We Bought A Franchise!
Join Jack and Jill Johnson on their rollercoaster ride as the fresh faced new franchise owners of Pink's Window services in sunny Palm Beach, Florida! Peek behind the curtain at the real deal of launching and expanding a franchise – the good, the bad, and the downright chaotic!
The Johnsons are set to reveal the highs and lows, the freedom, and the fortune that come with being your own boss. Tune in to the "We bought a franchise" podcast today! 🎙️🏝️
We Bought A Franchise!
We Bought a Franchise Podcast: Emerging Non Food Franchises with Fransmart CEO Dan Rowe
Ever wondered what it takes to turn a small franchise into a nationwide sensation?
What if you could spot the next big franchise before it becomes a household name? Legendary franchising expert Dan Rowe from Fransmart joins us to reveal his secrets for identifying and nurturing emerging brands that have led to astounding success.
Join us on this thrilling episode of the We Bought a Franchise podcast as we host the legendary Dan Rowe from Fransmart. Dan shares his remarkable journey to becoming a powerhouse in franchising. Listen as he recounts how he transitioned from a lucrative career in computer software to buying his first restaurant franchise, helping to scale brands like Qdoba and Five Guys from a handful of locations to hundreds, and his current innovative ventures including Swing Bays and Paymore.
Discover the secret sauce behind Dan’s success with emerging brands and his ability to identify the next big thing in franchising. We'll discuss the pivotal importance of timing in franchise investments and how getting in early can lead to massive opportunities. Dan also dives deep into his investment philosophy, his work with iconic brands, and how his fund supports early-stage companies. Whether you're an aspiring franchisee, an investor, or simply fascinated by franchising, you won't want to miss Dan’s inspiring journey and valuable insights.
Visit www.weboughtafranchise.com to subscribe.
Send us your questions for an upcoming episode at 305-710-0050.
From your pals in franchise ownership, Jack and Jill Johnson.
Visit www.weboughtafranchise.com to subscribe.
Send us your questions for an upcoming episode at 305-710-0050.
From your pals in franchise ownership, Jack and Jill Johnson.
Hi everyone, welcome to the we Bought a Franchise podcast. I'm here, of course, with my co-host, jill Johnson, as always.
Speaker 2:As always, Hi everyone.
Speaker 1:And we have a legend in franchising. With us today we have Dan Rowe from Fransmart. Dan. Well, dan, you have more brands than I can get out in one breath and more experience than I can get out in two breaths, so I know our audience is going to be thrilled to hear your story today. Dan, welcome to the show, thanks. Thanks for having me. Of course, we've been working with Dan now for years with brands such as Paymore, such as Rise Biscuits, and now Dan has a very exciting new brand called Swing Bays and we just had to get him on the podcast. But, dan, we'd love it if you'd maybe share some of your story and what got you into franchising and a little bit about you.
Speaker 3:Yeah, so I worked in restaurants forever. I worked in restaurants as a teenager and I was a college dropout, barely got out of high school. Um, I was a college dropout, barely got out of high school and right after high school I uh, left the restaurant business, got into computer software for four or five years, made a whole bunch of money and bought a restaurant franchise. So I actually bought a bagel bakery franchise 35 years ago and the company had six stores at the time and, uh, I negotiated a deal. I said I'm going to open your franchise, but if I do, I also want to be your franchising guy. And I grew that company from six stores to about 200 and sold the company. And one of my shops was in Denver, across from the first Chipotle, so back when Chipotle only had one.
Speaker 3:So this became a theme for me. I'm seeing these emerging brands. Really, really early we couldn't talk Chipotle into franchising, but somebody copied them in Denver with a company called Qdoba, so Qdoba Mexican. So we invested in Qdoba when it was only one location open about 90 days we wrote the manual, systems, procedures and we grew that to about a hundred open maybe another four or 500 in development, sold that to a Jack in the box and then after that I did five guys. So five guys had four locations open in DC where I live, dc suburbs and I and I our group was the first franchisee and same thing. We built out the systems and the manuals and holding franchisees hands. Uh, as we grew we got it up to maybe 100 open, 400 or 500 in development and then we got bought out.
