Jon Ostenson is a top 1% Franchise Broker, Owner/Investor, and Author of the book ‘Non-Food Franchising’. He draws on his experience as a former Inc. 500 Franchise President and Multi-Brand Franchisee in serving his clients. He is a frequent contributor on Franchising for Forbes, Inc., and The Franchise Journal.
FranbridgeConsulting.com – Sign up to receive a free copy of Jon’s new book, Non-food Franchising!
3 Value Bombs
1) We’ve never seen so much interest in business ownership and alternative investment opportunities as we’ve seen over the past two to three years – and it’s only getting stronger. It really is across the board.
2) These non-food businesses, they’re cash flowing, they’re Amazon resistant, and in many cases they’re pandemic resistant or recession resistant. That’s what’s attracting people.
3) A lot of businesses in different industries are getting into franchising and finding there are a lot of benefits to scaling through that path; it’s certainly not right for everyone, but for a lot of businesses, it is.
**Click the time stamp to jump directly to that point in the episode.
Today’s Audio MASTERCLASS: Non-Food’ Franchising is En Fuego
[1:25] – Jon shares something that he believes about becoming successful that most people disagree with.
- A key element oftentimes overlooked is that in the end, it’s not about you. Others have been a part of your success, but what really matters is their own success as a result of having interacted with you.
[3:50] – Jon talks about his book Non-food Franchising
- Many don’t consider franchising when they’re thinking about business ownership and alternative investments. They chunk franchising up as fast food, and yet 90% of probably 95% of our clients want nothing to do with food.
- In the book, they talked about the nuts and bolts of stepping into business ownership.
- They also talk about the legal side and how to select a franchise.
[6:22] – The reason why franchises are often a stronger option than just plain old startups or “entrepreneurship through acquisitions.”
- There are a lot of positives when it comes to buying an existing business. Its cash flow, there’s brand awareness, and you have a team in place.
- As a franchise owners, you’re on third base instead of first base. You know there’s a proven path to profitability.
- You’ve got the playbook to your business.
- You have large data sets for marketing.
[10:12] – Jon talks about what types of businesses those in Fire Nation are actually buying and running right now.
- They just closed the deal for a dentist in Orange County.
- There is a small business owner in Florida who expanded his portfolio with a non-medical drug testing business.
- A professor at the University of Arkansas purchased a large fitness business.
- A Wall Street attorney outside of Boston bought into a gutter business and is absolutely thriving. He actually is running the business himself, and he had no background in that space.
[13:17] – A timeout to thank our sponsors!
- Thrivetime Show: Is this your year? Visit ThrivetimeShow.com/eofire to see how Clay Clark’s business coaching has helped thousands of entrepreneurs to dramatically increase profitability!
- HubSpot: Learn how HubSpot can help your business grow better at HubSpot.com.
[14:25] – Running the day-to-day operations of a new venture versus hiring a management team to run it.
- Roughly 2/3 of the clients are going with the executive model or semi-passive.
- They still invest time in the business. It’s not totally passive, but they’re able to put a manager in place day one.
- There’s an increase in the executive model, where people want to keep their day job or maybe they want to keep focused on their current business that they own.
[18:56] – The highlights of and organization called All Things Franchising.
- The idea of franchising a business is not on a lot of people’s radar because they don’t think their business is franchise-able.
- A lot of businesses in different industries are getting into franchising and finding there are a lot of benefits to scaling through that path; it’s certainly not right for everyone, but for a lot of businesses, it is.
- Firms are out there looking for that next big thing. There’s also this intangible benefit that here you are, you’re creating a system, you’re helping others get into business ownership, and then you’re creating jobs and doing good for communities.
[21:23] – Jon’s key take away and call to action.
- We’ve never seen so much interest in business ownership and alternative investment opportunities as we’ve seen over the past two to three years – and it’s only getting stronger. It really is across the board.
- FranbridgeConsulting.com – Sign up to receive a free copy of Jon’s new book, Non-food Franchising!
[22:57] – Thank you to our Sponsors!
- Thrivetime Show: Is this your year? Visit ThrivetimeShow.com/eofire to see how Clay Clark’s business coaching has helped thousands of entrepreneurs to dramatically increase profitability!
