I sat through 128 pitches by emerging non-food franchises (so you don’t have to)

by | Feb 4, 2024 | Blog

A few weeks ago, I sat in a chair for 3 days and listened to 128 shark-tank-style pitches from founders, executives, and sales reps with emerging franchise companies (all non-food). 

By the end, my brain was mush. 

But I learned a ton. 

Here are my 4 takeaways…

 

#1: Non-food franchising is getting more and more popular

Non-food franchising has always been a popular option for folks looking to transition out of the corporate world and that trend continues. 

But there’s a new crop of buyers discovering non-food franchising…

Real estate investors looking for a new way to deploy capital and generate cash flow.  

Younger folks who have the itch to do their own thing and don’t want to play the corporate game.

Family office and PE money is moving into franchising in a big way (and not just at the franchisor level). Several large multi-unit franchisees have exited to institutional buyers. 

Lots of indicators are out there that these trends will continue. 

 

#2: Some of the least suspecting franchises can be amazing businesses 

Every year, I’m amazed by entrepreneurs who have discovered a business in a surprising niche that is a killer model and start expanding the brand via franchising. 

Accessory Dwelling Units?

Before this conference, I didn’t know Accessory Dwelling Units were a thing (and they’re a monster thing in some areas). 

One franchise in particular in this space reported some of the craziest numbers I’ve heard in a long time (something like $40M+ in revenue last year from a corporate operation in one region of the country)

Metabolic weight loss?

I’ve heard about the Ozempic craze and the hormone replacement movement sweeping across the country. And there are a couple of franchises capitalizing on this opportunity (not named “Gameday”).

Haircare is coming back! 

If you want to talk about one of the proven categories that lends itself to a good multi-unit play, it’s haircare. Everyone needs to get their haircut, right? There are some strong brands in this space picking up steam (and none of the franchise owners are cutting hair). 

You can make money recycling clothes? 

Yep. There’s a super nichey business out there that makes money by collecting clothes and reselling them (but not via a retail store or online). Secondhand clothing is a hot category. What’s even hotter is this franchise doesn’t require a lot of employees. 

There are more on the emerging side that stood out. 

Lastly, tried and true categories like home services, senior care, pet-related services, kids enrichment, and education continue to perform well. 

Not everyone is comfortable jumping on the new thing. There are plenty of these tried and true franchises continuing to do their thing well. 

 

#3: Macroeconomic factors are normalizing 

The labor market is normalizing. 

This is probably some of the best news out there. Yeah, inflation has affected the costs of everything, including labor. But, people are siphoning off of the free government money and getting back to work. This is great news for entrepreneurs. 

Funding hasn’t slowed down a bit. 

Look, the reality is banks like the high-interest rate environment because they make more money. The good news is the math still works for franchises with a reasonable CapEx. Money is flowing. 

 

#4: The brands that focus on their franchisees’ profitability and success are the strongest 

No matter how sexy a franchise sounds or how many units they say they’ve sold, the enduring fundamentals of franchising still apply. 

The brands that have a relentless focus on their franchisees making money, beat the market, and create a wealth-building opportunity for their franchisees. 

The reality is every franchise says they do the same thing… 

“We have a marketing plan”

“We provide training and support”

“We have killer economics”

“We sold [insert whatever number you want here] units last year”

Yada, yada…

At the end of the day, the best franchises execute better than others.

And the proof is in their franchisees’ success (and numbers).

 

The last thing I’ll say…

Look, I can make this franchising thing sound amazing  (I’m a broker, what do you expect 😃).

So here are a few things franchising is not…

#1 – It’s not easy. 

#2 – It’s not for everyone. 

#3 – It’s not a passive or absentee investment.

Financially, I believe the math and income potential can be better than most options out there.

Risk-wise, if you get in with the right franchise, you’re going to significantly increase your odds of achieving what you want to achieve versus doing it on your own. 

Personally, if you have heart, hustle, and a reasonable amount of capital, I bet there’s a non-food franchise out there that you can have success with. 

And there’s only one way to find out. 

Dig in and do the research. 

There’s a certain way to go about conducting the due diligence on these brands and all the fun information they throw at you.

So, here’s my offer…

If you’re serious about changing your life by starting your own business, we should talk.

I’ll help you find some brands that check the boxes you’re looking for and want to expand into your area. 

I’ll also load you up with guidance and resources that will help with your due diligence so you can get the answers you’re looking for.

Reach out anytime. 

And if you’re ready right now, grab a time on this calendar so we can hop on a call and kick some ideas around 👇

Schedule a Strategy Session

The First Step is a Conversation.

If you have that burning desire to build your own successful business so you can live a life you can only have working for yourself, let’s talk.

The First Step is a Conversation

The first step is a pretty simple one: We have a conversation.

After we speak, we’ll be able to figure out if there is a good fit to work together.