Adam Povlitz

THOuGHTS ON

micro-franchising for the new year

Adam Povlitz is CEO & President of Anago Cleaning Systems, one of the world’s leading franchised commercial cleaning companies and a leader in technological advances relating to business operations and janitorial services. A previous IBM executive, Adam holds several business degrees and certifications, including an MBA in Marketing and Finance from the University of Miami. He is a Lean Six Sigma Green Belt, an IFA Certified Franchise Executive, and an ISSA Cleaning Industry Management Certification Expert.

Originally, micro-franchising was a term used to mimic concepts of traditional franchising models but geared toward smaller-sized, pop-up or concession-style business models.

Around the world, micro-franchising is gaining significant attention, especially as small business opportunities become attractive options for first-time entrepreneurs. The global pandemic created a new breed of entrepreneurs who are looking for more control over their finances. Examples of micro-franchising can be found in many industries, including food and beverage, retail kiosks, athome healthcare, and janitorial services. Micro-franchising can also describe small business franchising that can be operated from your home or car.

the covid-inspired gig economy

The pandemic, though horrible, gave many a new definition of work/life balance that is jeopardized by returning to the way corporate jobs used to operate. The other factor at play is the continuing rise of the “gig-economy” that surged during the pandemic. Working from home or ondemand, many people were able to seek side-gig work they found more interesting, more satisfying, and/or eliminated the traditional feel of corporate life. This also gave more power to the individual to carve out their own definition of work/ life balance. In many cases, this translated to people seeking more freedom in their career path and micro-franchising opportunities became an attractive offer.

be bold

One of the most important aspects to consider if you are making the jump into franchise ownership to think big—even if you’re starting small. The nature of microfranchising is to start small by offering a product or service in your market’s high-traffic areas. And just because the business starts out small doesn’t mean you have to stay small. Push your boundaries safely and with the proper calculation. Some of the most profitable companies in the world started at the micro-level and

grew into much more. As your product or service resonates with customers, more opportunities for growth will present themselves if you think big when starting a small business. When finding the right micro-franchise opportunity, pay close attention to the fees involved, especially if buying into a well-known brand. Some franchisors will offer low upfront costs but as a tradeoff, may end up taking a larger percentage of your ongoing revenue, so it’s best to conduct due diligence when researching. Also, be critical of barriers to entry and make sure you are asking for a detailed account of all cost structures – both upfront and any ongoing monthly, quarterly, and yearly fees. You will find that as a budding entrepreneur, you can become a micro-franchisee within a proven, successful business for a minimal investment without paying high upfront costs.

“As your micro-franchise operation grows, explore ways to re-invest your profits in areas that give you a reasonable probability of growth.”

consider the long-term scalability

The best entrepreneurs in the world spend a considerable amount of time planning for scalability. As your micro-franchise operation grows, explore ways to reinvest your profits in areas that give you a reasonable probability of growth. There are many examples of this including increasing a consumer product offering or expanding your customer base. Making smart, calculated investments back into your business model will allow longterm scalability. Commercial cleaning franchising offers a perfect example of scalability. When you first start out running your commercial cleaning business from your home (or out of your car), you can start with a specified number of contracts. As you become more experienced in delivering excellent customer service on time (while maintaining brand integrity), you have the option of adding more contracts, thereby increasing your revenues. As you add more contracts, you can start thinking about growing your staff. This is an excellent way for you to generate more frequent revenue streams and become a job creator within your community. Once you’ve reached this level, more opportunities open, and expansion seems more and more likely.

be unique: think outside the box

There are many different micro-franchise concepts available, and several franchise brands have done most of the upfront work for you. They have a franchise development structure in place that is based on years of research and experience to help entrepreneurs leap into small business ownership. But don’t always rely on others. Do your own research! Don’t count on the franchisor to provide you with an analysis of your market. Do it yourself. Check out your competition. Is your idea already out there? Is your market saturated? What market share do competitors have? Are they successful? What are you providing that they don’t already? Can you compete with their cost offerings? These are just a few examples of the types of questions you will want to bring to the table when you meet with a prospective brand. Think outside the traditional means of small businesses and find an industry trending upward within your community, city, or state. This process goes hand in hand when thinking about scalability, so you will want to spend extra time outlining this segment of your journey into small business franchise ownership.

imagine Who your clients Will be

A niche’ luxury product or high-end service will only target a small percentage of people. Consider franchises that offer immediate or relevant necessities and services to help safeguard your client base. For example, the food and beverage franchise industry is highly competitive because people need to eat to survive. On the other hand, if you create a product that is not necessary to everyday life, doesn’t solve an existing problem, or isn’t attractive or entertaining, it will likely fail. You must think like a consumer. Imagine who your clients will be and why they will benefit from your product or service when thinking about your business.

Micro-franchising can be just as successful of a venture as traditional franchising, and in some cases better. As with any business, believing in yourself and your product or service will make all the difference. Be bold and stay the course. If choosing to invest in an established franchise, be prepared, conduct due diligence, and research and make sure you fully understand the brand’s franchise programs. Whatever you decide, have fun, and let your entrepreneurial spirit fly.