Top Non-Food Franchise Opportunities for 2024 with Jon Ostenson

0:02Who's ready to rock today Fire Nation JLD here and welcome to Entrepreneurs on Fire brought to you by the HubSpot Podcast Network, the audio destination for business professionals with great shows like inclusion and marketing. Today, we'll be breaking down the top non-food franchise opportunities for 2024. To drop these value bombs, I brought John Ostinson into EO Fire Studios. John is a top 1 % franchise broker, consultant, investor, and author of the book, Non-Food Franchising. He draws on his experience as a former Inc. 500 franchise president and multi-brand franchisees in serving his clients.

0:38He is a frequent contributor on franchising for Forbes, Inc., Bloomberg, and the Franchise Journal, not to mention an annual sponsor for Entrepreneurs on Fire. In today's Fire Nation, we will be talking about the top 10 franchise opportunities right now in 2024. Fire Nation, let's go. Also, how to evaluate these opportunities and how to jump on these opportunities and so much more when we get back from thanking our sponsors. Sales Evangelist, hosted by my friend, Donald Kelly, is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Each week, Donald interviews the world's best sales experts, successful sellers, sales leaders, and entrepreneurs who share their strategies to succeed in sales right now.

1:22A recent episode you should definitely check out is the five ways to do daily outbound with LinkedIn. Listen to Sales Evangelist wherever you get your podcasts. Hostinger is among the top web hosting and website creation brands in the world. see for yourself. Head to hostinger.com slash onfire and use code onfire for an exclusive 10 % discount. That's hostinger.com slash onfire and the code onfire. John, say what's up to Fire Nation and share something that you believe about becoming successful that most people disagree with. Fire Nation, great to be back once again. I oftentimes see people on the edge of making what I feel is a really good move for them stepping into business ownership, but oftentimes they'll decide the timing isn't right or they paralyze themselves with analysis.

2:13Well, first off, the timing is never going to be right. There will never be a perfect time. And true entrepreneurs do recognize that. Secondly, analysis is important. We highly recommend it. We participate in it. However, it's important to a point. And I recently shared a quote with our newsletter list there at Franbridge from Bob Goff, and I think he summed it up well. He says, we need to stop plotting the course and instead just land the plane on our plans. Fire Nation, what a fantastic start to what is going to be, and I quote, a fantastic interview about the top non-food franchise opportunities for 2024.

2:47And brother, you have been busy. I am seeing you all over the place. What the heck have you been up to? Been a great run here. I recently opened up another franchise myself. This one's down in Delray, Florida. It's my first one in the health and wellness space. And it's unique in that it's an investor model where the franchisor is actually running the business for me. And those are very rare in franchising. There are only four or five companies out there that do it today. But obviously, those have been very popular with our clients. And I'm personally participating as well. So excited about that.

3:19We just came off the one-year anniversary of our book, Non-Food Franchising. It just had a great response. And so many EO Fire listeners have We've been able to read that and consume the content, and we've gotten great feedback. Really, most importantly, this past year, we've been able to help so, so many folks get into business ownership, either for the first time or maybe they're a current business owner, and this complements their current portfolio. Yeah, absolutely love being able to help people and then see the milestones as they hit them. I mean, you've worked with hundreds, and into 2024, it's going to be moving into thousands of Fire Nation, of EO Fire listeners.

3:58You've helped them both find, and even more importantly in some cases, evaluate franchises. So what are you seeing in the franchise landscape as we enter 2024 with a bang? You know, I was speaking at a franchise conference this past week and talking to hundreds of franchisors. And I've got to say, John, it is a great time to be in franchising. Really over the past two to three years, we have seen more interest than we ever have before. I think COVID kind of led to part of that, you know, cash on the sidelines. And lately, I'd say, you know, a lot of real estate investors, you know, probably 75 % of our clients also invest in real estate.