- HubSpot: Learn how HubSpot can help your business grow better at HubSpot.com.
Light that spark, Fire Nation. JLD here and welcome to Entrepreneurs On Fire brought to you by the HubSpot Podcast Network with great shows like Success Story Podcast. Today, we'll be breaking down why non-food franchising is En Fuego. To drop these value bombs, I brought Jon Ostenson into EOFire Studios. Jon is a top 1% franchise broker, owner, investor, and author of the book 'Non-Food Franchising'. He draws in his experience as a former Inc. 500 Franchise President and Multi-Brand Franchisee and serving his clients. He is a frequent contributor on Franchising for Forbes, Inc., and The Franchise Journal. In today, Fire Nation we're gonna talk about non-food franchising, the reasons why franchises are a great option for entrepreneurs like you, Fire Nation and so much more.
And a big thank you for sponsoring today's episode goes to Jon and our sponsors. Is this your year? Visit Thrivetimeshow.com/eofire to see how Clay Clark's business coaching has helped thousands of entrepreneurs to dramatically increase profitability. It's month to month and less money than an average minimum wage employee. Schedule your free consultation today at thrivetimeshow.com/eofire . Success story hosted by Scott D. Clarey is brought to you by the HubSpot Podcast Network, the audio destination for business professionals success story features Q and A, keynote presentations and convos on sales marketing and more. A recent episode on how to protect your business in times of crisis is a must.
0 (1m 34s):
Listen, listen to success story wherever you get your podcasts. Jon, say What's up to Fire Nation and share something that you believe about becoming successful that most people disagree with.
1 (1m 49s):
Hey, fire Nation, great to be back and I wanna start off by saying, Jon, congrats on the 10 anniversary here. Thank you. It's very exciting. So keep rocking. As far as something around being successful, you know, I believe a key element oftentimes overlooked is that in the end it's not about you. Others have been a part of your success. Yes. But what really matters is their own success as a result of having interacted with you. And you know, for example, this past week I was taking my son to Columbia, South Carolina for my alma maters football game, the National Champion Georgia Bulldogs. And I happen to have five clients in Columbia, South Carolina that have bought franchises in the past year or two.
1 (2m 33s):
And we took them all to dinner Friday night and sitting around the table and hearing of their successes and they're not just growing, they're thriving and expanding and taking over the state. It is so rewarding. That's where I get my fulfillment and it's just a great reminder to me that it's not about us, it's about
0 (2m 48s):
Them. I love that. And I also love how you snuck in National Champion. I mean I have so much pride in my alma mater as well. Providence College. We don't have a football team unfortunately cause that's always a fun thing. But you know, we won the Big Big East last year. We went to the Sweet 16 where I was at where we barely lost to the eventual champion Kansas by just a couple points. So definitely love sticking with the Alma maters, having fun with that. And as Jon mentioned Fire Nation, this is his third time on the show, which is really cool. And we're gonna be talking about why non-food franchising is in Fugo. And during our pre-interview chat, Jon and I actually had some cool conversations around how so many of you Fire Nation our listeners, my listeners here, how you have taken action on this content.
0 (3m 31s):
How you've reached out to Jon and his company and you started non-food franchising companies and a lot of you even said, Hey, I didn't even know this thing existed and now I'm running this non-food franchise and I'm having a blast. Like I never was really able to click with anything else but this is clicking with me. So we're gonna be talking about some really cool things all around these topics and I hope you fire Nation keep taking advantage of the amazing opportunity that Jon gives you at the end of this episode to connect with him and his company for these non-food franchising opportunities. So first off, Jon, congrats on your new book Non-Food Franchising. You're seeing a theme here at Fire Nation.
0 (4m 11s):
Tell us more about it.
