the best way of doing business.
They have that business plan inplace they've executed on the
business, and essentiallythey're looking to grow their
business by duplicating it andhaving individual owners around
the country.
Grow that brand.
And just because there's afranchise out there doesn't mean
(01:51):
it's available in your state.
Some brands grow regionally.
You know, you see brands on theeast coast as well as, uh, just
on the West Coast, and maybethat's their.
Uh, full intention of growth andsometimes that's where they're
testing the markets and theneventually growing later.
In other cases, uh, we talkedabout this on a previous
episode, are registration statesand maybe that brand isn't
(02:13):
available yet in that specificstate.
Maybe they are relatively newand they're trying to get more
of a track record in order toregister in that specific state.
Certain registration states.
I get a lot of calls from peoplein Washington, uh, as well as
California, uh, WashingtonState, and California.
So.
You know, so that's a little bitabout, uh, franchising.
Don't look at franchisingnecessarily as an industry.
(02:35):
Um, you have franchises in, um,you know, uh, haircuts.
Uh, you have Fran franchisesaround fast food and things like
that.
That's the industry fast food.
And then you look at thefranchises within because
franchising, I would say yes,there's a lot of similar things
going on and benefits that Italked about a couple.
Episodes ago, uh, from, uh, keytakeaways from our Cincinnati
(02:58):
conference.
Uh, so definitely encourage youto, to check that out.
A couple, a couple episodes ago.
Now, when it comes to whatfranchises are out there there
are over 4,000 franchisecompanies in the US alone.
And, uh, it's good to know whatis out there.
And, uh, you know.
Entrepreneur Magazine, uh, JasonPfeiffer, for example the editor
(03:21):
in Chief of EntrepreneurMagazine, who I had on the show.
At the end of last year did areally good job just talking
about his experience infranchising and that they have
this, uh, year end or actuallybeginning of the year edition
where they talk about the top500 brands and that they break
it down by industry.
So that could be a good startingpoint.
(03:42):
But, you know, my, my, the pointof my conversation is that with
the internet, there's no lack ofinformation.
There are a list of brands outthere, but ultimately.
My whole thing and my, my goalfor today is really to challenge
your way of, of thinking the,your, your challenge your way
and really help you in figuringout and, and changing the
mindset of, of figuring out howto find the right brand for you.
(04:06):
Because one thing that I try to.
Hit home on, uh, on a lot ofthese, uh, conversations is that
just because your friend, familymember, or someone you knew was
successful with the franchisedoes not mean necessary that you
are gonna be successful withthat franchise still has the
same system and support, but itmay not be a good match based
off your personality, uh, maynot be a good match, uh, maybe
(04:28):
based off of where you'relocated in the country.
The demographics and things likethat you have to take into
consideration.
So a big part of today is thatyou can definitely find the list
of brands out there.
Some people have interest incertain industries, as I
mentioned, haircutting and fastfood and, and things like that.
Uh, but I wanted you to changeyour approach into figuring out.
(04:48):
You know, what are the franchisemodels?
Big, big change there inmindset, franchise models, uh,
that may be a good fit.
And where do we start?
So, you know, we start as we, aswe do all conversations, let's
figure out if a franchise may bea good fit.
And really it's around havingaccess to capital.
(05:09):
I always say at least 50,000liquidity, about a hundred
thousand net worth is a, is agood starting point.
Uh, we'll get into morespecifics.
You know, being able to make adecision within six months on a
brand, not opening, but signingan agreement.
I talk about that quite a bitbecause why explore a brand
when, you know, it's kinda likelooking at a home.
You, you find the home you likeand say, okay, I'll be back in a
(05:29):
year to buy it.
Well, that territory may not beavailable.
You know, specifically or that,that specific location in a
year.
So I would say start, start thedue diligence when you have a
goal of making a decision in sixmonths or less.
And you're okay followingsystems because just like we
talk about E Myth Revisited byMichael Gerber, the whole idea
of systems, that's exactly whatyou're getting with the
(05:51):
franchise.
You're getting systems and, uh,the intention is to follow the
main system, to follow themarketing and everything that
franchisor is providing you.
So.
We get past, yes.
Okay.
Franchising may be a good fit.
Uh, I'm not looking to reinventthe wheel.
You know, I, going back to your,wanna, wanna make sure we have a
strong enough, why, why are youdoing this?
(06:12):
What are you looking to, uh, tocreate from this?
And then we get into the kindof, the, the meat of this call
is the ideal business.
You know, how do we, how do wefind the ideal business?
And again, you know.
In the same industry, you'regonna find multiple brands in
mosquito spraying and roofinghaircuts, fast food, you know,
(06:32):
gyms and things like that.
Not all franchises, and I willrepeat this, not all franchises
are created equally.
Every brand, you know, they maybe in a similar industry giving
the customer or client the sameservice, providing the same
service, but ultimately they maybe run differently.
Uh, these are characteristics.
Uh, one franchise, a in themosquito spraying space may have
(06:55):
you.
Running the business full-timein spring the backyards of
people's homes and the otherone, uh, allows you running it
part-time where you'reoverseeing the marketing, the
KPIs, and, and just the, thesystems in place.
So, you know, going back tothese, these characteristics
that I talk about, I just talkabout this all the time.
It's so crucial because having aclear idea, even if you've never
(07:19):
owned the business before, andthis is, this is where I can
help getting an idea of what.
You know, an idea of what thatbusiness may look like from
these characteristics we'regonna talk about really helps
you to scale down the brands,uh, you know, that, that, that
are gonna be available in yourmarket.
So let's, let's go through someexamples of, of things to think
(07:39):
about and then we can go backand, and revisit and see where
the, the match is.
So, you know, a big part of thisis where you are located.
Location, you know, the, thespecifically, uh, or general
area.
So you may live in Chicago andmaybe it's one of the suburbs in
Chicago, but you have thatgeneral area.
Now a brick and mortar business,uh, you know, specifically,
(08:01):
maybe it's a standalone buildingor in a shopping center, uh, may
say, you know, we have room forthree locations, so you're not
really figuring out the exactspot.
A third party will come in andhelp you there, but we wanna
figure out the, the Chicago areaand, uh, or the, or the suburbs,
anything beyond that.
Anything beyond the center ofChicago going back in hours is,
is too far out.
(08:22):
That is one way to really scaledown your business because
sometimes we see ads, especiallyif you're doing research
nowadays, and you may getretargeted, an ad may pop up and
it sounds great.
Obviously it's an ad, right?
They're, they're gonna make itappealing, but we wanna make
sure that it's in a market thatyou're comfortable with, you're
not driving two hours to get towork at a location or what have
(08:45):
you.
So location, I think is, is, isa big one, and it would really,
really help you scale back.
You know, the, the number ofbrands because, uh, first off,
it has to be registered in yourstate of Illinois.
Uh, secondly, it needs to beavailable in your market.
So, uh, and all, you know, thisis something to, to really
consider and, um, I encourageyou to, to really think, Hey,
(09:06):
are we, are we he, are westaying here for the long run or
are we thinking of, of moving?
That's a great place to start.
So if you are thinking ofmoving, uh, or have dual
residency or, or thinking ofeventually moving in a year.
Maybe look at, you know, where,where you'll eventually move and
see if it works within thetimeframes.
Second piece of this is money,money, money, money.
(09:27):
We need to be able to fund thisfranchise and not, you know,
there, there there's this wholeidea of, you know, the money you
capital you have, but you don'twanna overextend yourself.
Uh, so I encourage everyone tolook at their financial
situation.
Break down, you know, you knowall your savings accounts,
checking accounts put all yourassets together on the left side
(09:50):
of a piece of paper and all yourliability.