4:34And the fact is interest rates have gone up, you know, their scarcity of inventory out there, there's just not many good real estate deals to be had. So we see more and more real estate investors coming over. And, you know, from a theme standpoint, what we're seeing on the landscape, you know, you know, we're seeing interest in what I would call recession resilient industries. You know that I like the non-sexy, non-trendy, understandable cashflow-in businesses. But oftentimes I get asked the question, what kind of business do you want to be in if a recession were to come along? And I always go back to what will people always spend on?

5:05It's their kids, their pets, their aging parents, their homes, their health. So I think businesses under those big umbrellas stand to do well. Fire Nation, you're about to love this next part because I know that you love fire rounds and I want to have some fun. We're going to do a rapid fire share of 10 franchise opportunities that are resonating with John's clients right now at such a high level. So John, we're going to do five right now, take a quick break, and then crush the next five. So take it away. We'll start out with a couple of those businesses like I was describing, non-sexy property services type businesses.

5:41The first is in the concrete paving and line striping business. This is a franchise that has its B2B. They do a lot of parking lots. They have national accounts. I'm personally invested in their Minneapolis location, but it's a business that doesn't require brick and mortar. There is no retail component. All-in investment on this, when you look at the franchise fee, the startup cost, and the working capital for a few months of operating, you're all in right around$200 ,000,$250 ,000 for a single territory. Typically, with franchises, they define a territory maybe by number of addressable households or businesses, or maybe it's population, like 300 ,000 in population.

6:15Oftentimes, you will see people kind of stack those and do multiple territories. purchases. But with this business, again, on an investment of$200 to$250, the average revenue is$750 with north of 20 % bottom line margin. So really nice return on investment in a business that's not going out of style. Second, another property services business, this one provides temporary walls. We always talk about riches in the niches. Well, they put these temporary walls around construction sites, around renovations sites. That could be in airports, retail, hotels, offices, hospitals, just as examples. It's very much like an equipment rental business, if you will.

6:53The walls actually pay for themselves in about 70 days, which is nice. Again, no brick and mortar or retail component to the business. But great group behind this, really strong franchise experience, married with industry experience, which we always like to see. The investment on this one, you're in the, I'd say 250 to 350 range, really depending on how much inventory you start with out of the gate. Now, listen to this, the average revenue is about two and a half million at 40 % bottom line. So incredible returns. Now that's a small sample size. So I always tell people, let's go conservative when we have a small sample size in that financial representation.

7:29This is one that's truly an emerging brand. Third, dumpsters. I've talked about dumpsters once or twice before on the show. I love that industry. It's a highly fragmented mom and pop type industry. You've got a couple of big players, but if you can come in and kind of compliment them and not overlap them, it's a win. And so there's one that we really like where they just bring a white collar approach to a blue collar industry. The leadership has been in the business for 50 years. They've got all the relationships. They can negotiate tipping fees on the backend. They've got all the marketing and technology dialed in, really differentiating from the competition.

8:05And we've just seen with clients, they go into a market and quickly gain market share. They're usually at a million dollar run rate by the end of year one, building up to an average of two to three million. once they're a couple of years in. And this is a business that can be run with only two employees. So fewer employees is heavy, obviously, on the CapEx side, investing in the equipment, the actual canisters. So all an investment on this one because the heavy CapEx, you're probably about half a million to maybe 750. Of course, SBA loans are very common for businesses like this, where you might put in 20%, 25 % cash, and then leverage the rest through an SBA loan.

8:42And there are a lot of tax benefits with a business that's heavy in CapEx as well. All right. Number four, switching gears a little bit. Let's talk about the silver tsunami, the aging population. We hear about it all the time. It's definitely a macro theme for many years to come. And the in-home care space is more needed than ever. Everyone has aging parents or grandparents and they want to age in place and stay in their home, but oftentimes they need caretakers. And the caretaking industry is a crowded industry for good reason. There's a lot of demand, but there's one business in particular that we feel like has built a better mousetrap.

