Transitioning From Small Business to a Franchisor with Bryan Appell

0:01Boom! Shake the room, 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 Talking Too Loud. Today, we'll be breaking down how to transition from small business to a franchisor. To drop these vibe bombs, I brought Brian Appel into EO Fire Studios. Brian is the owner of Appel Striping, a company that provides payment maintenance franchise opportunities. Their franchisees benefit from their already thriving national work. In today's financial, we'll talk about the five steps to transition from a small business to a franchise business.

0:37We'll talk about how do you know if you're ready to be a franchisor and so much more. And a big thank you for sponsoring today's episode goes to Brian and our sponsors. Marketing Made Simple, hosted by my friend, Dr. JJ Peterson, is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Marketing Made Simple brings you practical tips to make your marketing easy and more importantly, make it work. A recent episode all about how Liquid IV is using marketing to shake up the beverage world, dives deep into the strategies that have propelled Liquid IV to remarkable success, a must listen.

1:07Listen to Marketing Makes Simple wherever you get your podcasts. Many EO Fire listeners have launched non-food franchises and Franbridge Consulting has guided them. Franbridge's founder and frequent EO Fire guest, John Ostenson, has done more placements than any other in the country and his service is free. Sign up for a consultation with John or get a free copy of his book, nonfoodfranchising at franbridgeconsulting.com. Brian, say what's up to Fire Nation and share something that you believe about becoming successful that most people disagree with. Fire Nation, how are we doing out there today?

1:43Becoming successful in a small business, it's really an all-in thing. It's not a passive thing. And some people, I feel like there's a misconception out there that some people think they could get into a small business, lay back, be passive, hire the right people and sit back on a beach and collect some money. It's 100 % not like that. You have to be all in and committed. Fire Nation, are you all in? Are you willing to focus to follow one course until success? If so, keep listening. We'll be talking today all about transitioning from a small business to a franchisor. And I think, Brian, I think a lot of people are intimidated at the thoughts of becoming a franchisor.

2:29It sounds so professional. It sounds so intimidating, like we're wearing this suit jacket and a tie and all this stuff. How do we know if we are ready to go from a small business owner to start franchising? Well, you're right about that. It was intimidating for myself thinking about it. When all your systems are in place and that the day-to-day the operations are functioning without so much of your involvement from an owner and you're thinking, hey, what is that next step? If those things are in check, that next step potentially could be you becoming a franchisor. That's what it was for me. But let's talk about how you overcame that intimidation.

3:09What was the step that you were like, okay, I think I can do this? With me, it's once I perfect things, I like to move on to the next thing. So I felt like I've really perfected our system in the parking lot maintenance industry. And then I really just wanted to get excited about things again and get into the next step. And what was that for me as a business owner? And the path seemed clear that it was becoming a franchisor. One thing that I love when I was getting ready for this interview is that you actually created five steps to transition from a small business to actually becoming a franchise business.

3:46Fire Nation loves steps. We love the process. Let's go over those five steps now. Yeah, so my goal here was to just pretty much create like a clear roadmap of five simple steps of the process of that. So to jump right into it, I mean, the first thing you're gonna need is a good franchise lawyer or consultant. This person is gonna create that FDD document, which is your franchise disclosure document. It's the Bible as a franchisor. It's crazy to think about two years ago, I didn't know what an FDD document is. But as you get into franchising, you're going to hear that word a lot. Your lawyer or your consultant, they'll also let you know what states you can sell franchises immediately, what states are registration states, and which states are the filing states.

4:37when you're franchising your business, you know, it has all these legalities around it. It's nothing to be intimidated by, but it's something you need to know. And that's why you really want that lawyer and consultant on your side. So jumping into right into step two, a big benefit to me was going to some franchisor conferences. And I've been to a lot of conferences, small business conferences for my industry. I always get a good value out of it, but I was so surprised at these franchise or conferences. I mean, there's younger people there. They're energetic. They're like, everybody wants to help each other.

5:18I've never had that feeling until I went to a franchise or conference. So I got a great ad value from going to that. So there's many of them out there on the internet. Take a look, you know, definitely get yourself and go to one of those if you're looking to get into being a franchisor. Number three, you've got to come up with a sales strategy. So how are you going to sell these franchises? So there's a few different ways. You have brokers out there. These are guys that are going to go out and they're going to sell the franchise for you. We'll go into pros and cons later about that. There's also FSOs companies.

5:51Those are franchise sales organizations. Another avenue, this is a company that will go out and sell franchises for you. The other way is you could really come up with a plan and just market it yourself, putting it out there on social, reaching out to your own network, setting out your own letterheads. So that's three ways you can really market selling your franchises.