So assets are anything you own.
You know, IRAs, real estate.
And that could be the, andthat's gonna be the, the assets
gonna be the value of the home.
Approximate.
And then there's a liability.
What's the mortgage on there?
Do you have any student loans?
Credit card debt auto loans.
Uh, maybe you have a secondproperty.
(10:11):
An investment property that hasa mortgage on it, you know,
write that stuff down and youstart figuring out net worth.
So assets.
Minus li uh, liabilities is yournet worth.
Uh, and then you're figuring outyour liquidity.
What a, you know, what access doyou have to capital your
checking, savings, stockaccounts, and things like that.
Number, and, and it provides tworeasons.
Number one is the franchisorwill have liquidity and net
(10:33):
worth requirements.
Uh, number two, it, it's good tohave those numbers because I
always encourage everyone, ifyou are.
Leaving your job to run thisbusiness full time.
You wanna make sure to have somecash reserves for the business
and personal expense.
You know, everyone's situationis different, and this is where
we do a little bit of a, of adeeper dive.
But if you're, if there'ssomeone else in the home, maybe
(10:54):
it's your spouse that is workingand their income is covering the
expenses, great.
You wanna have a little bit of abuffer there and make sure you
have enough to fund the businessand, and some reserves aside.
In the event, the business takemaybe takes a little bit longer
to get up and running.
So I always encourage you there,but I, I also encourage everyone
to speak with a funding company.
We work, uh, closely with acompany called Benetrends and
(11:17):
they will do a full evaluationwith you at no cost, looking at
your different options such asyou know, uh, can I use a
retirement rollover?
An SBA loan, which you talkquite a bit about, or even a
home equity line of credit.
Uh, they'll go through yourdifferent options, some things
to, to think about and theydon't provide, you know, every
product, they'll provideretirement rollovers and SBAs
(11:40):
and things like that.
Even un, you know, assistingwith unsecured loans.
Uh, but if it's something like ahome equity line of credit, uh,
they'll encourage you to speakwith your bank and see kind of
what the rates are, you know,what their requirements are and
things like that.
So, uh, financials, if you comeback and, you know, the numbers,
a 50,000 liquid, a hundredthousand net worth, and the SBA
(12:01):
pre-app approves you for a loanup to 200,000, maybe we stay
within that and that obviouslyalso reduces, right?
Kind of narrows the search down.
Uh, for the first business, italso helps you figure out, okay,
you know, if we're, you know,looking at 200,000, is that
gonna be enough for a brick andmortar type of business?
Or is should we stay more in thehome-based service, uh, kind of
(12:25):
area or industry?
Uh, so thi things to thinkabout, getting a full financial
picture, looking at all theoptions.
Um, these options will also helpyou figure out the number of
locations, the number ofterritories that you're looking
to explore.
Uh, so financials are gonna bebig, and I encourage everyone
after having our first call andsending back the questionnaire,
we, we always send anintroductory email to Beres to
(12:48):
do a full analysis of, of kindof your financials.
Now we look at, you know, thevenue.
The venue also is a big one herebecause.
This is where I kind of splitthe franchises in half on one
side, uh, on the left side, youhave home-based service
businesses.
What is that?
Well, it's something that reallycould be a business that could
be run from home.
(13:08):
Maybe you're going to abusiness, maybe you're going to
a homeowner and providing aservice.
Business coaching.
It may be it's expensereduction.
It's, uh, water and smokemitigation.
It could be mosquito sprayingroofing.
Uh, essentially you don't needan office.
Maybe you get one down the, uh,down the low, uh, down the road.
Uh, a flex space and office witha, with a warehouse.
(13:29):
But, um, essentially theadvantage here is number one,
you'll be up and running in oneto three months, uh, after
signing the franchise agreement.
And that's gonna be dependenton.
Your availability, the nexttraining dates and what is
needed for the business.
Are there trucks and equipmentneeded?
Do you have to get vehicleswrapped?
If not, you know, you can getup, you can get up and running
(13:50):
sooner than later.
But these businesses are notonly up and running pretty
quickly.
Uh, the investment's gonna beless, I would say a good, uh.
Area is about a hundred to250,000 depending on the
business, the requirements.
Is it a, you know, W2 or 10 99labor model?
There's so many differentvariables, but, um, that gets
you thinking about, hey, youknow, I, I, you know, I do wanna
(14:13):
get up and running sooner thanlater.
I may wanna look at a home-basedbusiness to open up potential
office outside the home youknow, later on.
Also the idea of that lowerinvestment works works better
for me.
Uh, on the flip side there,there's brick and mortar.
And with brick and mortar, theseare essentially, you need a
location.
Customers are coming to you,right?
It's a different, completelydifferent strategy.
(14:34):
You do the marketing and, andthe customer comes to you.
So these could be gyms it couldbe food prep, uh, different
venues around that, health andwellness, cryotherapy.
Uh, IV nutrition, uh, haircuts,uh, facials, pedicures, tanning,
waxing, you name it, falls inthe space.
And these businesses, becausethey are a brick and mortar,
(14:57):
that franchisor will usuallyprovide a third party for a fee
and, and find that rightlocation for you.
Because there's a location andthere's a landlord, it's gonna
increase the time to get open.
I would say six to 18 monthsdepending on the specific
location.
Working with the landlord andhow, how, um, how simple, you
know, what's, what's, uh, what'sthe build out look like
(15:19):
specifically for that space.
Maybe you have a gym franchiseand there was already a gym in
that space, so maybe a, a, aquicker build out time.
You know, permits and all that.
So it really depends on, uh, thelocation where you fall in the
country.
3, 3 50 thou, three 300 to350,000 would be the average.
Uh, could it be less?
Yes.
Could it be more?
Absolutely.
(15:39):
But those are just some, somegeneral ranges.
Uh, and then you get into thestandalone world where you're
getting into trampoline parksand, and certain stretch salon
suites and things like that.
And now you're getting into.
A much more robust, larger buildout, standalone building.
There's a lot more costsinvolved.
You don't have to own thebuilding.
Some people do.
(15:59):
Most people will lease.
Uh, you're getting into a sevenfigure investment and I would
say one to two years plus to, toget open.
So they, they all have to fallwithin your comfort range.
And sometimes that alone helpsyou scale back and say, you know
what?
For my first business, I want tobe up, up and running sooner
than later, and people go theservice route.
Other people are okay, um, youknow, opening up at a later
(16:21):
date.
But my job is not to tell youwhat's better or worse.
My job is to tell you these arethe things to expect when
looking at these businesses.
So we call it the venue, adifferent way of doing business
that the clients and customersare coming to you.
A bigger investment you know,it's gonna take longer to get up
and running.
And those are things toconsider, especially if, uh, you
were recently laid off and maybeyou need to generate income
(16:44):
sooner than later.
Maybe the, the, the home-basedservice business may be a better
match.
So that is anothercharacteristic that we, we look
at.
And by the way, there is zerocorrelation between the, the
investment and the return.
Uh, the goal I think in, in myopinion, is finding the right
match.
And once you find the rightmatch, I believe that business
is gonna be much moresustainable.
(17:06):
You'll do, you'll do much betterbecause you enjoy the business.
And it will excel on your skillsets, which is the next
characteristic.
Um, and that characteristic isreally what your role as the
franchisor, excuse me,franchisee is gonna be in the
business.
Uh, so the franchisee's role,and usually the franchisor is
gonna look for thattransferrable skillset.
So if you are on Wall Street,like myself.
(17:28):
Do you need investment strategyand financial planning to be
able to run the business?