9:19The leadership team has been in the industry for several decades and really built a better model where you can run it with fewer employees, better service to the customer. I won't get into all the details here, but ultimately it's a new spin on a growing and much needed opportunity in the market. We've actually had 12 clients already this year purchase just the in-home senior care business here. So that's one you can get in on the lower end, probably more like 125 to 150. And, you know, the item 19 in their FDD where they make the financial representation, you know, it's a small sample size, but they're showing franchisees at around 2 million a year at about a 20 % bottom line.

9:59So again, when you extrapolate and do the math, really attractive returns. And then our fifth one would be kind of shifting gears over to the youth side, youth soccer. Soccer is more popular than ever in the U.S. And with the World Cup coming in a few years and MLS growing, it's only going to continue. And this is a business that complements current soccer leagues. And so they provide lessons, clinics, camps. They've been in business over 20 years. They had started with 14 corporate locations, private equity backed, and just entered franchising in the last couple of years. But great team behind this one.

10:31You're primarily using part-time employees, all on investment. You can get in as low as$100 ,000, maybe$150 ,000 tops. And then what they're showing on those original 14 locations is an average revenue of$1.5 million with about 30 % bottom line. So really, really attractive. And obviously, there's a community feel-good impact with this as well. And I think we've had seven or eight clients placed with this one this year. Wow. I mean, Fire Nation, is your appetite wet? Are you starting to get some ideas, some aha moments? Well, hang on to those afterburners because we got five more coming your way when we get back from thanking our sponsors.

11:08happy 2024 fire nation q1 is here and that means new goals more growth and upgrading your day-to-day workflow while most sales folks are stuck in the mud of manual scheduling digging into data and tracking down leads let me share a better way to win so you can get a jump start on your year the new hubspot sales hub is smart sales software for today's multitasking reps it's built to help you manage every stage of your sales pipeline with ease it's filled with easy to use and powerful tools that make closing deals and collaborating across departments a breeze. Sales Hub is an all-in-one platform for multiple things, including converting contacts into customers, accelerating sales with smarter sequences, managing deals with simple and powerful tools, forecasting targets, and smarter sales insights.

11:51Plus, you can supercharge your work with AI-powered apps like ChatSpot. Bottom line, Sales Hub is focused on helping you work smarter, not harder, so you can get after all those other New Year's goals. Close more deals and get on track for your best Q1 yet, explore the new HubSpot sales hub and AI tools like ChatSpot at hubspot.com slash sales. A website is something every business needs, but if you've ever gone through the process of getting a website up and running, then you know it's not easy. Lucky for us, Hostinger makes building a professional website effortless. Hostinger is among the top web hosting and website creation brands in the world with a mission to empower entrepreneurs to create their own business website or e-commerce store, and they make it possible with their user-friendly software, no coding skills or technical expertise required, and website creation has never been easier with Hostinger's AI Website Builder.

12:39This simplifies website creation. You can even create your logo and SEO-friendly copy with the help of their AI. Best part is, Hostinger plans start at less than$3 per month, and that includes a free domain name. I tried out Hostinger myself, and their AI tools made building a website such a breeze. It took me just a few minutes to personalize and set everything up all without breaking a sweat. See for yourself, head to hostinger.com slash onfire and use code onfire for an exclusive 10 % discount. That's hostinger, h-o-s-t-i-n-g-e-r.com slash onfire and the code onfire. John, we're back and I want to keep this party going, brother.

13:19You dropped five incredible opportunities. Let's hear the next five. My whole theme is I don't do food often. It's just there are easier ways to make money in most cases. However, there is one that we like out there. It's actually a food truck in the donut space. And this is a business, only two employees, flexible hours. It's not location driven. And the donut batter doesn't go bad for a full year. So you cook it right there in front of the client or customer. And you have very high margins. You just don't have that spoilage. So as a result, you know, this business is averaging around 200 ,000 in revenue and it's dropping about 150 to the bottom line, really attractive margins.