1 (4m 12s):
Yeah, no I appreciate it. The, the book releases at the end of October and we've got a great response already with pre signups. As I mentioned off offline. We'll get a copy to every one of your listeners that reaches out to us. But as we've discussed in the past, you know with non-food franchising, many don't consider franchising when they're thinking about business ownership and alternative investments. They chunk franchising up as fast food and yet 90% of probably 95% of our clients want nothing to do with food. They just feel the same way that I do, that there are easier ways to make money. I'm happy to get into more detail around that, but no, so it's really opening up their eyes. And in the book, you know we talk about the nuts and bolts of stepping into business ownership. What does that look like?
1 (4m 53s):
We compare franchising to startups, franchising to entrepreneurship through acquisition, which is a popular concept out there. We talk about the different roles of the owner, both the owner operator as well as the semi passive executive model that many of our clients opt for. We talk about the different types of opportunities in various industries out there and we certainly get into the financials, both the funding and the expected returns. And you know, this is oftentimes eye opening for people when they see that ROI that can be produced. We certainly talk about the legal side as well and and kind of how to navigate that piece. And then we talk about how to select a franchise. You know, as you can imagine, if you just Google around online, every brand is putting forward their best foot forward from a marketing standpoint.
1 (5m 34s):
But it's really important to understand what's going on behind the scenes. And as you know, we work with over 600 brands, part of the largest national brokerage here in North American. You know, at any given time there's probably 40 to 50 that we feel are the best of the best. You know those with the franchise leadership team, the financial model, the competitive advantages within their niche and then also what is resonating with others with similar backgrounds and why. And so, so we kind of bring all that together. We talk about long term strategies in the portfolio approach. A lot of our clients are existing business and they're looking to either compliment or diversify their current holdings through additional expansion. And then we have a chapters will, you know, many of your listeners have businesses that they want to scale and oftentimes they overlook the possibility of franchising those as a strategy.
1 (6m 20s):
So, you know, we cover a lot of content and again, can't wait to get it out the door.
0 (6m 23s):
Well you are gonna get it out the door brother. And as I mentioned in the beginning, a lot of my peop, the people in my audience Fire Nation didn't even really know that non-food franchising was really a thing before some of our conversations that we've had in the past. So I wanna talk about why franchises are often a stronger option than just plain old startups or entrepreneurship through acquisitions. Cuz you've experienced this firsthand. So go through a few reasons of that specifically.
1 (6m 51s):
You know, on the acquisition side, you when making that comparison, you know there are a lot of positives of buying existing business. You know, it's cash flowing and maybe there's brand awareness and you've got a team in place, but it's not oftentimes once you dig in it's not as easy as it looks. And I'd say over 90% of our clients that start off in that direction end up coming back and purchasing a franchise. It's really once they dig under the covers and they understand how do you define owner's discretionary within that p and l and you know, then they realize there's a risk to losing key employees whenever you have a manage change or you may lose key customers and, and then you're kind of in business for yourself. You know, you no longer have that support system that you would within a franchise system. So you know, we certainly deal with some resales, but most of our clients are looking to to to start fresh.
1 (7m 33s):
And on the startup side, again, there's some great startups out there, but if you look at just the success rates, I mean it's so much stronger on the franchise side and some of the reasons, and I actually put together a top 10 list in the past I referenced frequently, you know, first off franchise owners, you're, you're on third base instead of first base. You know, there's a proven path to profitability, you're not having to guess day one, will this become profitable? Instead you're just going in executing. Secondly, franchise owners know that there's product market fit. You know, there's already a market for that service and people are willing to pay for it. So you're not left guessing. Third, you've got the playbooks, you know, that we've talked about in the past, you know, around marketing and operations, you know, proven turnkey systems that you just go and execute the playbook on fourth, you know, this is oftentimes overlooked but you have large data sets around the marketing.
1 (8m 22s):
You know, you're not having to, you know, again guess on your marketing because it's been shown in other markets what works, what converts the franchises running that marketing system for you. You're able to step into a technology stack that's already been put in place. And so again, it takes some of that heavy lifting off of you that that may go overlooked. Otherwise, you know, you've gotta coach on the sidelines that franchisor, the better you do, the better they do. They're a great support to you, you know, assuming it's a good, good franchisor and franchise system. And then you also have other franchisees in other markets, you're exchanging best practices. You know, where did you find your best hires? You know, what pools did you fish in for that? What are some unique marketing vehicles you're testing? And so you really have that support system.