No, but what that franchisor maybe looking at was someone that
could network and be, become themayor of the town.
Someone that was, uh, is, isgreat at management, which we
see a lot in cleaning withlarger number of staff.
What is that skill set that youbring to the table?
(17:50):
You know, what is the averageday in a, in, in a life look
like?
Now, keep in mind, day one, theaverage day in a life is gonna
look much, much different thanday 365, a year later.
So day one is getting every, youknow, learning the business,
getting trained, getting up andrunning, finding the right
staff.
And then, uh, you know, afterthat, that first year.
Hopefully key staff is in place.
(18:12):
Revenue's been generated,hopefully some profit's been
generated as well, where you cankind of take a step back to see,
okay, these are the role, thisis the role I wanna take in the
business.
These are the areas I reallyenjoy and I'm gonna take that
role and, and I'm gonna hire outfor the rest.
So, uh, role is gonna be a majorpart of it.
Again, another characteristic,helping you scale down in the
(18:32):
business.
And then there's, you know,there there's other
characteristics and sometimes.
There is no preference,especially if you've never owned
the business before.
Uh, such as, uh, what do youremployees look like?
Kind of a crazy question.
And, um, what that means isessentially are they W2
employees where, you know,you're paying them an hourly
(18:53):
wage or salary, training them onevery aspect of the business, or
are they a 10 99 contractorwhere.
You're utilizing a roofer toreplace a roof, an existing
roofer where they're bringingtheir own equipment and trucks
and things like that.
So definitely differences, uh,and pros and cons between a W2
and a contractor.
And we dive into thosedifferences.
What does that look like?
(19:14):
Well, a contractor, uh, you'regonna have a lower investment
simply because, um, you know.
You're not paying, typically thecontractor until JA job is, uh,
is awarded, completed, and paidfor is when the contractor's
getting paid.
And, uh, those are somebenefits, keeping the investment
lower and you know exactly, youknow, what the, the contractor's
(19:34):
getting paid and what yourmargin is on the business.
So another, anothercharacteristic of the business
goals of the business.
You know, are you looking to,you know, grow the business as
fast as possible and sell in acouple years, 2, 3, 4, uh, five
years?
Or is it to create a long-termlegacy?
Uh, there are gonna be somebrands that will scale a little
(19:55):
bit quicker.
Others will have more of amembership model where you're
slowly building this, this baseof clients that become this
annuity, right?
This revenue stream.
You know, you start off withmaybe you gain 10 customers a
month.
At the end of the year, you haveover a hundred customers that
are paying you to that offeringa service, like maybe a mosquito
spraying or pest control type ofbusiness where you're building
(20:16):
and you're not, you know,starting at zero every month.
You know that you have theserevenue, that revenue stream,
that annuity is what I like tocall it.
So.
When you approach it that way,it's a completely different mind
shift.
But when you break thesecharacteristics, like, what's my
comfortable investment?
One other thing I didn't talkabout in the investment also was
the cash injection, right?
I can get approved for 200,000,but what, what's my injection?
(20:38):
Well, it's gonna be just say20%.
So I'm okay putting$40,000, uh,down in order to get the, uh,
the loan to, to obtain the loan.
My role in the business, whereI'm located, my employees, what
they, what, what specificallythey look like.
Do I, you know, as far as acontractor, W2, where am I
located?
Uh, do I prefer that brick andmortar or something I can run
(21:01):
from home?
Once you.
And, and, you know, and, andsometimes you may be indifferent
on these, but the goal is reallyto, to nail them and have some
preferences there.
Then we can go to work to seewhat brands are available in
your market.
Even just for fun, let's checkto see if there are any resales
available in your market.
There may be someone that maybethey're retiring you know,
something happened in lifethat's forcing them to sell.
(21:22):
We just had a, uh, we were justapproached with the a resale
that.
Uh, due to a family memberhaving some, some health issues,
the franchise, uh, franchiseehad to sell and relocate
different part of the country inorder to help a family member.
So, you know, it's unfortunate,but you know, that's the stuff
that comes up that we, you know,we're approached on and say,
Hey, we have a, a few resales inthe market.
(21:42):
You know, maybe that resale,maybe they were open a few years
and you already have the team inplace.
You got revenue generated,potentially even a profit that
you can take advantage of.
And, and then you can weighthat, you know, kind of weigh
the, the pros and cons of abrand new franchise versus, uh,
an existing business.
Uh, you wanna make sure you doyour due diligence on the
franchise brand as well as theresale.
Uh, you're gonna most likely paya premium depending on how much,
(22:05):
uh, you know, income is comingin from the end profit.
We call it seller discretionaryearnings.
What is the, what is that ownerbenefiting from the business?
Net income, salaries and, andpay and everything else.
Uh, so that's something thatwill be factored in, but you're
gonna still, you know, do thedue diligence on the brand
because after that seller youend up buying, just say their
(22:27):
business, you will be.
Getting coach and supported bythe franchisor.
So they're gonna wanna make surethat the fits there.
And I mean, shoot, I've had itwhere some people looked at the,
at a resale and added a brandnew territory, and that's also
po uh, possible as well.
Uh, again, it all goes back tothe, to the match.
So when people ask me, what areyour.
You know, what, if you were me,what brand, what brands would
(22:49):
you look at?
And it's like, well, if we'vehad our second call and really
gotten into the characteristics,I'm gonna bring, you know, three
ideas to the table.
Uh, many times, um, they'regonna be very different to help
you compare and contrast abrand.
So, uh, when you approach itthat way, the overwhelm goes
away.
The options go away because, youknow, half those brands may be
(23:09):
brick and mortar of the 4,000.
Now we're down to 2000.
Uh, that's great.
You know, let's, let's startnarrowing the search.
Our team here at franchise, wehave a, a back office staff.
All they do is pre-screencompanies.
Now, this is not, you know,doing the due diligence for you,
but they're doing kind of a highlevel pre-screen to see if it's
worth working with that specificfranchise.
(23:30):
Uh, are they able to, to, togrow?
What does that team look like?
Interviewing the franchisefranchisor, the franchisee
reviewing their.
Franchise disclosure document,and again, this is just a
prescreen, you are stillresponsible for your due
diligence, but we can, we canguide you with some questions to
ask the franchisor, um,specifically, hey you know, the,
the franchisor or the, the, thefounder, CEO they're the captain
(23:53):
steering the ship.
Where's this business going?
What is the, the future of thebrand look like?
Are they adding revenue streams?
Are they adding nationalaccounts?
For the, from the franchiseevalidation side, we give sample
questions such as, if you wereto do this all over again, would
you do it?
You know, getting on those groupcalls, speaking with all
franchisees that you can onthese validations, but
(24:14):
specifically someone that's inyour situation.
Maybe it's a franchisee that isrunning it part-time.
Just like your goal to keep thejob for the first year and run
it part-time.
Great.
Talk to those people.
They, uh, I'm sure had their ownchallenges, own success stories.
You know, there's gonnapotentially be some additional
expenses if they needed ageneral manager versus an owner
(24:34):
operator, someone running itfull time.
So this is where we spend a lotof time.
You know, some people approachme and say, well, I, you know, I
want food.
I'll ask, well, why do you wantfood?
And, and usually it's a demand,right?
Everyone has to eat every day.
So then we dive into great.
A check off that we wanna highdemand business, but do all the
other boxes check off like.
The number of employees, likethe brick and mortar aspect,
(24:56):
like the investment, et cetera,et cetera.
And I've had people where theycame back and said, you know
what?
I like the idea of food.
It, it's, it's, um, I see thesignage when I go to work.
What else is out there?
I prefer less staff.