14:01You know, investment wise are right around 200 ,000. And, you know, when you think about a business like this, you know, you can park these things at outlet centers. You can take them to office parks, high school football games, private events, a lot of potential end uses for it. So, again, I don't do food often, but when I do, I like those kind of characteristics. All right. Now, maybe a more healthy concept would be anti-aging and beauty solutions. You know, everyone's talking about longevity and anti-aging. And so this is a business that provides that component, but also the beauty side. And they have just been growing really rapidly.

14:34You know, they provide hormone replacement, peptides, IVs, vitamin injections, supplements, needling, sculpting with about a dozen other services. And as a franchise owner, you can kind of pick and choose which ones you want to provide, maybe out of the gate and then as you scale up. But this one is one that competes really well within the med spa space versus competition. It's a membership model. So you've got a recurring revenue stream. It is a little heavier on the investment than some of these. You know, you're looking at probably the four hundred, six hundred thousand range all in. Again, as a reminder, that's your franchise fee, your startup cost and a couple of months of working capital built in.

15:09But they're averaging about one point five to two million in revenue per location. You know, some with doing as much as 3 million. So big, big potential there. Number eight, in a similar vein, this is probably the fastest growing franchise at the moment. It's in the men's health arena. You know, testosterone replacement therapy would be kind of the 80 % of the business, you know, represented by TRT, which I don't know what circles you guys are in, but I hear about testosterone replacement everywhere I go. And again, highly fragmented market. This is an opportunity to get into what's quickly becoming the biggest player out there in that space.

15:45It's a high ticket recurring revenue model. The challenge, though, is it's selling out really fast. A lot of major markets are already taken. I think they've done 300 territory deals in the last six months. And we've had clients, I think we've placed about 25 territories, six clients. And so we're definitely participating, but it's competitive for the different markets. All an investment, you're around 300, 350 ,000. And then get this, based on their corporate locations that have been open a couple of years, they're averaging 1.8 million in revenue per year with about a 30 % bottom line. That translates to over 600 ,000 on the bottom line on an investment of 300 to 350.

16:24So, again, we would go in with conservative estimates, but there is huge potential in a business like that. All right, moving on to our final two. The next one is mobile pet grooming. You know, I think it's 90 million households have pets now. It's continued to grow at a rapid pace. And I continue to hear, hey, we can't find good groomers out there. Highly fragmented space. This is one. What I love about this is it's an investor model. As I mentioned earlier, these last two that we'll talk about are both that investor passive model where the franchisor runs the business for you. With the mobile pet grooming, depending on your market size, you're all in somewhere in the$250 to$800 range.

17:04And they're averaging about$1.5 to$2 million in top line revenue, about$250 dropping to the bottom line. Final one is in the insulation market, which is a$53 billion market. No one can name a brand of a company in the space. So highly fragmented. And this is business. It's an investor model where the franchisor can run it. Again, I'm making it sound like there are a lot of investor models out there. There aren't. There's probably five or six companies in total that are running it today. But this is a business that's got a lot of proprietary items around it. We've had doctors buying in. I've had corporate executives buying in.

17:39All different types of backgrounds. They're putting in maybe five hours a week on average. Early on, there's going to be a little bit more time than about five hours. and the franchisor is managing that team for them. So when you look at it that way in the time value of money, it's a beautiful trade-off. With this one, all an investment similar to the mobile pet grooming, you're probably$250 ,000 to$800 ,000-ish. And then the revenue, they're north of$500 ,000 on the bottom line with a top-line revenue of a little over$2 million. So those are our 10, John. I presented those recently at an investor conference.

18:12I think they really represent kind of a taste of different industries we're seeing in the market. Yeah, there's actually a couple that I'm like picturing some local commercial space because I'm like, you know what? I actually want to use those services. So maybe I just need a franchise there so that I can both profit from it and benefit from it. So maybe something to think about in that area, Fire Nation, who, by the way, John, is fired up right now because obviously they just heard these 10 amazing opportunities. So once again, how can we find the right opportunity for us individually? Certainly, you can Google around, but the challenge is going to be you're seeing every company put their best foot forward.

