Hey Empire Builders,
Welcome to this week’s Franchise Empire Newsletter, where we share specific franchise opportunities that we think are interesting, and examples of everyday folks building their empires.
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I just wanted to send my prayers to all of the families and people impacted by the recent hurricanes and devastation they’ve caused.
It’s so easy to take the most basic things in life for granted. Like food, water and shelter.
God Bless
– Tariq
CEO & Founder, Franchise Empire
Today, in 5 minutes or less:
✔ B2B biz with $1.37M Average sales
✔ Resale with $137k of Cash Flow in South Carolina
✔ Franchise Buyers move out of state to buy franchise
✔ Tech employee quits job with no plan, and then buys this franchise
Join Our Franchise Buyers Beta Course for
Aspiring Franchise Owners
FEATURED RESALE
Franchise resales possess many benefits for aspiring business owners – established cash flow, experienced employees, systems in place, and brand awareness to name a few.
This week, our featured resale comes from CertaPro Painters. Established in 1992, CertaPro has nearly 500 franchise units throughout the United States and Canada. They are the largest residential and commercial painting franchise in North America. Entrepreneur Magazine ranks the franchise #1 overall in the home services industry.
Hilton Head, SC:
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Started in 2012
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Asking price of $655,000
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Last 12 months revenue of $1.2M
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Cash flow of $137,000
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2-territories included
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Assets and team information provided upon request
Franchise Empire’s Take:
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The CertaPro franchise system boasts a strong Item 19. According to the most recent FDD, the AUV for franchise locations open at least one year is $2.08 million. This location has been open for 12 years, and is doing roughly half of the AUV, so there appears to be a significant opportunity to grow upon a solid foundation.
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CertaPro is one of the strongest home services franchises in the industry. They have a strong, hands-on training (five weeks) and support program for their zees, leading to a 90%+ retention rate amongst their network over the past 3 years.
Curious to learn more about this particular franchise resale, or other resales available in your area?
CLIENT CASE STUDY
Ryan was a Program Manager at a large educational software company.
He was very successful in his corporate career, but knew the time was now for him to invest in himself and try to build a business.
Our team went out and found some franchise options that aligned with Ryan’s goals.
He then narrowed in on two great franchise opportunities – one in the HVAC industry and one in the garage door industry. Ultimately, he decided a Garage installation and service franchise was a great opportunity for him and his wife, so much so they relocated to a different city to start the business in an open territory.
P.S. Ryan originally came to us only wanting resales. When he saw the opportunity of what was available with some new territory options, he pivoted and went that direction instead.
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FRANCHISE OF THE WEEK
History:
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Original location started in Tucson, AZ in 1970.
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Merged with AGIT in 1986.
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Started offering franchises in 1992.
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USBH is the parent company.
Numbers:
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Corporate Owned Territories: 0
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Franchise Units: 232
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Franchise Fee: $49,750
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Royalty: 7%-3%
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National Marketing Fee: 2.5% but capped at $22,060/yr
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Total Investment Range: $291,289 – $374,189
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Term: 10 years
**Numbers according to their FDD released on April 25, 2024.
Description:
AlphaGraphics is a B2B print, sign, and marketing franchise offering digital and visual communications solutions. The products and services produced by an AlphaGraphics Business Center may include: multi-channel marketing campaigns, brand identity, and awareness solutions, graphic design, offset and digital printing, bindery, mailing and fulfillment, direct mail, large format graphics, traditional signage and point of purchase, vehicle wraps, promotional products, packaging, e-commerce, digital marketing, and other marketing communications services. A typical location is less than 2,000 sq ft and can be started with just a few employees. Sales skills are crucial for the success of an AlphaGraphics so the owner must be great at this or hire a FT sales representative.
Financial Data:
Below tables taken from the AlphaGraphics 2024 Franchise Disclosure Document – Item 19, page 71.