1 (9m 4s):
And you know, if you go all the way back to 1902 when the first franchise model launched out, there was a drugstore concept. Franchisees have always benefited from a collective buying power. You know, you've got that large quantity that's being ordered, whether it be products or whether it be services, you know, from providers out there. And so you're able to get advantageous pricing in most cases. And you know, while it doesn't totally de-risk the proposition, you know, going in with your eyes wide open on the financial side with that franchise disclosure document that's showing here how other owners and other areas are performing financially gives you much better basis for your proforma than just, you know, the back of the napkin or envelope I guesswork.
1 (9m 46s):
And then finally lastly, private equity loves franchising and you know, whether or not you sell the PE one day or you sell to an adjacent franchisee, which is very common in another location, something that we've personally done. We've bought other locations from other franchisees personally, the studies have shown that franchises traded a multiple one and a half times non franchise for like kind businesses and like Kind market. So again, the evidence that's there from a success rate as well as from AI Exit Value,
0 (10m 17s):
Fire Nation. So much great content around this topic right here. And one thing that I really wanna dive into next Jon, because we have been talking about this quite a bit thus far, is that you've helped quite a few EO fire listeners. I mean Fire Nation is right now running businesses they otherwise would not be because of your help, because if your guidance, because of your support. So let's talk about some specifics. Let's talk about their backgrounds and what type of businesses they are actually buying and running right
1 (10m 45s):
Now. Sean, this is what gets me the most excited. I mean I can give you illustration after illustration, but you know, just off the top of my head here, you know, I'll reference a few recent ones that we've had. You know, we, we just closed a deal for some dentist in Orange County, a guy and his fiance in the dentist industry. They bought into the largest Vincent Rail business in the us you know, no experience there but they loved the model, they love the franchisor. You know, it's a business that adds Home Depot as a national account. Just crazy financials. As a result of that, we had a small business owner in Florida that expanded his portfolio with a non-medical drug testing business. Fastest one in the country, strong proposition. And as you know, a lot of industries out there require ongoing drug testing.
1 (11m 25s):
So you kinda get that built in B2B pipeline. We had a professor at the University of Arkansas that purchased a large fitness business on the side. So the only, it's largest one that caters to those 15 and above in the country, which is a oftentimes overlooked demographic that more and more industries need to tap into and frankly they're underserved when it comes to fitness. We had doctors in Philadelphia that bought into a fast growing oil change business, strong financials long road ahead for that industry. Even with electric cars coming. We had a real estate broker in Atlanta that bought into a property management business, which was a great compliment to his core real estate business. A Wall Street attorney outside of Boston that bought into a gutter business and is absolutely thriving.
1 (12m 9s):
He actually is running the business himself. Again, no background in that space, but I loved everything about the opportunity. Had an engineer in Indianapolis, bought into a business coaching franchise, a doctor in Des Moines who purchased a parking lot maintenance program or business, loved their program again, ongoing B2B revenue and guys, younger sister's actually gonna run the business while he continues in his practice as a doctor had a South Carolina business owner recently purchased a dumpster business and in just a few months, I mean he is taking over the whole state just buying additional markets and just killing it. So you know, the examples go on, but as we've talked about before, I'd say the theme is these non-sexy businesses, you know, they're cash flowing, that are Amazon resistant in many cases, pandemic resistant or recession resistant.
1 (12m 57s):
That's what's attracting people, not the next trendy thing.
0 (12m 60s):
Fire nation. I hope that you are excited and that you're getting fired up by knowing that your peers, people who are listening to this podcast are going out taking action and having the type of success that Jon's talking about now. And we're gonna be talking about some really cool things around this topic when we get back from thanking our sponsors, are you ready to grow your business now? What if you could learn the proven systems and processes that have been used to grow thousands of multimillion dollar success stories at thrivetimeshow.com/eofire . See how Clay Clark's proven business coaching has helped thousands of entrepreneurs to increase profitability dramatically. Clay's proven business coaching program is month to month and less money than hiring a minimum wage employee.