Speaker 3:So that became sort of the theme of my company is always emerging brands, early stage, emerging next big thing as early as you can, because we know that we can help fix. And so, yeah, for 30 years we've been doing that. We have a fund that also invests in brands. We were angel investors in Sweetgreen and Kaba, which both had IPOs recently, about two years ago. Two and a half years ago we diversified into non-food and I didn't know how I'd do with it and the first brand that we had we listed with you guys and we've been keeping Brian super busy. But uh, pay more. Uh, we got there when there was one location about three years ago and now there's 80 something open, 500 in development and uh, almost every franchisee is even bought more territory. So I think we're doing well with our first uh, non-food brand.
Speaker 1:I mean, dan. That's an incredible story and you know we are. I'm not even going to put us in the same sentence as you in terms of investing in emerging franchises.
Speaker 1:But I think that was part of what got us on the whole Pink's Windows concept. It had like maybe two territories and we loved that. We loved that it was new, we loved the sort of adventure of the sort of pioneering brand, and not everybody's for that. But I think that you probably see the same thing that we do is if you can get in on a concept at the right time, you can get more territory and it can lead to bigger things down the road. For Paymore, I saw something very interesting in that there is a new franchisee that started with maybe a handful of units and then added up to 35. Is that what just happened?
Speaker 3:Yeah, Almost every franchisee. They come into the system, they buy whatever marketing or the sales pitch that we have. They go through the process, they buy the franchise. Once they're in and realize how good it is, they all keep buying more territory. And one of your folks came back, I think, and he bought. I want to say he started at five units and he came back and bought like 35 more or something like that, and he's a big franchisee of a bunch of other brands. And so what's happening is when people really realize, pay more, they're securing as much territory as they can. It's a very, very, very low capex, very high sales, very good profit. I mean franchisees are super, super happy, super referenceable. That's sort of when you know it works is when the existing franchisees that are already open keep buying more.
Speaker 1:Yeah, yeah and, to be clear, I wish I could take credit for it, but Jill and I are affiliated with a group called Francer, which has hundreds of franchise consultants, and there's another franchise consultant who helped you guys with that deal, dan. What is it that makes Paymore so attractive? How are the numbers as good as they are? And also, it seems for a retail franchise. To me the investment seems very low it is.
Speaker 3:There's not a lot to the build out. It's basically buy, sell, trade new and used electronics, so it's a very low cost. It's a nice looking build out, sort of like a Verizon wireless or something. Now, when you compare that to a restaurant that needs all this heavy mechanical, electrical, heavy walls, fire rated walls, like you don't need any of that stuff in a in a in a pay more. So pay more is just a very, very, very simple build, very clean, very nice.
Speaker 3:And what happens is people bring in electronics. We already know we the founder of the company's built this incredible backend actuary program. He knows exactly what your options are to sell it anywhere else, he knows what he can pay you for it, how fast he's going to sell it, what he's going to sell it for. And yeah, I mean it's just a really asset, light, fun business, super, super tech enabled and the things taken off. I mean it kind of hits on it hits, it hits on all the anytime you get a franchisee.
Speaker 3:Nobody wants to own a franchise. They want to build a franchise company. So you got to look at businesses that are easy to operate, easy to scale, very, very high ROI, so that you want to keep reinvesting your money into opening up more locations, and this one just hits it all. So we've got I mean we have franchisees from food and from beauty and from electronics. We have all these. You break it. I fix franchisees that once they saw this, they jumped on and we got all kinds of people. When they look at it, the model, the economic model, is like hard to beat, but even just the business model. And then you look at like all the technology and all the advantage and all the kind of smarts in the company, at this early stage it's like a trend line for what it's going to be like next year, five years, 10 years. But yeah, I mean we got lucky with this one. This one it was our first non-food brand and man it's just out of the park.
Speaker 1:Yeah, and I think that's a great segue, dan, because you've got so much food experience and it really appears as if, at least right now, let's say in the franchise broker world food franchising has. It seems like people are buying non-food much more than they're buying food franchises. I'm curious. As someone with so much food experience, I think I know the answer right. It's expensive, the margins aren't always as good, you've got to have a lot more capital. Why is it? Do you think there's been such a shift towards non-food franchises in the past, let's say five years?
Speaker 3:They're just easier.