I prefer something, uh, homebase with high margins.
And we may look at things like,um, water and smoke restoration
and mitigation and industrieslike that.
(25:17):
We may look at expense reductionfor small businesses, so we'll.
You know, the, the goal there isnot to change your mind, but to
educate you and dive a littlebit deeper as to, you know, why
you want a food business.
Well, you know, really whatyou're, what you're saying is
that you're, you're looking fora business that has demand, um.
In some cases for myself, one ofmy main characteristics,
(25:38):
actually, this was the firstcharacteristics I, I I focused
on, which really, really in myopinion scaled down the list,
was I want something recessionresistant.
Uh, I bought and opened my firstfranchise in 2007.
I wanted something.
I knew the economy wasn'tlooking good.
I wanted something that could.
Do well, uh, in, in that downeconomy.
(25:59):
And we started exploringdifferent options where, not
saying we weren't affected, butthere was definitely some
opportunities that we tookadvantage of, and we talk in
more detail about that.
So, so again, you know, theinformation's out there.
You got, you know, entrepreneurmagazine, Jason Pfeiffer's, top
500 list, if you wanna look atbrands, that, that may be a good
start.
But my challenge to you is.
(26:21):
A lot of those brands may lookgreat, but they may not be
available in your market.
They may not be registered inyour state.
They may be quadruple whatyou're looking to invest.
So let's, uh, set aside 20minutes.
I set aside 20 minutes for everyintro call.
Learn about you, your situation,how we can help if decide
together for franchise is a goodfit.
(26:41):
And if it is on that secondcall, that's where the magic
happens.
That's where we figure out theideal business.
Is this, this, is this a legacycreation?
Is this something you just wannapotentially flip in, in three to
five years?
What is the ideal, uh, businesslook like?
Are you gonna be keeping yourjob and running the business on
the side?
Well, yeah, I mean that, that,that's definitely an option, but
(27:04):
not every franchisor will allowthat.
Uh, there may be ways around itif maybe the general manager
owns a percentage of thebusiness, but some will flat out
say.
We need you full time, thatfirst year to really understand
the business because that'swhere we've seen a lot of
success.
You know, we have this franchiseavatar, this avatar is, was
built over the last couple yearsof people that have done really
(27:24):
well in the system.
So, so that, that's really whatI challenge for you today is to,
is to figure out why you wantthe franchise, what does this
business look like?
And we spent a lot more timethan we did today going through
these characteristics becausepart of it's an open
conversation.
We wanna have this, this backand forth and, um.
You know, uh, and thoseconversations essentially create
(27:45):
other questions and ideas and,and open your mind up to, to
different ideas of, ofbusinesses that you could
potentially run.
So, uh, so that's my, um, youknow, when people ask what's a
franchise and, and what are thefranchises out there?
You know that that's, that's howI answer it.
To touch on what otherfranchises are out there, as I
mentioned, you got the differentbrick and mortar and you have
(28:05):
the home base service.
But if you can think of abusiness with, with 4,000
brands, and I think in 70 plusindustries there's a franchise
out there.
There's, uh, you know, thingsthat are different.
Jet jet detailing, working in,in airplane hangers.
Pet waste removal, bothresidential and commercial,
working with the HOAs and thingslike that.
Helping after a cleanup, after afire, a flood or natural
(28:29):
disaster.
Executive recruitment.
Let's see, expense reduction,business coaching, all the way
to food and, and, and health andwellness.
I, I, as I mentioned there,there's so many.
Different opportunities and youwanna make sure that you know
you wanna be, you wanna beexcited about the opportunity of
the product or service, but youalso wanna make sure it matches
(28:49):
all the characteristics.
You wanna make sure to reviewthe financials of the franchisor
and franchisee.
To make sure that fits there.
You want this to be profitableso that when you're looking at
all the f dds, the franchisedisclosure documents, and maybe
you're, you're stuck betweenthree brands and you really
wanna focus on financials, well,you'll, you'll be creating
proformas.
Uh, you'll look at the itemsfive, six, and seven to help you
(29:12):
create the initial investment inproforma range.
Uh, there may be an i there,there, there's gonna be an item
19.
Uh, so you'll get to look atfranchisee financials and
returns and, you know, really,uh, work talk with the franchise
owners to ask how their firstyear was, how profitable they
were.
Uh, that really also helps youfiguring out how many
territories you may wannaacquire or locations.
(29:33):
So a lot of exciting stuffthere.
And we could definitely talk formuch longer than this, but that,
that really lays the groundwork.
When people say, I don't knowwhere to start, this is where to
start.
If the Fran, if a franchise or abusiness, uh, you know, may be
that, that right fit for you,get your financials in order.
Let the family know.
Get everyone on board as to whatyou're doing.
(29:53):
And really start ironing out.
And you can just jot down thesecharacteristics and notes, and
then we'll go through thattogether.
And sometimes we have to maketweaks.
Uh, sometimes we have to makechanges.
Uh, sometimes you, you're laserfocused, you know exactly what
this business looks like, and wego to, to work finding the
opportunities in your market.
So, uh, I appreciate thequestions.
(30:14):
I hope this helps at least oneperson.
And if you could think ofsomeone that may benefit from
this show.
Please like, and subscribe,share this with, with one
individual that maybe, maybethey just lost their job.
One individual that's beentalking about business ownership
forever and just didn't knowwhere to start.
Uh, I just ask one small favorif you share this.
Uh, with someone I greatlyappreciate.
(30:34):
I greatly appreciate yoursupport, your comments.
You know, we grab all, we're onall social networks, TikTok,
Instagram you know, we're onYouTube and I'd gather all that
information, that informationand comments we try to respond
to all engage and utilize thatfeedback in the comments for
these future episodes.
So thanks again, uh, everyonefor your support.
(30:55):
This was fun.
Definitely have lots more, alot, lot more topics to discuss.
Open to your comments and if,uh, you're ready to have that
conversation and dive right in,go to the website, gigi the
franchise guide.com/.
Calendar.
You can also book a call topright hand side of the corner,
uh, of the, uh, website.
Uh, we'll give you a fewquestions, kind of the, what we
(31:16):
talked about, figuring out ifyou're a good fit for a
franchise, and you'll be given,uh, a spoiler alert may, maybe
this is a surprise, but we'llgive you a, a copy of our book.
We'll email right in your inboxand you'll get to book a 20
minute call with me.
So looking forward to it.
Again, appreciate everyone'ssupport.
Can't wait to to, to get thecomments on this one.
And if you have an idea, uh, fora future episode or you wanna
(31:39):
come on the show or have a guestrecommendation, feel free to
share.
Uh, again, I, I reallyappreciate everything and
looking forward to, uh, chattingsoon.
Take care everyone.
See ya.
Thanks for tuning in if you wantto learn how to make the
transition from corporate toowning your franchise.
Join Giuseppe on the nextepisode.
You can also follow on allsocial media platforms and
(31:59):
achieve financial and timefreedom today.
a franchise is a business on training
(00:03):
wheels.
A franchise is a business where,uh, someone else has figured out
the best way of doing business.
Not all franchises, and I willrepeat this, not all franchises
are created equally.
the goal I think in, in myopinion, is finding the right
match.
And once you find the rightmatch, I believe that business
is gonna be much moresustainable.
(00:23):
Welcome to the Franchise FreedomPodcast, where you can escape
the corporate trap throughfranchise ownership.
Here's your host, Giuseppe gr,the franchise guide.
Welcome to the Franchise Freedom Podcast.
I'm your host, GiuseppeGrammatical, your franchise
guide, the show where we helpcorporate executives experience
(00:44):
time and financial freedom viafranchising.