0 (13m 42s):
Sound too good to be true? Go to thrivetimeshow.com/eofire to see thousands of documented client testimonials because Clay only takes on 160 clients. He personally designs your business plan for you. Then Clay's team of talented designers, videographers, web developers, workflow mappers and accounting coaches will help you implement that proven plan. See thousands of verify success stories and schedule your free one-on-one 13 point assessment with Mr. Clay Clark himself today at thrivetimeshow.com/eofire . Knowledge will not attract money unless it is organized and directed through practical plans of action. Become the next success story. Schedule your free 13 point assessment today at thrivetimeshow.com/eofire .
0 (14m 28s):
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0 (15m 9s):
A seven day trial of trends is yours for only $1 in a yearly subscription. Plus access to the community is $299 per year. Get a seven day trial of trends for only $1 at trends.co/mfm. That's trends.co/mfm. So Jon, one thing I'm curious about is the clients specifically, like are they actually running the day to day operations of their new ventures? Cause in some cases you can be like, okay, I'm gonna get this franchise but I'm gonna hire like a management team to actually run it. So are you seeing one thing that's happening more often than the other? Are they both happening at an equal basis or are most people just getting a franchise, hiring a management team and letting them run that?
0 (15m 55s):
What does that look like?
1 (15m 56s):
Yeah, you know, that's a great question. Roughly two thirds of our clients are going with executive model or semi passive as we oftentimes call it. They still invest time in the business. It's not totally passive, but they're able to put a manager in place day one. The nice thing about franchising is in this setup, the manager, it can be trained by the franchisor and the onus really isn't entirely on you to support that manager. They can also go to the franchisor and their support team with questions and and needs as well. So you're kind of tag teaming the management of the manager with that franchisor. We actually had a franchisor as leadership team in town here in Atlanta last night and you know, our operator was representing us in the meeting, but I would stop by to say hello, shake some hands and, and take a few pictures.
1 (16m 41s):
But ultimately, you know, our operator's the one that took him out to dinner afterwards and he, he was the point person. So again, he's running the business for us. You know, we've invested in him and he's done an outstanding job. You know, we've really seen an increase in the executive model in that approach where people wanna keep their day job or maybe they wanna keep focused on their current business that they own. And so something we recently did was we set up a partnership with the national recruiting firm based out of Atlanta, but works nationally that will help our clients that need support in finding that operator. So that's a common request that we heard was, hey, this all sounds great, but where do I find that operator to run the day to day? And so this firm will actually screen vet candidates and then present them for interview opportunities with our clients.
1 (17m 25s):
There's an investment to it, it's not totally free, you invest in their services but they've set up a program that I think will help a lot of our clients going forward.
0 (17m 33s):
This is really cool, stop Fire Nation. And again, what I love is that a lot of people have never heard of this. So these are things that you can say, okay, number one, I can do this non-food franchising because other people that are listening to this show have done it. They're having success. I can run the day to day, I can hire a management team or I can try a little bit of a hybrid model. Like there's some really cool things around this topic that I really love that you foundation can take action on, can learn more about. And you recently, Jon did a video series for Global Entrepreneurs Organization on all things franchising because you are one of, if not the go-to expert on this topic. So talk about some of the highlights that can maybe really help our listeners today.
1 (18m 12s):
Yeah, you know, we covered a lot of ground on, you know, topics such as ones we've covered in previous episodes where we get into the nuts and bolts, you know, here on Entrepreneurs On Fire, which I would encourage everyone to go back and listen to. You know, we, we've got a great response, you know, on the education that we provided previously. But one topic that we go into in a little more detail here is the idea of franchising your business. You know, a lot of times people don't have that on their radar as a possibility cause they don't think their business is franchisable and yet the models that we see coming down the chute and we're always keeping our eyes out around the country, a lot of businesses in different industries are getting into franchising and finding there's just a lot of benefits to to scaling through that path and you know, it's certainly not right for everyone, but for a lot of businesses it is.