6:19Number four, be sure that your local operation is set up with the right people and it could run without you there all the time. You know, let's be honest, like your corporate store, that's probably making most, if not of all your income at the moment. So it's important that, you know, you have to take that into account. You have to treat that very carefully, make sure it's still running, it's running properly, but be sure that your team knows, hey, we're taking this venture. I'm taking a step back a little bit and focusing on something a little bit different right now. Number five, listen, you got to do the work.

7:01Set up a strategy, write it out, write the plan out, even if it's not the best plan and follow it. You have to do the work. Fire Nation, this is why I brought Brian on because this is a guy that can give you a strategic step-by-step plan to start thinking about what would this process look like if I wanted to go down this road. Because frankly, running a small business, it is completely different from running a franchising business. Brian, can you share details about this difference? The main difference is, look, you're now talking to people who aren't just your employees. These are people that they're business owners now.

7:44They believe in you. They believe in your process. They paid money to get into your system. And now you're not just talking to employees anymore. You're talking to these people that invested in you. And it's a completely different process than just running a small business. Fire Nation, this is why you need to understand that there is a process if you're going to look at going through this on a step-by-step plan, because you have to be strategic. It has to be the right decision for you. And you have to have all the facts in place. And we'll be talking about the pros and cons, about other things that are involved with this process when we get back from thanking our sponsors.

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11:26That's FranBridgeConsulting.com. So Brian, we're back. And before the break, both you and I teased that we're gonna talk a little bit about the pros and cons. So I wanna talk about two sets of pros and cons and let's tackle these one at a time. The first set of pros and cons is the pros and cons about not going the franchise route. So the pros for going the franchise route and the cons for going the franchise route. Then also the pros and cons of actually utilizing brokers and other processes to find franchisees, to find the right process. Go through both of those different steps. The pros of brokers is they can sell for you.

12:07They will get potential franchisees, the right broker on the hook, wanting to sign up with hopefully what you have to sell. And they have a knowledge in this industry as well of franchising, which just stepping into it, You might not have all the knowledge that you need. You know, they really can move the needle for you. So that's some pros in the brokers. An FSO, which is a franchise sales organization, is the same pros. It's just a team of people now. And you got to figure out, OK, what do they want? Is it just a monthly payment? Do they want equity in the company? Do they want a certain percentage of royalties?

12:50because some of these FSOs companies will kind of blend in and get involved in your company. And not only could they help you sell, but they could help you operate your franchise company, which some people look for that as well. Now, on the flip side, the cons of this is, look, the broker's there to sell for you. That's how he gets paid. You have to be careful of who you align yourself with? Do they know you as a person? Do they know what your company's values are? This is very important because it's exciting when there's a potential franchisee ready to sign on. Me and my team, we've talked to a lot of people.

13:36We've actually turned down some people. And it's not a bad thing. It's just we knew they weren't a right fit for our organization for one reason or another. So you have to be very careful if that broker is going to just push people through the door for you. You want to be able to say, no, this isn't the right fit. And if you do go with a broker, do not be ashamed of saying, no, this person is not the right fit for our organization. You'll save headaches for yourself. And most importantly, for him, the potential franchisee, you'll save headaches for him as well. Okay, let's go back to the pros and cons of just going down this route in the first place, as opposed to just staying in the exact position that you might be right now as a small business?

14:18Our small business, it's a successful business here in Long Island, New York. I didn't really feel like I had to make the jump. For me, it's always, like I said earlier on in this podcast, it's always like, okay, we've built a great business. What's next? And I have this need to like, I want to help people. In this industry, I feel like I could teach people very easily how to make money. I think it comes down to, are you the type of person that really wants to help people? I think that's a good indicator that, hey, you might want to go down being a franchisor. I think that's just the main indicator.

14:53What about a con? time it takes in the beginning what i've experienced is it is taking a lot more time than anticipated i understand why now because it's like this little baby you got to take care of and you got to make sure it grows in the right direction so in the beginning um it's going to take a lot of time and i'll be honest with you you're not gonna be making any money from it immediately this is a long-term goal if you want to be a franchisor it's a long-term goal When we go out and we strike parking lots, we get paid immediately on that service. When you're becoming a franchisor, you have to think about the royalties and the long-term goal of it.

15:33So it's not an immediate payout. Now, I do want to continue this talk about involvement. So let's say we do go down this route as a franchisor. How involved should we be as that franchisor with a new franchisee? As much as possible in the beginning. I told myself and my team, every franchisee that comes on board, I want to be involved in the beginning as much as possible. I know this business well. My team knows this business well. But it's so important for me to convey what we're about to the new franchisee. I have to convey that, and that has to come from me. And I want to be very involved, and I am very involved in the very beginning stages when a franchisee signs on board.

