← Unemployable with Jeff Dudan
Unemployable with Jeff Dudan
From Risk to ROI: How to Pick the Right Franchise (and Lead It) Franchise Friday's with Jeff Dudan
00:19:34
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- [00:00]
A
Hey, everybody. Welcome back to Franchise Fridays on the unemployable podcast with Jeff Duden. And today we've got a special treat. We've got Michael Wagner, the president of Roof Scientist. Been in the franchise industry for a long time, going to talk to you about some things to consider when looking at a franchise. Welcome, Michael.
- [00:19]
B
Thank you very much, Jeff. I'm excited to be here.
- [00:25]
A
Yeah, well, you work here, so we come here all the time, but look, that's fine. So, you know, just as an opener, will you please tell people who you are and just do a quick introduction of your background.
- [00:37]
B
Great. Yeah. Once again, Michael Wagner. I'm fortunate to be the president of Roof Scientist and part of the Homefront Brands family, the newest brand amongst the family here. I've been in franchising for over 10 years, was fortunate to be part of another brand for a nine year stint, including starting that up. And I love franchising. I'm excited to be here.
- [00:59]
A
Awesome. Can you share a little bit about your role at Homefront Brands specifically?
- [01:04]
B
So my job when I came here in October was to help start and build the fifth brand with Homefront Brands, which is Roof Scientist. We had made an acquisition of a small organization up in Milwaukee, Wisconsin that we wanted to franchise and show the world. And I was fortunate to contact you at the right time and to come here to begin that journey with Roof Scientist.
- [01:29]
A
You have a long history working with franchise owners, building pool scouts for nine years. What gets you most excited about working with brand new first time franchise owners?
- [01:41]
B
First of all, it's such an exciting and yet scary endeavor for a franchisee to take that risk and invest in themselves. Most people come from backgrounds where they've worked in the corporate world or they've been in the military, or they've done something where they're working for others. So for them to roll dice on themselves is incredible to watch and for them to build something from what they perceive as nothing. Although we know we've established all the systems and the processes and the brand and the marketing and the way they do things, the standard operating procedures, they don't know that when they get in, but to watch them embrace that and become part of something which is what I like to call the greater good, which is franchising and a brand development, it's really exciting. And then as you see them build a business that's making money and ultimately they're building long term wealth, flexibility and life balance, which is what everybody wants, that's just super exciting to be part of.
- [02:42]
A
Talk more about that more about the problems people are trying to solve in their life through a business, through franchising.
- [02:51]
B
So once again, it's taking that risk on themselves and creating ultimately long term wealth. And I think that's one component. And one of the things you often talk about is an exit and a strategy to have an exit. And a lot of people don't think about that when they get into business. What are they ultimately building? And sometimes that exit might be passing on a business to their children, or it might be selling the business, or it might just be keeping that business growing and thriving. But the long term thought process of getting into business is something we as franchisors help franchisees think about. And we help them think about following a model, staying consistent to a brand. But we're always as franchisors looking for better ways to do things. And often those better ideas come from franchisees. So part of our job as a franchisor is to be a great listener and that's fun to get people engaged and have them wanting to build that greater good of a brand.
- [03:48]
A
Yeah. As I think about franchise owners and the problems they're solving, like you said, creating wealth. When you have a job and you're employed, you're trading time for dollars and the company is generally accruing the equity in the brand, you might participate in some way and that's fair. But also freedom also maybe challenging themselves to build something for the very first time. I often make the observation that think about the people around you who you really envy their life. You know, they go places, they travel, they have great experiences, they're around great people. That freedom oftentimes is affiliated with them. Owning a business and going and doing those things is somehow connected to the business. So once you have a business and you're looking to grow that business, there's all kinds of opportunities to meet new people, to go improve yourself as an entrepreneur through training, go to events, go to conferences. So it's really an opportunity to kind of round you out as a human, as a person, and ultimately, you know, cut your teeth as an entrepreneur. Franchising is a great way to really build your skill sets, your capabilities, and also create freedom and security for your family at the same time. When you think about the franchise owners that you've worked with in the past, have you identified what an ideal franchise candidate might look like?
- [05:14]
B
So I think there's a couple things. First of all, you have to have the initiative to take the risk.
- [05:19]
A
Right?