Table 19-2: Annual Gross Sales for Business Centers Operating in Calendar Year 2023
Table 19-2 below lists the annual Gross Sales information reported for calendar year 2023 by our franchised Business Centers that (i) have been in operation in the United States for 1 year or more as of December 31, 2023—that is, Business Centers that first opened before January 1, 2023 and were still open as of December 31, 2023, and (ii) submitted all required sales reports regarding 2023 (“Reporting Criteria”). It excludes data from: (i) 7 Business Centers that were terminated or permanently closed during calendar year 2023 (of those, 0 franchised Business Centers closed in 2023 after being open for less than 12 months); and (ii) 2 Business Centers that opened in 2023 and thus was not in operation for all of the 2023 calendar year. As of December 31, 2023, we had 232 Business Centers open and operating in the United States; of those, 226 Business Centers met the Reporting Criteria.
Notes to Table 19-2:
1. Of the 226 Business Centers included in Table 19-2, 84 (37%) met or exceeded the average annual Gross Sales of the Business Centers for calendar year 2023. The range of annual Gross Sales for all Business Centers was $119,895 (lowest) to $9,085,732 (highest) in 2023.
2. The average 2023 annual Gross Sales for the Top 25% Business Centers was $2,977,914. Of the 56 Business Centers included in the Top 25%, 17 (30%) met or exceeded the average annual Gross Sales of the Top 25% Business Centers for calendar year 2023. The range of 2023 annual Gross Sales for the Top 25% Business Centers was $1,647,899 (lowest) to $9,085,732 (highest).
3. The average 2023 annual Gross Sales for the Lowest 25% Business Centers was $442,243. Of the 57 Business Centers included in the Lowest 25%, 30 (53%) met or exceeded the average annual Gross Sales of the Lowest 25% Business Centers for calendar year 2023. The range of 2023 annual Gross Sales for the Lowest 25% Business Centers was $119,895 (lowest) to $641,935(highest).
Table 19-3: Certain Information for Business Centers for Calendar Year 2023
Table 19-3 below describes certain cost and expense information as a percentage of Gross Sales for franchisees operating a U.S. Business Center during 2023. There are a total of 150 Business Centers included in Table 19-3 below for Calendar Year 2023, which represents all Business Centers that met the Reporting Criteria (as defined above) as of December 31, 2023, excluding 77 Business Centers that did not provide any/complete expense data.
Benefits for the Franchisee:
- Competitive Edge – Most sign companies do not offer digital solutions for their customers and only focus on physical assets for a business. Alphagraphics provides social media, webpages, landing pages, targeted direct mail campaigns, online marketing, analytics and tracking, and dimensional marketing so they are able to help with ALL aspects of promotion.
- Work-Life Balance – since this is strictly all B2B business and is done during M-F, 8-5 hours giving you more time to spend doing what you want on weekends/evenings.
- Stable – The need for these services and products are across ALL industry types, so you aren’t affected by a dip in any particular industry or season.
- Loyal Customers – With this type of business you only need about 20-30 loyal customers who will provide you with about 80% of your work. They will come back to you for more projects, some of which are recurring – providing you with a more stable cash flow.
- Extremely High Margins – The average Gross Margin across all centers is 71.7%. This is higher than the typical franchise.
To see if this franchise is available in your territory
OR
Check the availability of ALL franchises in your area
Episode #74: Tech Employee Quits her Job to Open Her Dream Business
Tasneem was working in the tech industry in the Bay area.
She saw thousands of employees getting laid off in her industry and saw the writing on the wall. So she decided to take action.
Franchising had always been in the back of her mind, she liked the idea of having her own business but not being entirely on her own.
She quickly made a decision to work with our team and took massive action. She quickly found the perfect serviced based franchise that complimented her background and skill set.
This is a great listen for anyone considering buying a franchise or transitioning from employee to entrepreneur.
Sit back, relax, and enjoy the show.
That’s a wrap for this week’s Franchise Empire newsletter.
Feel free to reply with any questions, or feedback. I appreciate and value your time and attention.
I’ll see you at the same time next week!
-Tariq and The Franchise Empire Team