Thanks for joining us today, uh,for today's conversation and
show.
Wanted to discuss, uh, topics Iget on a daily basis, and I'm
sure the, uh, individuals askingthe questions aren't the only
ones that have, uh.
You know that, that thesespecific questions, so wanted to
share that on a show today, andhopefully I can, uh, inspire and
(01:08):
answer the question around, uh,franchising and franchise
ownership.
So, uh, the question was aroundessentially, you know, what are
the Fran, what is the franchiseand, and what are the
franchisees out there?
And, uh, so, so part one to thatquestion.
And I talk about this quitequite a bit, is that a franchise
is a business on trainingwheels.
(01:29):
A franchise is a business where,uh, someone else has figured out
the best way of doing business.
They have that business plan inplace they've executed on the
business, and essentiallythey're looking to grow their
business by duplicating it andhaving individual owners around
the country.
Grow that brand.
And just because there's afranchise out there doesn't mean
(01:51):
it's available in your state.
Some brands grow regionally.
You know, you see brands on theeast coast as well as, uh, just
on the West Coast, and maybethat's their.
Uh, full intention of growth andsometimes that's where they're
testing the markets and theneventually growing later.
In other cases, uh, we talkedabout this on a previous
episode, are registration statesand maybe that brand isn't
(02:13):
available yet in that specificstate.
Maybe they are relatively newand they're trying to get more
of a track record in order toregister in that specific state.
Certain registration states.
I get a lot of calls from peoplein Washington, uh, as well as
California, uh, WashingtonState, and California.
So.
You know, so that's a little bitabout, uh, franchising.
Don't look at franchisingnecessarily as an industry.
(02:35):
Um, you have franchises in, um,you know, uh, haircuts.
Uh, you have Fran franchisesaround fast food and things like
that.
That's the industry fast food.
And then you look at thefranchises within because
franchising, I would say yes,there's a lot of similar things
going on and benefits that Italked about a couple.
Episodes ago, uh, from, uh, keytakeaways from our Cincinnati
(02:58):
conference.
Uh, so definitely encourage youto, to check that out.
A couple, a couple episodes ago.
Now, when it comes to whatfranchises are out there there
are over 4,000 franchisecompanies in the US alone.
And, uh, it's good to know whatis out there.
And, uh, you know.
Entrepreneur Magazine, uh, JasonPfeiffer, for example the editor
(03:21):
in Chief of EntrepreneurMagazine, who I had on the show.
At the end of last year did areally good job just talking
about his experience infranchising and that they have
this, uh, year end or actuallybeginning of the year edition
where they talk about the top500 brands and that they break
it down by industry.
So that could be a good startingpoint.
(03:42):
But, you know, my, my, the pointof my conversation is that with
the internet, there's no lack ofinformation.
There are a list of brands outthere, but ultimately.
My whole thing and my, my goalfor today is really to challenge
your way of, of thinking the,your, your challenge your way
and really help you in figuringout and, and changing the
mindset of, of figuring out howto find the right brand for you.
(04:06):
Because one thing that I try to.
Hit home on, uh, on a lot ofthese, uh, conversations is that
just because your friend, familymember, or someone you knew was
successful with the franchisedoes not mean necessary that you
are gonna be successful withthat franchise still has the
same system and support, but itmay not be a good match based
off your personality, uh, maynot be a good match, uh, maybe
(04:28):
based off of where you'relocated in the country.
The demographics and things likethat you have to take into
consideration.
So a big part of today is thatyou can definitely find the list
of brands out there.
Some people have interest incertain industries, as I
mentioned, haircutting and fastfood and, and things like that.
Uh, but I wanted you to changeyour approach into figuring out.
(04:48):
You know, what are the franchisemodels?
Big, big change there inmindset, franchise models, uh,
that may be a good fit.
And where do we start?
So, you know, we start as we, aswe do all conversations, let's
figure out if a franchise may bea good fit.
And really it's around havingaccess to capital.
(05:09):
I always say at least 50,000liquidity, about a hundred
thousand net worth is a, is agood starting point.
Uh, we'll get into morespecifics.
You know, being able to make adecision within six months on a
brand, not opening, but signingan agreement.
I talk about that quite a bitbecause why explore a brand
when, you know, it's kinda likelooking at a home.
You, you find the home you likeand say, okay, I'll be back in a
(05:29):
year to buy it.
Well, that territory may not beavailable.
You know, specifically or that,that specific location in a
year.
So I would say start, start thedue diligence when you have a
goal of making a decision in sixmonths or less.
And you're okay followingsystems because just like we
talk about E Myth Revisited byMichael Gerber, the whole idea
of systems, that's exactly whatyou're getting with the
(05:51):
franchise.
You're getting systems and, uh,the intention is to follow the
main system, to follow themarketing and everything that
franchisor is providing you.
So.
We get past, yes.
Okay.
Franchising may be a good fit.
Uh, I'm not looking to reinventthe wheel.
You know, I, going back to your,wanna, wanna make sure we have a
strong enough, why, why are youdoing this?
(06:12):
What are you looking to, uh, tocreate from this?
And then we get into the kindof, the, the meat of this call
is the ideal business.
You know, how do we, how do wefind the ideal business?
And again, you know.
In the same industry, you'regonna find multiple brands in
mosquito spraying and roofinghaircuts, fast food, you know,
(06:32):
gyms and things like that.
Not all franchises, and I willrepeat this, not all franchises
are created equally.
Every brand, you know, they maybe in a similar industry giving
the customer or client the sameservice, providing the same
service, but ultimately they maybe run differently.
Uh, these are characteristics.
Uh, one franchise, a in themosquito spraying space may have
(06:55):
you.
Running the business full-timein spring the backyards of
people's homes and the otherone, uh, allows you running it
part-time where you'reoverseeing the marketing, the
KPIs, and, and just the, thesystems in place.
So, you know, going back tothese, these characteristics
that I talk about, I just talkabout this all the time.
It's so crucial because having aclear idea, even if you've never
(07:19):
owned the business before, andthis is, this is where I can
help getting an idea of what.
You know, an idea of what thatbusiness may look like from
these characteristics we'regonna talk about really helps
you to scale down the brands,uh, you know, that, that, that
are gonna be available in yourmarket.
So let's, let's go through someexamples of, of things to think
(07:39):
about and then we can go backand, and revisit and see where
the, the match is.
So, you know, a big part of thisis where you are located.
Location, you know, the, thespecifically, uh, or general
area.
So you may live in Chicago andmaybe it's one of the suburbs in
Chicago, but you have thatgeneral area.
Now a brick and mortar business,uh, you know, specifically,
(08:01):
maybe it's a standalone buildingor in a shopping center, uh, may
say, you know, we have room forthree locations, so you're not
really figuring out the exactspot.
A third party will come in andhelp you there, but we wanna
figure out the, the Chicago areaand, uh, or the, or the suburbs,
anything beyond that.
Anything beyond the center ofChicago going back in hours is,
is too far out.
(08:22):
That is one way to really scaledown your business because
sometimes we see ads, especiallyif you're doing research
nowadays, and you may getretargeted, an ad may pop up and
it sounds great.
Obviously it's an ad, right?
They're, they're gonna make itappealing, but we wanna make
sure that it's in a market thatyou're comfortable with, you're
not driving two hours to get towork at a location or what have
(08:45):
you.
So location, I think is, is, isa big one, and it would really,
really help you scale back.
You know, the, the number ofbrands because, uh, first off,
it has to be registered in yourstate of Illinois.
Uh, secondly, it needs to beavailable in your market.