- [05:20]
B
And I think getting out of your comfort zone is, is part of that, taking that risk of investing. I've always said with franchising, when we talk to franchisees and we look at them in the eye, we've in many cases they've built up a life savings, they built up a nest egg, they built up a bag of money and it might be borrowed money in some cases too. And they've pushed that money across the table to us and they've asked us to trust them and them to trust us, to help them build something that builds that long term wealth, the flex. So they got to be willing to take the risk on themselves. And that's step one. Step two, honestly, is the willingness to follow a model. And so while that entrepreneurial risk taking happens, in franchising, you're following a playbook, you're following a model and you're executing consistently on how we as the franchisor establish the standard operating procedure, the brand guidelines. And you have to be willing to operate in that, in the guardrail of the franchise system. Whereas if you're a true entrepreneur, you're starting everything from zero and you're going to make lots of mistakes in franchising. Most of the systems that we incorporate in our business model are tested, they're validated before you come on and before you take the risk of failing. We've gone through those processes and have experience in doing that. Really, it's about willing to take that risk, willing to follow the model. And then one of the things that's like for me, immeasurable is the willingness of a franchisee to be the owner, to be the face of their business. When I've seen successful franchisees, they're willing to put themselves out there, to be in their communities and be leaders in their communities of their business. So being visible, don't hide behind something literally and figuratively wear the shirt of your business in your communities. Yeah.
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A
Be the face of the brand and be proud of it. Yeah, yeah. What are some common misconceptions people might have about franchising?
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B
So I think, you know, first of all, what kinds of businesses are in franchising? I think when most people think of franchising, they think of fast food franchises and that's what they're used to and they're accustomed to. So I think the first thing is just the breadth of industries that are out there that are great franchise opportunities. Another thing that I like to call, and I my former business that I was involved in was the pool business. And I used to say it's not a sexy business, but it's one that is required, that's, you know, recession resistant. And certainly roof scientists is exactly that. And I wouldn't describe it as a sexy business, but there are things that are super sexy about it. When you step back and you look at the unit economics of the business model, number one, it's recession resistant. Number two, it's a required service. You can't not do anything if your roof's leaking and you got troubles with it, of course. And number three, it's constantly in demand, but it's also a high margin business. So those are things that are sexy about the business. Sometimes people get enamored and excited about things they love. Maybe it's a fitness concept or a beauty concept because they're super passionate about that, which that is great. But ultimately looking at the sexiest part of a business being, are you going to make money at it? Is it something you can be passionate about doing? And you might have to think outside of the box to make that second comment worthwhile.
- [08:55]
A
I have learned in my life that sometimes you need to subtract things in order to achieve your goals. Meaning you might have habits or thoughts or head trash limiting beliefs that are getting in your way from achieving what you want to achieve. And you have to really look at that and take that away. First time business owners that come to franchising and it's the first time that they've actually owned the business owner hat and put it on, what are some of the mindsets that they might need to shift or what are some of the challenges for first time business owners that they need to really work on and shed to get out of the way so they can be successful?
- [09:35]
B
Well, the folks that have come from either a corporate world or a more established job, usually their job descriptions are very narrow and they've chosen a job and things that they like doing or they feel like that they're good at doing. And that's not the case when you own a business necessarily, especially in a startup phase. Everything is your responsibility as the business owner. So pushing yourself out of the comfort zone is definitely something that business owners have to do because at the end of the day the buck stops with you. So you're going to be pushed into doing things. If we are talking with a candidate for a franchise for roof scientists and they're like, well, I just, you know, I can't see myself selling to customers. Well, you either better learn how to do that, get out of your own way with regards to your fear there, or you're going to have to bring somebody on your team that will do that for you. And so when you bring somebody onto your team, you realize that you're not only making an investment in that person, but you're adding layers to the organization. And that might not be the right thing to do out of the gate with a business. So I think being able to push yourself out of your comfort zone, not just where you've been comfortable your entire career, understanding that the buck stops with you, everything has to be done. Schedules are out the window. When you start a business, there's no 8 to 5, it's when does the work need to get done and are you the person that has to do it? And the answer is always yes.
- [11:00]
A
When it comes to the franchise industry, there is a wide variety of franchisors when it comes to culture, reputation, performance, results. What makes a great franchisor, in your.
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B
Opinion, a great franchisor ultimately puts people first. You know, I think that's a fundamental we're in when we're dealing with franchisees. They're people. And so many things happen in people's lives. And in my, you know, 10 plus years of franchising, I've seen so many situations where what's going on with people is dramatically impacting their ability to operate their business in the way that might be successful or it might need the time constraint that it might be ultimately. So first, understanding and having empathy with people. Number two, really starting with candor from the very beginning of the relationship and pushing that the franchisees and us as the franchisor and knows their numbers. And really that's acting with purpose and being, you know, being making decisions based on data, taking wherever you can, emotions out of the situation by looking at real data to say, well, this is what the issue is. So having your pulse on the, on the, on the numbers is always extremely important as well.
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A
What's one mistake that's common that you see new franchise owners make?
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B
One thing that franchisees often do is they try and do everything themselves. And so I think, you know, in the case of homefront brands, in the case of roof scientists, one of the advantages we have that we offer our franchisees is our contact center. Because if you can imagine the roofing business, if you're trying to answer the phone for prospective customers and you're up on a roof and you're doing a soft wash of a roof and you're doing a Sericade project in our case, or you're working with the crew on the, on the roof replacement side and you're trying to answer the phone at the same time, it's not going to work. Right. So the ability to delegate, understand the layers of organization.