Speaker 3:They're easier to open, easier to operate, easier to staff, easier to scale and at the end of the day, it's about ROI. So if you just sort of objectively lay out, you know all the different metrics of these brands. Um, there, there, there, there's so many non-food franchises that are just that, are just hard had membership people paying you a membership fee to be a customer a restaurant we've never had that. And so usually restaurant concepts they have, they have a lot of headwinds right now, like very high cost of goods, like there's just a lot of economic pressure on that labor. I mean it's just hard to find people, it's hard to keep people. So you need to have brands that do lots of volume with few employees. And why I mean few employees? Not only so that your labor percentage is low, but if you're trying to grow a franchise business, you don't want turnover. So you have to be able to comfortably overpay to get and keep good people longer, right? So if you're trying to build one and parlay that into five or 10 and then eventually sell the company, it's like you can't be dealing with turnover. You have to have enough money on your P&L to overpay people, right, and just make sure. And in the food business it's just hard to do that Minimum wage going up and you know it's just nuts. And so there's still plenty of good food concepts Like I mentioned, we're an investor in Cabo and Sweetgreen concepts Like I mentioned, we're an investor in Cobb and Sweetgreen.
Speaker 3:Those are public companies. You know Chipotle's public like, their numbers are fine but they're fine at a very high sales level. And then you mentioned CapEx. Like when you think about you know a, a Paymore makes more than a Five Guys, right. So a Five Guys is 600, 800 grand to open. Uh, pay more is a quarter of that, right. And then when you think about, like even a busy shift at a pay more might have four people on staff. A slow shift at a five guys, we'll have eight people on staff. A busy one will have 10 or 12, right. So it's just no comparison.
Speaker 3:So you're seeing more and more food people that are getting into non-food just because they didn't like when somebody originally buys a franchise, they pick the brand that they sort of connect with, they have an affinity for it. But at the end of the day it's still about ROI. I still want to. I'm building a business and it's not my baby, it's someone else's baby and maybe they had a connection with with the brand. But the whole goal is to become financially independent. I don't know why anyone would ever buy a franchise if their goal wasn't to get wealthy. Like buying, buying yourself a job's ridiculous. So then it just really looks at how much money can I make? How easy is it to make? I mean, what's got the least downside? How do I compound my returns? By reinvesting free money and, uh, more stores. And it's like only very few food brands allow you to do that, like some.
Speaker 1:Yeah, I think those are all excellent points and, dan, I think it's what you're saying makes so much sense and, as franchise consultants, it's something Jill and I spend so much time on, which is, look, you know, because so many people come to us and they'll say it's my dream to own a Chick-fil-A, it's been my dream to own a Carvel, really.
Speaker 2:Is it really your dream Once they hear the numbers and the work involved in?
Speaker 2:the ROI and then we show them something equivalent that's non food, then they open their eyes, but they don't. They don't know. I mean, I think that's one of the biggest challenges that we have is when we talk to people that don't work with franchise consultants or not familiar with franchising, they just think food. So that's just where their mind goes, because we think franchise food, fast food, and so then when we talk to them and we really start to have that same conversation that you guys were just talking about, it's okay. Is it really your dream? Because a lot of times we think it's our dream and then you work in your dream and it's no longer a dream. But also, in the end, we all want to make money. So it's really what's the best? Roi.
Speaker 1:So I love this and I love that there's that variety out there and that's what we try to help our clients do. And I love consultants. Dan, we're we're kind of the the brand of our company, right. We're who, you who, people you know sign up to work with. But as franchise owners, truly I want to be unnecessary. Yeah, yeah, not saying I don't want to work, but I want the business to be able to run without me. And I think that just goes into your point when we look at a business as an investment.
Speaker 1:And you know, it's no surprise that franchising has seen such a huge couple of years, with the housing market being what it is. I mean, how many pay mors could you buy for the average price of an average single family home these days? So I mean, there again is why I think you've seen such a shift. And it used to be, when I was a kid, the people that owned franchises. It was always hey, you know, my friend's uncle owns 30 subways, or something like that. It felt like this unreachable thing, like you had to be rich, um, and now it's no, you don't at all. I mean, for as little as you know let's say, 150, 200 grand you can be a business owner, um, so, dan, segwaying into another brand of yours and I want to get to swing base, cause I'm very excited about that. But first can we talk about um, about your beauty concept. I think that's one that people really need to know more about. Can we talk about that?
Speaker 3:Yeah, and first I want to mention too, I mean you guys, cause I follow you guys, uh, socially, and when I saw you bought that franchise like that, that is really telling right, like you know more than most people, I know more than most people. So by the time we actually invest our money in a franchise like that's extraordinarily vetted. But it's sort of like the old thing. If you're out there telling someone how great a brand is, they're like, well, if it's so good, why don't you own one? And the fact that you guys own one is amazing and and and I do too I invest in in our brands. But you know, I think too, I mean you guys. You said you bought into that brand when it was small, right, when it was only a couple of units.