So, uh, and all, you know, thisis something to, to really
consider and, um, I encourageyou to, to really think, Hey,
(09:06):
are we, are we he, are westaying here for the long run or
are we thinking of, of moving?
That's a great place to start.
So if you are thinking ofmoving, uh, or have dual
residency or, or thinking ofeventually moving in a year.
Maybe look at, you know, where,where you'll eventually move and
see if it works within thetimeframes.
Second piece of this is money,money, money, money.
(09:27):
We need to be able to fund thisfranchise and not, you know,
there, there there's this wholeidea of, you know, the money you
capital you have, but you don'twanna overextend yourself.
Uh, so I encourage everyone tolook at their financial
situation.
Break down, you know, you knowall your savings accounts,
checking accounts put all yourassets together on the left side
(09:50):
of a piece of paper and all yourliability.
So assets are anything you own.
You know, IRAs, real estate.
And that could be the, andthat's gonna be the, the assets
gonna be the value of the home.
Approximate.
And then there's a liability.
What's the mortgage on there?
Do you have any student loans?
Credit card debt auto loans.
Uh, maybe you have a secondproperty.
(10:11):
An investment property that hasa mortgage on it, you know,
write that stuff down and youstart figuring out net worth.
So assets.
Minus li uh, liabilities is yournet worth.
Uh, and then you're figuring outyour liquidity.
What a, you know, what access doyou have to capital your
checking, savings, stockaccounts, and things like that.
Number, and, and it provides tworeasons.
Number one is the franchisorwill have liquidity and net
(10:33):
worth requirements.
Uh, number two, it, it's good tohave those numbers because I
always encourage everyone, ifyou are.
Leaving your job to run thisbusiness full time.
You wanna make sure to have somecash reserves for the business
and personal expense.
You know, everyone's situationis different, and this is where
we do a little bit of a, of adeeper dive.
But if you're, if there'ssomeone else in the home, maybe
(10:54):
it's your spouse that is workingand their income is covering the
expenses, great.
You wanna have a little bit of abuffer there and make sure you
have enough to fund the businessand, and some reserves aside.
In the event, the business takemaybe takes a little bit longer
to get up and running.
So I always encourage you there,but I, I also encourage everyone
to speak with a funding company.
We work, uh, closely with acompany called Benetrends and
(11:17):
they will do a full evaluationwith you at no cost, looking at
your different options such asyou know, uh, can I use a
retirement rollover?
An SBA loan, which you talkquite a bit about, or even a
home equity line of credit.
Uh, they'll go through yourdifferent options, some things
to, to think about and theydon't provide, you know, every
product, they'll provideretirement rollovers and SBAs
(11:40):
and things like that.
Even un, you know, assistingwith unsecured loans.
Uh, but if it's something like ahome equity line of credit, uh,
they'll encourage you to speakwith your bank and see kind of
what the rates are, you know,what their requirements are and
things like that.
So, uh, financials, if you comeback and, you know, the numbers,
a 50,000 liquid, a hundredthousand net worth, and the SBA
(12:01):
pre-app approves you for a loanup to 200,000, maybe we stay
within that and that obviouslyalso reduces, right?
Kind of narrows the search down.
Uh, for the first business, italso helps you figure out, okay,
you know, if we're, you know,looking at 200,000, is that
gonna be enough for a brick andmortar type of business?
Or is should we stay more in thehome-based service, uh, kind of
(12:25):
area or industry?
Uh, so thi things to thinkabout, getting a full financial
picture, looking at all theoptions.
Um, these options will also helpyou figure out the number of
locations, the number ofterritories that you're looking
to explore.
Uh, so financials are gonna bebig, and I encourage everyone
after having our first call andsending back the questionnaire,
we, we always send anintroductory email to Beres to
(12:48):
do a full analysis of, of kindof your financials.
Now we look at, you know, thevenue.
The venue also is a big one herebecause.
This is where I kind of splitthe franchises in half on one
side, uh, on the left side, youhave home-based service
businesses.
What is that?
Well, it's something that reallycould be a business that could
be run from home.
(13:08):
Maybe you're going to abusiness, maybe you're going to
a homeowner and providing aservice.
Business coaching.
It may be it's expensereduction.
It's, uh, water and smokemitigation.
It could be mosquito sprayingroofing.
Uh, essentially you don't needan office.
Maybe you get one down the, uh,down the low, uh, down the road.
Uh, a flex space and office witha, with a warehouse.
(13:29):
But, um, essentially theadvantage here is number one,
you'll be up and running in oneto three months, uh, after
signing the franchise agreement.
And that's gonna be dependenton.
Your availability, the nexttraining dates and what is
needed for the business.
Are there trucks and equipmentneeded?
Do you have to get vehicleswrapped?
If not, you know, you can getup, you can get up and running
(13:50):
sooner than later.
But these businesses are notonly up and running pretty
quickly.
Uh, the investment's gonna beless, I would say a good, uh.
Area is about a hundred to250,000 depending on the
business, the requirements.
Is it a, you know, W2 or 10 99labor model?
There's so many differentvariables, but, um, that gets
you thinking about, hey, youknow, I, I, you know, I do wanna
(14:13):
get up and running sooner thanlater.
I may wanna look at a home-basedbusiness to open up potential
office outside the home youknow, later on.
Also the idea of that lowerinvestment works works better
for me.
Uh, on the flip side there,there's brick and mortar.
And with brick and mortar, theseare essentially, you need a
location.
Customers are coming to you,right?
It's a different, completelydifferent strategy.
(14:34):
You do the marketing and, andthe customer comes to you.
So these could be gyms it couldbe food prep, uh, different
venues around that, health andwellness, cryotherapy.
Uh, IV nutrition, uh, haircuts,uh, facials, pedicures, tanning,
waxing, you name it, falls inthe space.
And these businesses, becausethey are a brick and mortar,
(14:57):
that franchisor will usuallyprovide a third party for a fee
and, and find that rightlocation for you.
Because there's a location andthere's a landlord, it's gonna
increase the time to get open.
I would say six to 18 monthsdepending on the specific
location.
Working with the landlord andhow, how, um, how simple, you
know, what's, what's, uh, what'sthe build out look like
(15:19):
specifically for that space.
Maybe you have a gym franchiseand there was already a gym in
that space, so maybe a, a, aquicker build out time.
You know, permits and all that.
So it really depends on, uh, thelocation where you fall in the
country.
3, 3 50 thou, three 300 to350,000 would be the average.
Uh, could it be less?
Yes.
Could it be more?
Absolutely.
(15:39):
But those are just some, somegeneral ranges.
Uh, and then you get into thestandalone world where you're
getting into trampoline parksand, and certain stretch salon
suites and things like that.
And now you're getting into.
A much more robust, larger buildout, standalone building.
There's a lot more costsinvolved.
You don't have to own thebuilding.
Some people do.
(15:59):
Most people will lease.
Uh, you're getting into a sevenfigure investment and I would
say one to two years plus to, toget open.
So they, they all have to fallwithin your comfort range.
And sometimes that alone helpsyou scale back and say, you know
what?
For my first business, I want tobe up, up and running sooner
than later, and people go theservice route.
Other people are okay, um, youknow, opening up at a later
(16:21):
date.
But my job is not to tell youwhat's better or worse.
My job is to tell you these arethe things to expect when
looking at these businesses.
So we call it the venue, adifferent way of doing business
that the clients and customersare coming to you.
A bigger investment you know,it's gonna take longer to get up
and running.
And those are things toconsider, especially if, uh, you
were recently laid off and maybeyou need to generate income
(16:44):
sooner than later.
Maybe the, the, the home-basedservice business may be a better
match.
So that is anothercharacteristic that we, we look
at.