1 (18m 55s):
You know, in a nutshell, franchising allows you as the business owner and soon to be franchisor, you know, the ability to off time scale rapidly, you know, using others funding. You know, you have owners with skin in the game that know their local market and are really aligned in their motivations. You're able to again, buy in bulk and you know, both intangible as well as tangible items. And then there's also an intangible benefit, you know, that it goes beyond, you know, I mentioned private equity loving franchising and there's so many acquisitions and investment happening from private equity, typically the franchisor level today. We just have conversations multiple times a week with firms out there looking for that next big thing. But there's also this intangible benefit that here you are, you're creating a system, you're helping others get into business ownership and then you're, you know, ultimately they're creating jobs and doing good for their communities.
1 (19m 45s):
So there's a huge rewarding piece behind this as well and really making it that one to mini type opportunity. So yeah, no that, that's one thing that I'd say outside of what we've covered on previous episodes that we dig into in that video series. And if any of your listeners, anyone from Fire Nation like to watch that video series, I'd be happy to share it with them. Just reach out.
0 (20m 5s):
Well I have no doubt that Fire Nation's gonna want to consume that content because people that take action listen to Entrepreneurs on Fire and are part of Fire Nations. So that's really exciting. And Jon, I wanna give over to you for closing thoughts. Like of everything we talked about here today about how non-food franchising is literally En Fuego, that means on Fire, Fire Nation. Let's hear what you have as a final call to action, your final closing thoughts, and then a call to action where Fire Nation can connect with you, with your team and then we'll say goodbye,
1 (20m 38s):
Jon. So good to be back with you again today. Appreciate you having, having me back on. As I shared last time, you know, we have never seen so much interest in business ownership and alternative investment opportunities as we've seen over the past two to three years. And, and it's only getting stronger. It, it really is across the, across the board. I mean we're still doing deals in California and New York, the state of Washington last week, you know, areas that aren't getting a lot of positive news from an economy standpoint. People are still saying, hey, it's what's going on on the ground that matters. So, you know, keep that in mind. But yeah, as a first step in learning more, I would encourage everyone to visit our website for FranbridgeConsulting.com, which will be in the show notes, sign up for a complimentary copy of our new book Non-Food Franchising.
1 (21m 19s):
It's releasing here in the next few weeks. I think you'll be very educational and enlightening, you know, for many of you. And then, you know, if you'd like to take a second step, you know, let's get on call and you know, chat more about your setup and what you're looking to do. And we would be more than happy to help. And as we've shared in the past, our service is a hundred percent free. We are funded by the franchise brands, nothing gets passed onto our clients in any way. So it really is a no brainer if this scenario of Interest
0 (21m 44s):
Fire Nation, I love this topic, I love this content, I love that we had case studies and success stories to talk about on this episode cuz you're the average of the five people you spend the most time with and you've been hanging out with JO and JLD today. So please keep up that heat. Head over to efi.com type Jon, J O N and the search bar page will pop up with everything that we've talked about here today. And Jon, one more time, give us that direct call to action for Fire Nation who has their fingers at the ready.
1 (22m 17s):
Come out to FranbridgeConsulting.com. There will be a popup sign up for our monthly newsletter. We put out great content and we'll make sure that you receive a copy of our book when it's released here shortly.
0 (22m 27s):
Jon, thank you for sharing your truth, your knowledge, your value of Fire Nation today. For that we salute you and we'll catch you on the flip side. Hey, fire Nation, a huge thank you to our sponsors and Jon for sponsoring today's episode, Fire Nation. Are you ready to rock your very own podcast? Check out our free podcasting course where I will teach you how to create and launch your podcast for free. freepodcastcourse.com. freepodcastcourse.com. I'll catch you there or I'll catch you on the flip side. Is this your year? Visit Thrivetimeshow.com/eofire to see how Clay Clark's business coaching has helped thousands of entrepreneurs to dramatically increase profitability.
0 (23m 8s):
It's month to month and less money than an average minimum wage employee Schedule your free consultation today at thrivetimeshow.com/eofire . Success story hosted by Scott D. Clarey is brought to you by the HubSpot Podcast Network, the audio destination for business professionals success story features Q and A, keynote presentations and convos on sales marketing in more. A recent episode on how to protect your business in times of crisis is a must. Listen, listen to success story wherever you get your podcasts.
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