Speaker 1:Yeah, and you know, dan, I think that's a really good point. Yes, they had like maybe a couple of units and thinks. If I'm misstating that, I apologize, but I really think it was just two about two locations and, frankly, we loved that. And you know, dan, I think you know the whole point of this. We bought a franchise podcast is to share our experiences with our clients and I think it makes us better franchise consultants being we've learned a lot. We've learned so much.
Speaker 2:I think, that one of the number one questions we used to get all the time was okay, you guys are telling us what to buy, why don't you own one? And you know our first was listen, this is our business. You know, it's like a realtor you can't go out and buy every single house that you're listing. It may be a great deal in a beautiful home, but you can't. And this was our business. But two we really wanted one that would work for us. We wanted the right brand, we wanted the right investment, we wanted the opportunity to grow and we wanted to be able to do it, you know, in a way that we can still run our business. So we really had to be picky with it. Um, but yes, I mean, I do. I do think that that does matter, but we also have tons of brands that are amazing that we'd like to buy, right, I mean.
Speaker 3:I think, and I think it's also good that you guys bought early stage because if you think about it, every huge chain, the biggest chain of retail restaurants, hotels, anything you think about it the biggest chain of anything, started with one, started with one somewhere somehow. And it's really not that complicated to grow an emerging brand If it's a good model, if it's a good concept, good model and you're convinced, I mean you'll figure this stuff out, you'll figure it out. But what you get when you get into emerging brand is you get way lower costs, way bigger territories. And if your goal is I mean everyone forgets that the double bite at the apple is selling your business. But if you guys bought early, you secure bigger territory than you had to pay for. All of a sudden you're expanding with internal cash, you're compounding your return and then someday you sell your company. You couldn't do that today in Five Guys or Panera or Orange Theory or something like that. Right, because the price of those brands, all the risk, is priced into those franchises. They're so expensive and there's so much PE chasing those things that you're never really going to get to the point where you can compound your return.
Speaker 3:So I like emerging brands. I'm happy that you guys are there too, but you asked about glow. So glow is a skincare franchise. It's a facial monthly facial to really, really cool model. There's plenty of places that do facials. Hers is a little different every single month. It's a really, really cool model. There's plenty of places that do facials. Hers is a little different Every single month. It's a different curated facial, right. So like in October it's pumpkin and July I think it's like limoncello, but every month it's a different curated facial and about every three or four months then people might get Botox or one of the other treatments that are there. But it's a very affordable, sort of like $89 a month indulgence for for someone to go to once a month and it's.
Speaker 3:It's just wild when I first when I I wasn't interested in the brand, but then a broker who follows me on LinkedIn said hey, I see you're working with a non-food brand which was Paymore, and they said would you do a facial brand, a skincare brand? I'm like I don't know. I've never had a facial. I asked my wife she goes, I mean, my wife doesn't really get those that often. But I said let me see the numbers, cause I learned, I learned better after I looked at Paymore's numbers, I said send me, send me the numbers. Their numbers are better than they're even better, right? So like the ROI, her ROI and her item 19 for a franchisee, where you have to add back what they pay in royalties and marketing and all that is like 40, 50%. Think about the profit, like not cost of goods, the profit. And so she builds these small spaces 1,200, 1,200, 1,300 feet super manageable. They've got this AI scanner that sort of scans your face and reads your face and tells you exactly what you need and it tracks the before and after. It's got all this cool bells and whistles. But we've only been with them like 15 months. We've already got 100 franchise franchisees, franchise units sold.
Speaker 3:But like here in Arizona, where I am, where I'm at, the guy that bought all of our, he started with five. He has like maybe a hundred million in sales with Papa John's, jersey, mike's, a bunch of other brands and he follows me. He goes what are you on? He sent me kind of a snarky note. He goes what are you doing with this skincare? I'm like you got to see the numbers. It's like food can't touch this.
Speaker 3:And within two weeks he met me for a discovery day and two weeks later he was the franchisee for Arizona, originally signed up for five. After we get into it and we cause we're, we're, we're operators, I get France more we're operators, we're hands-on. We got very involved in the real estate process, helped him understand the penetration plan here, the competitive landscape, where exactly you could put these things, and because all of his franchises were in food he never was in non-food we actually helped him identify and show him where he's going to be able to get like Orange Theory, regional people and really build out his team. He got so comfortable he came back and bought 20 more units in Arizona Wow. And then two months ago he bought all in North Carolina, another 20 units.