16:18Some of my team says sometimes I'm too involved, but in the beginning, it's just that's the way I want to settle up. And it's important for me. And I think it's important for the franchisee as well. I mean, Fire Nation, you have to be willing to grind your face off when you're getting something off the ground. It is literally pushing a thousand pound boulder up a hill. It is so hard. It takes all of you. But guess what? If and when you are successful getting it to the top of the hill, just a little nudge can start going down the other side. than the momentum takes it itself because guess what?

16:48Brian can by that point have a team in place where he's no longer personally involved in all of these, but his team is, and there's an onboarding process and all these different things. So you have to understand the beginning of anything that's worthwhile is about grinding your face off because if it was easy, everybody would be doing it. Please remember, Fire Nation, the success is where the hardness is, period. Because the higher the barrier, the lower the competition. You have to want it to be hard. Otherwise, there wouldn't be a great opportunity there. So what specifically do you do in the franchise world, Brian?

17:25Let's talk about your story. I started Appel Striping 23 years ago. I'm only 41. Started when I was 19. I love the business models. I'm an operations guy. I love setting things up and, you know, choreographing them to make them better and the systems better. You know, I started line striping in college just on the side and I said, wow, this could really be a business model. So my idea was, hey, let me, I'm going to finish college here in Florida, move back up to Long Island, New York, started the business there, grew it slowly and steadily. The real change in my business, though, is about seven years ago when we decided to go after national accounts.

18:09We started growing. We're now working in all 50 states of the United States. And that's the ad value I bring to the franchisees when they come on. There are a lot of markets and territories that we already have work that we're subcontracting out to. So our vision is when we bring on these franchisees, that we're giving them work on day one. And that really helps because we're obviously developing their local market as well. But to give them a package of work in some territories where they could work on day one, that's really what sets us apart. And that's really what we're doing for our franchisees.

18:52Brian, we talked about a lot of awesome stuff today. I mean, that five-step process is going to be gold for some people that are really looking to explore the possibility of this. Give us one key takeaway that you want to make sure our listeners get from our conversation today. I think you nailed it. I think it's, you have to grind. You have to be willing to really put in the work and sacrifice, you know, especially the younger you are, the more bullshit you could sacrifice. You could sacrifice that night out. Listen, I have four kids now. For me, sacrifice is different. I'm not willing to sacrifice certain things when it comes to my family.

19:31But when I was younger, you bet your ass I skipped a lot of nights out and having fun just because I knew I was going to be up at four in the morning grinding this company so I could get it to the level that it's at now. Fire Nation, I hope you understand the power of the grind after Brian and I have both grinded this into your ear balls. Brian, what is your call to action for Fire Nation? What do you want our listeners to do right now? If you guys are interested in talking more about this, you can find us on Instagram, appell on the score striping. Easiest way you can touch with me is probably DM me on Instagram.

20:08You have appellstriping.com, appellfranchise.com. Even if you want to just message me that you're starting the journey into possibly becoming a franchisor and want my take on it. I love talking about that stuff because it energizes me for the things that I'm doing in my own company. Fire Nation, you're the average of the five people you spend the most time with. And you've been hanging out with BA and JLD today. So keep up that heat. For links to everything we talked about, visit eofire.com. Type Brian, B-R-Y-A-N in the search bar and the show notes page will pop right up. And Brian, thank you for sharing your truth, your knowledge, your value with Fire Nation.

20:47For that, we salute you and we'll catch you on the flip side. Thanks, John. Appreciate you, man. Hey, Fire Nation, a huge thank you to our sponsors and Brian for sponsoring today's episode. And Fire Nation, successful entrepreneurs accomplish big goals. That's why I created the Freedom Journal so that you can accomplish your number one goal in 100 days. And we're talking step by step, visit thefreedomjournal.com and I'll catch you there or on the flip side. Marketing Made Simple, hosted by my friend, Dr. JJ Peterson, is brought to you by the HubSpot Podcast Network, the audio destination for business professionals.

21:24Marketing Made Simple brings you practical tips to make your marketing easy and more importantly, make it work. A recent episode all about how Liquid IV is using marketing to shake up the beverage world, dives deep into the strategies that have propelled Liquid IV to remarkable success. A must listen. Listen to Marketing Makes Simple, wherever you get your podcasts. Many EO Fire listeners have launched non-food franchises and Fran Bridge Consulting has guided them. Fran Bridge's founder and frequent EO Fire guest, John Ostenson, has done more placements than any other in the country and his service is free.

21:53Sign up for a consultation with John or get a free copy of his book, Non-Food Franchising, at FranBridgeConsulting.com.