And by the way, there is zerocorrelation between the, the
investment and the return.
Uh, the goal I think in, in myopinion, is finding the right
match.
And once you find the rightmatch, I believe that business
is gonna be much moresustainable.
(17:06):
You'll do, you'll do much betterbecause you enjoy the business.
And it will excel on your skillsets, which is the next
characteristic.
Um, and that characteristic isreally what your role as the
franchisor, excuse me,franchisee is gonna be in the
business.
Uh, so the franchisee's role,and usually the franchisor is
gonna look for thattransferrable skillset.
So if you are on Wall Street,like myself.
(17:28):
Do you need investment strategyand financial planning to be
able to run the business?
No, but what that franchisor maybe looking at was someone that
could network and be, become themayor of the town.
Someone that was, uh, is, isgreat at management, which we
see a lot in cleaning withlarger number of staff.
What is that skill set that youbring to the table?
(17:50):
You know, what is the averageday in a, in, in a life look
like?
Now, keep in mind, day one, theaverage day in a life is gonna
look much, much different thanday 365, a year later.
So day one is getting every, youknow, learning the business,
getting trained, getting up andrunning, finding the right
staff.
And then, uh, you know, afterthat, that first year.
Hopefully key staff is in place.
(18:12):
Revenue's been generated,hopefully some profit's been
generated as well, where you cankind of take a step back to see,
okay, these are the role, thisis the role I wanna take in the
business.
These are the areas I reallyenjoy and I'm gonna take that
role and, and I'm gonna hire outfor the rest.
So, uh, role is gonna be a majorpart of it.
Again, another characteristic,helping you scale down in the
(18:32):
business.
And then there's, you know,there there's other
characteristics and sometimes.
There is no preference,especially if you've never owned
the business before.
Uh, such as, uh, what do youremployees look like?
Kind of a crazy question.
And, um, what that means isessentially are they W2
employees where, you know,you're paying them an hourly
(18:53):
wage or salary, training them onevery aspect of the business, or
are they a 10 99 contractorwhere.
You're utilizing a roofer toreplace a roof, an existing
roofer where they're bringingtheir own equipment and trucks
and things like that.
So definitely differences, uh,and pros and cons between a W2
and a contractor.
And we dive into thosedifferences.
What does that look like?
(19:14):
Well, a contractor, uh, you'regonna have a lower investment
simply because, um, you know.
You're not paying, typically thecontractor until JA job is, uh,
is awarded, completed, and paidfor is when the contractor's
getting paid.
And, uh, those are somebenefits, keeping the investment
lower and you know exactly, youknow, what the, the contractor's
(19:34):
getting paid and what yourmargin is on the business.
So another, anothercharacteristic of the business
goals of the business.
You know, are you looking to,you know, grow the business as
fast as possible and sell in acouple years, 2, 3, 4, uh, five
years?
Or is it to create a long-termlegacy?
Uh, there are gonna be somebrands that will scale a little
(19:55):
bit quicker.
Others will have more of amembership model where you're
slowly building this, this baseof clients that become this
annuity, right?
This revenue stream.
You know, you start off withmaybe you gain 10 customers a
month.
At the end of the year, you haveover a hundred customers that
are paying you to that offeringa service, like maybe a mosquito
spraying or pest control type ofbusiness where you're building
(20:16):
and you're not, you know,starting at zero every month.
You know that you have theserevenue, that revenue stream,
that annuity is what I like tocall it.
So.
When you approach it that way,it's a completely different mind
shift.
But when you break thesecharacteristics, like, what's my
comfortable investment?
One other thing I didn't talkabout in the investment also was
the cash injection, right?
I can get approved for 200,000,but what, what's my injection?
(20:38):
Well, it's gonna be just say20%.
So I'm okay putting$40,000, uh,down in order to get the, uh,
the loan to, to obtain the loan.
My role in the business, whereI'm located, my employees, what
they, what, what specificallythey look like.
Do I, you know, as far as acontractor, W2, where am I
located?
Uh, do I prefer that brick andmortar or something I can run
(21:01):
from home?
Once you.
And, and, you know, and, andsometimes you may be indifferent
on these, but the goal is reallyto, to nail them and have some
preferences there.
Then we can go to work to seewhat brands are available in
your market.
Even just for fun, let's checkto see if there are any resales
available in your market.
There may be someone that maybethey're retiring you know,
something happened in lifethat's forcing them to sell.
(21:22):
We just had a, uh, we were justapproached with the a resale
that.
Uh, due to a family memberhaving some, some health issues,
the franchise, uh, franchiseehad to sell and relocate
different part of the country inorder to help a family member.
So, you know, it's unfortunate,but you know, that's the stuff
that comes up that we, you know,we're approached on and say,
Hey, we have a, a few resales inthe market.
(21:42):
You know, maybe that resale,maybe they were open a few years
and you already have the team inplace.
You got revenue generated,potentially even a profit that
you can take advantage of.
And, and then you can weighthat, you know, kind of weigh
the, the pros and cons of abrand new franchise versus, uh,
an existing business.
Uh, you wanna make sure you doyour due diligence on the
franchise brand as well as theresale.
Uh, you're gonna most likely paya premium depending on how much,
(22:05):
uh, you know, income is comingin from the end profit.
We call it seller discretionaryearnings.
What is the, what is that ownerbenefiting from the business?
Net income, salaries and, andpay and everything else.
Uh, so that's something thatwill be factored in, but you're
gonna still, you know, do thedue diligence on the brand
because after that seller youend up buying, just say their
(22:27):
business, you will be.
Getting coach and supported bythe franchisor.
So they're gonna wanna make surethat the fits there.
And I mean, shoot, I've had itwhere some people looked at the,
at a resale and added a brandnew territory, and that's also
po uh, possible as well.
Uh, again, it all goes back tothe, to the match.
So when people ask me, what areyour.
You know, what, if you were me,what brand, what brands would
(22:49):
you look at?
And it's like, well, if we'vehad our second call and really
gotten into the characteristics,I'm gonna bring, you know, three
ideas to the table.
Uh, many times, um, they'regonna be very different to help
you compare and contrast abrand.
So, uh, when you approach itthat way, the overwhelm goes
away.
The options go away because, youknow, half those brands may be
(23:09):
brick and mortar of the 4,000.
Now we're down to 2000.
Uh, that's great.
You know, let's, let's startnarrowing the search.
Our team here at franchise, wehave a, a back office staff.
All they do is pre-screencompanies.
Now, this is not, you know,doing the due diligence for you,
but they're doing kind of a highlevel pre-screen to see if it's
worth working with that specificfranchise.
(23:30):
Uh, are they able to, to, togrow?
What does that team look like?
Interviewing the franchisefranchisor, the franchisee
reviewing their.
Franchise disclosure document,and again, this is just a
prescreen, you are stillresponsible for your due
diligence, but we can, we canguide you with some questions to
ask the franchisor, um,specifically, hey you know, the,
the franchisor or the, the, thefounder, CEO they're the captain
(23:53):
steering the ship.
Where's this business going?
What is the, the future of thebrand look like?
Are they adding revenue streams?
Are they adding nationalaccounts?
For the, from the franchiseevalidation side, we give sample
questions such as, if you wereto do this all over again, would
you do it?
You know, getting on those groupcalls, speaking with all
franchisees that you can onthese validations, but
(24:14):
specifically someone that's inyour situation.
Maybe it's a franchisee that isrunning it part-time.
Just like your goal to keep thejob for the first year and run
it part-time.
Great.
Talk to those people.
They, uh, I'm sure had their ownchallenges, own success stories.