Speaker 1:Wow.
Speaker 3:And so here's a huge food franchisee and again he's just kind of looking at AB. I'm going to compare this brand and this brand and this brand, everyone hits on him, everyone hits on him for a franchise and I would be surprised if he ever went back into food after seeing these numbers. So but it's, it's a really good. It's a really good concept. There's over a hundred in development and they just hired the well-biz COO, like they just hired a like it. At every step they're going and hiring you know the the best marketing people. They actually hired the marketing group that does all the membership pre-sales for orange theory. They hired this ops guy from well biz who's just a stud, and so they're investing and they're doing all the right things.
Speaker 3:But most of the franchisees are food franchisees. We have a couple of uh, uh, great clips franchisees and you know again, when you just do the side-by-side between one of these and nothing, you know nothing against, against great clips, it's just. When you just do a side-by-side, there's no comparison, sure, none, no, um, plus you could get territory right, like that was, yeah, yeah.
Speaker 1:It's interesting, dan, how those franchises again and like you, said nothing against them and for many years that's what it was. Right, you know. But when you look at the numbers, it's it's just people in the franchising investing world now have more choices than they've ever had before, and it's it. This is, again, it's interesting how it's working at a time where real estate investing is maybe not quite what it was. So I think it just lines up very perfectly for so many investors.
Speaker 1:Dan, before we get to swing days, I have a couple of questions for you as someone that's been around this. One I want to ask you about if there's any other brands of yours we should focus on. But two, one of the things so Jill'm, jill and I are becoming much more focused on how can we help our clients really be successful as franchise owners? But what it is is, I think, most rookie franchise investors. They are not prepared for the first 18 months and what that looks like. Like a lot of the folks you're dealing with. They're bigger investors. They get it. You got to invest, invest, invest. But I think where a lot of franchisees go wrong is not understanding that six months in, you're going to feel a little pain as you keep investing into business and you're learning a business, and that doesn't mean it's a bad business. It just means it's not going to be a straight line, and I'd wondered what your thoughts on this subject were in terms of advice for new franchise owners and maybe how to get pushed through the first 12 to 18 months.
Speaker 3:Yeah. So we make these models for all of our franchisees. We can't give them to them until they're a franchisee because of the disclosure laws, but once they're a franchisee, we actually lay all that out. And one thing that is very important is that you have to separate your CapEx from your operating right, because so many times as you're building your franchise, the day that you open for business, you still have bills coming and people, if you're not I mean if you're not careful people will be running the business out of the same checkbook and even though, like I go back to restaurant parlance, we'd have restaurants with lines out the door in their first couple of weeks and franchisees still claiming that they're not making any money and you're like how can you not be making money? You're doing record sales. They're like I don't know. I went to my checkbook and there's no money in it. It's because every two weeks they got to make payroll out of the same account. The general contractor is still asking for his bills and they got all you know. So one of the first things that you can do. It's so psychological. What you tapped into is so psychological is that a franchisee has to separate CapEx, what it costs to open the business and then what it costs to like, what the P&L of running the business is, and like anything else, if you're opening up a brand new concept in a brand new market, you have to over market right. You got to staff for the sales that you want, you got to staff for the company you're trying to build and you got to know you're going to have turnover, no matter all of our businesses, not everyone that we hire stays. And so if you're, if we're, as franchisees, trying to get from here to there and you know that there's going to be turnover, right, it's like you have to factor all that into a model. So we actually make the model for a franchisee, we sit them down and we show them, depending on what your sales are. Here's going to be your cost and if you're going to have, let's factor in some turnover, let's factor in some customers that get pissed off early on. We kind of roll all that in there and, like anything else, we keep the franchisee focused on the third year, because after the third year, when they open two and three units, that's when your franchise company is really a company.
Speaker 3:When you open one, no matter what the territory you bought, when you open one, you still have one. You buy yourself kind of a job. Even if you have a team, you're still hands-on making sure it works. The second one's even harder because you can't be in two places at the same time and unless your first team can handle, the place lights out. It's a little wonky when it gets to three and on now it's functioning like a company and it's a lot more fun. So we do a lot of financial modeling.
