Page 94 - Entrepreneur - USA (January - February 2020)

THE FRANCHISE
Strategy #1
Focus on your (faster!) fundamentals
Company
Scooter’s Coffee
Franchise 500 Placement
#460 last year; #225 this year
eople will reward the company that serves them
fastest. That’s the theory at Scooter’s Coffee, at
Pleast—and it’s showing results. “If you look at the
national data, the average drive-through wait time at
Starbucks is just over four and a half minutes,” says Tim
Arpin, VP of franchise recruitment. Scooter’s aims to
do it in 40 seconds. And customers don’t even have to
leave their cars, since the coffee arrives via a drive-through
kiosk window.
This superfast concept has helped Scooter’s open about
30 locations annually for the past six years. Last year, that
number more than doubled to 65 (which helped send it
235 spots higher on our list), and next year the company
expects to open 100 more units. To explain the growth,
Scooter’s points to a COO hired from Starbucks in 2017 and a
chief development officer formerly at Arby’s in 2018. But the
real story comes from the years leading up to the hires, when
Scooter’s invested more heavily in its foundation than it did
in recruiting franchisees. “Often franchises bring in a fran-
chise seller and sell a bunch of units, thinking the rest will
solve itself,” says Arpin. “It’s a cautionary tale in franchising;
brands get out over their skis.”
Scooter’s has maintained balance by never allowing its
ambition for growth to overtake its focus on the customer
experience. And even now, as the company ramps up its
expansion efforts, it continues to work toward faster service
with a new POS system, a new suite of analytics tools that
will help it anticipate growth, and a pilot program for pre-
ordering drinks. “Everything we roll out is focused through
the lens of creating a frictionless experience,” says Arpin. “It
takes a lot of foresight, investment, and patience, but it’s the
right way.”
In this brand-building vision, growth follows the service, and
not the other way around. “We have a clear understanding of
what works and what doesn’t for our model,” says Arpin. “That
has allowed us to accelerate our growth efforts without spend-
ing too much time second-guessing ourselves.”
The company has several new initiatives to celebrate, such
as a mobile app and a canned cold brew it can sell in supermar-
kets. And in a recent survey, 90 percent of franchisees reported
they were happy enough with the company to recommend a
franchise to friends and family members. But Arpin insists
success will continue to follow its ability to impress custom-
ers. “Often, you get one swing at somebody,” he says. “If you
focus on speed and customer service, they will come back. And
they’ll bring their friends and family, too.”
92 / ENTREPRENEUR.COM / January-February 2020
Strategy #2
Be very, very franchisee-friendly
Company
GarageExperts
Franchise 500 Placement
Unranked last year; #231 this year
hen the 2008 recession hit, Mike Meursing saw an
opportunity. The country had a surplus of highly
Wmotivated people who weren’t earning what they
were worth, and he wanted to put them to work. So Meursing
built GarageExperts, a low-cost franchise that would pick up the
self-starters that other franchise companies overlooked.
The company provides pro-level makeovers on neglected
garage space. And the entry costs are easy to swallow. Franchisees
pay a $15,000 fee to launch their business, and if they don’t bring
in at least $750,000 during their first three years, the corporate
office will refund that franchise fee. “We want them to have a little
bit of skin in the game,” says Meursing. “But more important, we
want them to have money to use for their marketing and every-
thing else they need to build up the business.”
The model all but demanded slow, careful growth. Unlike
a company that charges, say, $50,000 in franchise fees—with
no guarantee on revenue—Meursing put himself in a position
where he was fully reliant on his franchisees’ success. If they
didn’t succeed, he wouldn’t make money. So he onboarded fran-
chisees gradually and spent time making sure each one knew
how to follow the company’s strategy. For instance, the com-
pany coaches franchisees to manage their supplies carefully,
buying only what they need for each specific job. “We don’t want
franchisees buying material that’s going to sit in their garage
and collect dust,” says Meursing. “This way, they don’t have too
much money tied up in inventory.”
In 2018, after a decade of success, Meursing finally felt com-
fortable scaling. “We were confident that the systems we had built
were now at a point where we could begin a hypergrowth strategy,”
he says. That year, GarageExperts added a record 31 franchisees. It
also boasted its lowest rate of franchisee turnover—a testament to
its ability to better screen for successful franchisees. All that helped
create a strong return to our list after dropping off it.
And by all evidence, the company’s growth is just beginning.
GarageExperts recently introduced new rules that would make
it easier for current franchisees to purchase more territories,
and last year, it launched a national commercial ad campaign.
The system now includes 90 franchise units in 30 states, and as
the growth threatens to create distance between the franchisees
and the corporate office, Meursing is introducing new methods
for making sure that each owner still has a voice. GarageExperts
recently surveyed its partners to learn where exactly they need
more support. “We’re going to release those results and talk about
them at an upcoming convention,” says Meursing. “We want to
have transparent communication with our franchise partners,
and we want to be as good as we can to help them grow.”