You know, there's gonnapotentially be some additional
expenses if they needed ageneral manager versus an owner
(24:34):
operator, someone running itfull time.
So this is where we spend a lotof time.
You know, some people approachme and say, well, I, you know, I
want food.
I'll ask, well, why do you wantfood?
And, and usually it's a demand,right?
Everyone has to eat every day.
So then we dive into great.
A check off that we wanna highdemand business, but do all the
other boxes check off like.
The number of employees, likethe brick and mortar aspect,
(24:56):
like the investment, et cetera,et cetera.
And I've had people where theycame back and said, you know
what?
I like the idea of food.
It, it's, it's, um, I see thesignage when I go to work.
What else is out there?
I prefer less staff.
I prefer something, uh, homebase with high margins.
And we may look at things like,um, water and smoke restoration
and mitigation and industrieslike that.
(25:17):
We may look at expense reductionfor small businesses, so we'll.
You know, the, the goal there isnot to change your mind, but to
educate you and dive a littlebit deeper as to, you know, why
you want a food business.
Well, you know, really whatyou're, what you're saying is
that you're, you're looking fora business that has demand, um.
In some cases for myself, one ofmy main characteristics,
(25:38):
actually, this was the firstcharacteristics I, I I focused
on, which really, really in myopinion scaled down the list,
was I want something recessionresistant.
Uh, I bought and opened my firstfranchise in 2007.
I wanted something.
I knew the economy wasn'tlooking good.
I wanted something that could.
Do well, uh, in, in that downeconomy.
(25:59):
And we started exploringdifferent options where, not
saying we weren't affected, butthere was definitely some
opportunities that we tookadvantage of, and we talk in
more detail about that.
So, so again, you know, theinformation's out there.
You got, you know, entrepreneurmagazine, Jason Pfeiffer's, top
500 list, if you wanna look atbrands, that, that may be a good
start.
But my challenge to you is.
(26:21):
A lot of those brands may lookgreat, but they may not be
available in your market.
They may not be registered inyour state.
They may be quadruple whatyou're looking to invest.
So let's, uh, set aside 20minutes.
I set aside 20 minutes for everyintro call.
Learn about you, your situation,how we can help if decide
together for franchise is a goodfit.
(26:41):
And if it is on that secondcall, that's where the magic
happens.
That's where we figure out theideal business.
Is this, this, is this a legacycreation?
Is this something you just wannapotentially flip in, in three to
five years?
What is the ideal, uh, businesslook like?
Are you gonna be keeping yourjob and running the business on
the side?
Well, yeah, I mean that, that,that's definitely an option, but
(27:04):
not every franchisor will allowthat.
Uh, there may be ways around itif maybe the general manager
owns a percentage of thebusiness, but some will flat out
say.
We need you full time, thatfirst year to really understand
the business because that'swhere we've seen a lot of
success.
You know, we have this franchiseavatar, this avatar is, was
built over the last couple yearsof people that have done really
(27:24):
well in the system.
So, so that, that's really whatI challenge for you today is to,
is to figure out why you wantthe franchise, what does this
business look like?
And we spent a lot more timethan we did today going through
these characteristics becausepart of it's an open
conversation.
We wanna have this, this backand forth and, um.
You know, uh, and thoseconversations essentially create
(27:45):
other questions and ideas and,and open your mind up to, to
different ideas of, ofbusinesses that you could
potentially run.
So, uh, so that's my, um, youknow, when people ask what's a
franchise and, and what are thefranchises out there?
You know that that's, that's howI answer it.
To touch on what otherfranchises are out there, as I
mentioned, you got the differentbrick and mortar and you have
(28:05):
the home base service.
But if you can think of abusiness with, with 4,000
brands, and I think in 70 plusindustries there's a franchise
out there.
There's, uh, you know, thingsthat are different.
Jet jet detailing, working in,in airplane hangers.
Pet waste removal, bothresidential and commercial,
working with the HOAs and thingslike that.
Helping after a cleanup, after afire, a flood or natural
(28:29):
disaster.
Executive recruitment.
Let's see, expense reduction,business coaching, all the way
to food and, and, and health andwellness.
I, I, as I mentioned there,there's so many.
Different opportunities and youwanna make sure that you know
you wanna be, you wanna beexcited about the opportunity of
the product or service, but youalso wanna make sure it matches
(28:49):
all the characteristics.
You wanna make sure to reviewthe financials of the franchisor
and franchisee.
To make sure that fits there.
You want this to be profitableso that when you're looking at
all the f dds, the franchisedisclosure documents, and maybe
you're, you're stuck betweenthree brands and you really
wanna focus on financials, well,you'll, you'll be creating
proformas.
Uh, you'll look at the itemsfive, six, and seven to help you
(29:12):
create the initial investment inproforma range.
Uh, there may be an i there,there, there's gonna be an item
19.
Uh, so you'll get to look atfranchisee financials and
returns and, you know, really,uh, work talk with the franchise
owners to ask how their firstyear was, how profitable they
were.
Uh, that really also helps youfiguring out how many
territories you may wannaacquire or locations.
(29:33):
So a lot of exciting stuffthere.
And we could definitely talk formuch longer than this, but that,
that really lays the groundwork.
When people say, I don't knowwhere to start, this is where to
start.
If the Fran, if a franchise or abusiness, uh, you know, may be
that, that right fit for you,get your financials in order.
Let the family know.
Get everyone on board as to whatyou're doing.
(29:53):
And really start ironing out.
And you can just jot down thesecharacteristics and notes, and
then we'll go through thattogether.
And sometimes we have to maketweaks.
Uh, sometimes we have to makechanges.
Uh, sometimes you, you're laserfocused, you know exactly what
this business looks like, and wego to, to work finding the
opportunities in your market.
So, uh, I appreciate thequestions.
(30:14):
I hope this helps at least oneperson.
And if you could think ofsomeone that may benefit from
this show.
Please like, and subscribe,share this with, with one
individual that maybe, maybethey just lost their job.
One individual that's beentalking about business ownership
forever and just didn't knowwhere to start.
Uh, I just ask one small favorif you share this.
Uh, with someone I greatlyappreciate.
(30:34):
I greatly appreciate yoursupport, your comments.
You know, we grab all, we're onall social networks, TikTok,
Instagram you know, we're onYouTube and I'd gather all that
information, that informationand comments we try to respond
to all engage and utilize thatfeedback in the comments for
these future episodes.
So thanks again, uh, everyonefor your support.
(30:55):
This was fun.
Definitely have lots more, alot, lot more topics to discuss.
Open to your comments and if,uh, you're ready to have that
conversation and dive right in,go to the website, gigi the
franchise guide.com/.
Calendar.
You can also book a call topright hand side of the corner,
uh, of the, uh, website.
Uh, we'll give you a fewquestions, kind of the, what we
(31:16):
talked about, figuring out ifyou're a good fit for a
franchise, and you'll be given,uh, a spoiler alert may, maybe
this is a surprise, but we'llgive you a, a copy of our book.
We'll email right in your inboxand you'll get to book a 20
minute call with me.
So looking forward to it.
Again, appreciate everyone'ssupport.
Can't wait to to, to get thecomments on this one.
And if you have an idea, uh, fora future episode or you wanna
(31:39):
come on the show or have a guestrecommendation, feel free to
share.
Uh, again, I, I reallyappreciate everything and
looking forward to, uh, chattingsoon.
Take care everyone.
See ya.
Thanks for tuning in if you wantto learn how to make the
transition from corporate toowning your franchise.
Join Giuseppe on the nextepisode.
You can also follow on allsocial media platforms and
(31:59):
achieve financial and timefreedom today.
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