Speaker 3:We mentor franchisees with other franchisees, like our franchisees that have already gotten to that level, even if it's a different brand, so like a brand new concept, like a Glow 30 or skincare, they might mentor from some of our other big franchisees of other brands who've already gotten past that point, because you want them to be influenced enough to stay with it until it hits that critical mass, until it hits that peak.
Speaker 3:But it's like anything else. I see it all the time. People sign up for five or 10 or 20 unit territories, pay all this money they even spend no expense building the first location and then they wind up staffing for just the right amount of staff in their location and they don't factor turnover, and so all of a sudden they're underwater, which means that now they're in the weeds and they're looking around and they're like I'm not making any money. This is not what I signed up for. It's like it's cause he didn't do it, right, right, so, like one of the best things that you can do is pair those first timers up with experienced multi-unit plus 10 unit franchisees and let them sort of build like a peer new peer group out of that.
Speaker 1:We've learned that lesson the hard way always be hiring and you know, Dan, I knew it right Like from my my home care days, right, that was always one of the things we coached our clients on is always be hiring caregivers right. Try and have two available caregivers for every one client on your roster. And then we get to pinks and it's like, okay, we've got this great team, we're good and we can turn off the indeed, ad wrong. The minute you turn that thing off, you need to. You get a big job that comes and you need two new guys and so someone leaves, like there's always something yeah there's.
Speaker 3:Imagine you guys get a job and then you don't have people for it. It's like that's the chicken or the egg, right? So?
Speaker 2:you always have a lot of people and not as many jobs.
Speaker 1:So it's, you know it's a fun little dance, but we were just having this conversation with a friend of ours locally who owns a um, a non uh franchise restaurant, and my comment to him was you have so much staff, how do you guys make money? There's more hostesses and servers in that place than I've ever seen, and it's great steakhouse here locally. And he's like because if I don't you know, two, three of these people are going to quit one night. So we've got to make sure we have enough staff. So that's great advice, dan. Okay.
Speaker 1:So, um, to kind of close out the the podcast, let's, let's segue to swing bays, which is why I wanted to get you on the podcast. So this is a new golf related um franchise that I've seen Dan kind of talking and promoting about. So we got on the phone the other day and we talked about it and I'm like you've got to bring this to our network because I just think it's when we look at the target audience, when we look at what the actual franchise concept is itself, dan, this is another thing. You know, it's like right now there's a lot of home services, there's a lot of things like that, but this is a new sort of entry into home, into non-food franchising, that I think some people can kind of get their passion but also can make a great investment in. So I'll throw it over to you.
Speaker 3:Yeah, so I was looking. Golf is the favorite thing for me, it's my sport. I do it with my family, my dad Fortunately I still can play golf with my dad and my son and I mean I just love golf, I love everything about golf and and I want to figure out how to make a lot of money in golf. Right, there's not been a lot of options for making a lot of money in golf, especially if you don't have a lot of money. But I was looking in this space for a while and it started originally because of fitness. So when I was thinking about fitness brands, you know if you go to a big gym, they have rowing or they have yoga or hot yoga or whatever. They have all those components. But then you also see rowing franchises, hot yoga franchises, and I said somebody is going to figure out golf fitness. So golf fitness is designed to sort of make you stronger, more flexible, hit the ball further. It's basically working out in a context of making you a better golfer. I said someone's going to figure this out. Titleist did. They came up with a golf program where they certify people. I said someone's going to make a business out of this.
Speaker 3:And as I was looking around the space I'm like I didn't really see anybody doing it. And then I started to see some of these indoor golf like swing bays opening up and really I looked at the competitive landscape. I was going all over the country for this and I would look. On the one end you have these empty 24-hour places where you just show your barcode and it lets you into the door, but those are intentionally meant to be empty. When you get there which feels funny to me you just go in there and hit balls. You're not really getting any better. On the other end of the spectrum you have all these entertainment guys trying to go after Topgolf and spending five, 10 million plus dollars of CapEx. I said, screw that, that's not going to work for franchising. I said someone's got to figure out how to build one of these things for four or $500,000 where you can actually make really good money.
Speaker 3:And I told a friend of mine. I said here's what I'm looking for. I want to find something that's like the orange theory of golf and and I said it's going to have golf fitness and golf instruction and it's all around this idea of I'm going to play better golf longer. I want to play better golf longer. I want it to measure me, I want it to you know, track my, my scores, my flexibility, my swing speed, all this stuff. Like I want to play better golf longer because I got the perfect guy, I got the perfect concept right by me, right? I hear that every day Someone tells me about another brand. Most of them are garbage and so I didn't have a lot of hope. But I liked the kid so I said okay, let me set up a phone call and I talked to the guy and he explained his concept and I said I think that this is what I'm looking for and I got in my little plane, went over, checked them out a couple of weeks later it's exactly what I'm looking for. So you know, want to figure out how to have a golf brand that's easy to operate and something that can make so much money.