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A
Build a team.
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B
Build a team. Yeah. Yeah. So I think that's. That's one thing that you see people trying to do too much out of the gate and focusing on what's important in year one of everybody's business. Regardless of what industry you are, you're trying to build your brand, you're trying to build your local presence, and ultimately, you're trying to generate new customers. And as you do that and do a good job of it, that's how you ultimately build sustainability and referrals and the way that you're going to grow your business.
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A
Roof scientist is inside of a platform called Homefront Brands. Is there anything about Homefront Brands that you think prospective franchise owners might want to know?
- [13:47]
B
Yes, the first thing that I would say is the experience level in this building. And this building is a virtual building because we have a lot of people all over the country that work for this company is unparalleled, honestly. We have a team of people that are leading this organization and working closely with franchisees across the country, across all of our brands that have a lot of experience. Second, we have the ability to benchmark the best of what we do across all of our brands. And so we have this inquisitive mind where we're testing whether it's marketing initiatives or technology platforms, and then we're sharing what's working and what's not working across our brands. So that leverage across having five brands so far in Homefront Brands really affords our franchisees the best of the best. So the experience level of the team that's operating these brands and these businesses and supporting our franchisees, and then the leverage of the team and the vendors that we work with as well.
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A
For people considering a franchise for the first time, or even for franchisees that might want to expand their portfolio by adding additional franchise concepts to it, what trends do you see over the next three to five years in franchising?
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B
Yeah, so it's interesting to look at how AI and technology are playing into businesses. So I would say the first thing, when folks are looking at whether expanding into new franchise concepts or adding to their portfolio, pick the right businesses that are what we call Amazon proof, for instance. Right. You want to make sure these are needed services that. And in the case of ours, we pick brands and businesses that are always going to be needed. And you know that the discretionary spending side of things is not going to dramatically impact. So that's the first thing, understanding how AI is going to play into the customer process. And we're as a company and as homefront brands, we're on the cusp of the latest and greatest technology. I know you and Michael o' Driscoll constantly are out there traveling and really looking at the best platforms that are out there and the best way to leverage our technology, which flows through our contact center, which flows through the way that we, you know, we capture data and customers and help our franchisees. Customers. Franchisees capture customers as well. So I think understanding how AI and technology are going to play into things, picking the right industries at the end of the day and understanding how technology impacts the customer journey as well, but never losing the fact that human contact, whether it's through customers or whether it's through franchisees, is imperative to success.
- [16:31]
A
You've been in franchising for 10 years. Are there any success stories that you could share?
- [16:36]
B
I always think back to, you know, the first franchisee for pool scouts that we were able to bring on, and it's Tiffany Consoli is her name in Raleigh, North Carolina. And she took a chance on us. She was originally interested in our mosquito control brand that we had and came up.
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A
It's scary to be the first one.
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B
It is.
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A
She jumped right in.
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B
She jumped right in. And, you know, she now runs a business in Raleigh that does, you know, three and a half million dollars last year in revenue and has built up a fleet of vehicles and employees and has won lots of awards. Of course, she had worked in retail before, managing an REI store and having done some other things for them and really, you know, has been able to develop an incredible business, built wealth through that business, still enjoys what she's, what she's doing now, nearly ten years into it. So that's, that's what comes to mind. And on top of that, you know, I think with franchisors and franchisees, with the corporate world, you always have this line between what's business and what's personal. And I think as franchisors, like I was mentioning earlier, our relationship is, is a pretty personal relationship with the franchisees because we are involved in their lives, you know, we're helping them build a better life. And in some cases, when things happen in their personal life, it does impact their ability to operate their business successfully. So those relationships that we build with franchisees are one of my favorite things about being in franchising and something that is a lifelong opportunity as well.
- [18:17]
A
Incredible. If someone were on the fence about franchising, what's the one question they should ask themselves.
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B
Do you want to bet on yourself and do you trust yourself to follow a model, to realize that there's a greater good in a brand and always be thinking from that mindset and are you in it for the long haul? You know, if you're looking for a quick turn, I always suggest invest your money in something that you think is a, you know, a windfall opportunity. If you're looking at building a long term, you know, success and a business and that long term wealth of something that's sustainable, then take a chance on yourself.
- [19:00]
A
Michael, thank you so much for being here. This has been an incredible high value interview and I know people will get a lot from it. Thanks for being here.
- [19:06]
B
Thank you, Jeffrey.
- [19:08]
A
Thanks for being here and thanks for being here.
- [19:10]
B
Thank you.
- [19:10]
A
All right. And as always, go down into the show notes. Click on ww.homefront brands.com for more information about our five incredible fast growing brands. At Homefront Brands, you can always get a free copy of my book, the Business Athlete's Regimen for a Great Life Through Better Decisions through the link there as well. Look forward to hearing from you. Let's get you unemployed in the best way possible.