18:52They're sharing their marketing message. Even the top 100 franchise list or top 50 list, typically those companies pay to be on the list. It's a PR move. So you really have to dig under the covers. And that's where we come in. We partner with clients. And as a reminder, it's entirely free to work with us. It's very much like a real estate model. And I essentially act as a buyer's agent, if you will. So you never pay us a nickel. In a nutshell, though, the way we approach it, there are roughly 4000 franchise brands in the US. We take out most of those in the food space as well as hotels. Those are just a different animal.

19:27So that cuts us down probably by 50 percent. And then from there, we apply our filters. You know, the strong strongest financial models, competitive advantages, what are current owners saying about their experience? And then we take a hard look at the leadership team. And when we apply those filters, it usually narrows us down to somewhere in the ballpark of 50 or 60 in a given market that we feel are the best of the best. And so, you know, we're very blessed in that we do more placements than anybody else in the country. And so we also bring that insight into what's resonating with different backgrounds and why.

19:58So when we apply all those different filters, it gets us down to typically somewhere around a dozen, 10 or 12 opportunities that, you know, if I'm in your shoes in your market, here are the ones I want to be looking at. And so we've created a really streamlined process to get clients in front of those opportunities very quickly. Because oftentimes I found you don't know what you're looking for until it's right in front of you. And so we love helping our clients achieve those light bulb moments when it all comes together. So, you know, as far as the first step goes in that direction, you know, I would be more than happy to get on a call.

20:28You can come out to our website, indicate that interest, sign up for our book, Non-Food Franchising. Again, at FranBridgeConsulting.com. we'll give you a free downloadable copy. And that can be a really good primer and a good place to start. I love all of this. And I do want to say congratulations on hitting the one year mark with your book, Non-Food Franchising. I think that calls for a special offer for Fire Nation, which you might've just mentioned, but I want to make sure they hear it directly. So no pressure, but let's hear that special offer. Yeah, we would love to share a free downloadable copy with everyone.

21:00We have both a PDF version as well as an audio version that my assistant will send out to you as soon as you share your email address there on the website. If you'd prefer to go to Amazon or to another book retailer, you can certainly purchase the book. All the proceeds go to Hope International, which is a great nonprofit supporting entrepreneurs around the world. Great nonprofit that we support. So we definitely encourage that avenue as well, but would love to share that and then potentially engage if you're ready to take the next step and actually have a conversation about opportunities. Fire Nation, make that happen.

21:31And one more time, John, what is the URL? Yeah, franbridgeconsulting.com, F-R-A-N bridgeconsulting.com, and I would love to share some content with you. Fire Nation, you're the average of the five people you spend the most time with. You've been hanging out with J-O and J-L-D today, so keep up that heat. For links to everything we talked about, visit eofire.com. Type John in the search bar. The show notes page will pop up right there. John, thank you for sharing your truth, your knowledge, your experience, your availability with Fire Nation today. For that, we salute you and we'll catch you on the flip side.

22:07Hey, Fire Nation, a huge thank you to our sponsors and John for sponsoring today's episode. And Fire Nation, are you ready to rock your very own podcast? Check out our free podcasting course where I will teach you how to both create and launch your podcast for free, freepodcastcourse.com. I'll catch you there or on the flip side. Sales Evangelist, hosted by my friend Donald Kelly, is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Each week, Donald interviews the world's best sales experts, successful sellers, sales leaders, and entrepreneurs who share their strategies to succeed in sales right now.

22:43A recent episode you should definitely check out is the five ways to do daily outbound with LinkedIn. Listen to Sales Evangelist wherever you get your podcasts. Hostinger is among the top web hosting and website creation brands in the world. See for yourself. Head to hostinger.com slash onfire and use code onfire for an exclusive 10 % discount. That's hostinger.com slash onfire and the code onfire.