Speaker 3:Franchisees want to open up more right my whole compounding theory and I found it. So this guy it's you guy. It's basically got tons of sticky to it. It's got. I mean it's a membership-based indoor golf fitness and instruction business. I think he spent three or $400,000 to open let's assume a franchisee spends five right and so it's doing almost a million dollars in sales. And you got to remember there's no food cost in this business, right? So there's no food cost and even your labor. You got one, maybe two staffers that aren't commission-based, so the other ones, the fitness instructors, all work on. Basically they're hired like any other fitness instructor and a golf instructor are all basically paid to do golf instructions. Well, golf instructors like it better because it's a safer environment.
Speaker 3:I actually had a lesson Friday here in Arizona and I walked up and my instructor is he had a bandaid on his eyebrow and one on his cheek where he had like skin cancer removed. Like that's terrible and it's like that's how the guy's making a living. He's standing outside in the fricking, sweltering heat of Arizona. If you've ever been here, I know what I'm talking about, but he's, you know, and he stands up for eight hours, 10 hours a day trying to give lessons and it's like you know. So, anyways, I think that this guy's created a really good concept. He's got one open in Parker, near Denver. He's opening two more, so we'll have three before you know it. I'm going to bring it to Arizona. So it's another one. Right, you had mentioned you guys investing.
Speaker 3:I'm a franchisee of Glow. I'm going to be a franchisee of Swing Bays but I like it. It's one of these concepts that are about 5,000 feet and the spaces that we're looking at landlords are giving big TI incentives. I think that just because they want this kind of a use in their center. But I think he's figured out the model of profitability where so many of these other people just haven't figured that out.
Speaker 3:The first ones I was mentioning the empty ones, where you can go in 24 hours. I've had two people already email me and see if we wanted to take over their space because they spent all this money to open it. It's got one bay or two bays. They can't figure out how to keep members. People will come try it but then they don't stay and part of it is because there's no community. It doesn't feel good going there and, other than hitting balls, you don't really. You're not really getting any better. So this is the kind of place where you're a member. They really they use AI to sort of track your swing and your flexibility and all this other kind of stuff. So it's really pretty cool and you know, but it's going to be. I think it's going to be one of my favorite things I've ever worked on.
Speaker 1:Yeah, we're really excited about it. I mean, I think it's um, I think it's kind of got it all in terms of what someone might be looking for in an investment that's different, and, uh, looking forward to to working with you guys and sending you some great, uh potential franchise owners to consider for this brand. But, Dan, this has all been really great stuff and we appreciate the, the friendship with you and the partnership with you, and I guess what I would just say is is there anything else that you want to talk about on the podcast that you think is important for people to know about?
Speaker 3:No, I know I think we covered a lot. There's a lot to talk about and I enjoy following you guys because you guys have the same attitude I have about this space. So I like following you guys. I'm glad we're connected.
Speaker 1:Hopefully see you in a couple of weeks when I'm in Florida. So yeah, hopefully it won't be as sweltering down here when you get here.
Speaker 2:Well, that's it. The indoor golf. It's the same thing here. You know, there's days it's just uncomfortable to be out there, so yeah love that?
Speaker 1:Yeah, exactly no, and I think, dan, you know you always have been. We've always talked about, you know, on social media. Jill and I share a lot of our lifestyle and the freedom that franchise ownership affords, and that's always been. My point to people is is that there's all kinds of people out there that share what business ownership is, and I think it's now more than ever before you get exposed to so many different sides. For us, it's always been freedom. It's always been the ability to travel, to spend more time with family and to have the means to do it. But to get there you got to make some sacrifices. Those first few years and that's the point of this podcast is to help people see that that's what it is. It's investing in yourself and investing in your business and, dan, you invest in the franchise community in so many ways, so we appreciate you.
Speaker 3:Yeah, no, it's worth it. So it's worth it All right. Well, if I can ever help with anything, let me know.
Speaker 1:You got it, Dan. Thanks for joining us on the we Bought a Franchise podcast. Take care.
Speaker 2:Thanks, bye, dan, thank you.