Let’s Talk Franchising!

Fun business moderate investment Fun Bus

Author: Jim Coen
April 5, 2007
Category: Franchising in general, I'd consider it!

One of the franchise opportunities that I thought was interesting at the IFE last week was the Fun Bus.

The cornerstone of the Fun Bus franchise is a full-sized and fully operational school bus whose seats have been removed and replaced with a padded playground ideal for children ages 2 to 7. The bus features a trampoline, a rope swing, a punching bag, a parallel bar, a basketball net and a big slide that is attached out the back. The bright green school bus brings fitness and fun directly to children at daycare, nursery schools and birthday parties.

The Fun Bus visits daycares and nursery schools once a week for a 10-week session, giving the children 30 minutes of learning and fitness taught in a fun way.

What I find appealing about the opportunity is there is no real estate involved, it’s an easy business to operate and it acts as its own billboard as it drives around town.

The investment is moderate: franchise fee is $25,000 fee, franchisees get the Fun Bus name in a secure territory, training, manuals, after-sale support and a list of potential customers (day care centers), a customized bus and equipment runs another $25,000. Add additional $15,000 for some advertising, working capital and misc. expenses, and the total investment is approximately $65,000.

Although they are fairly new to market, they do have some track record, they started franchising in 2003 and have 16 operating units.

I have yet to see the UFOC (I requested a copy), but I think the concept could be a good match for moms, or 20 something year olds looking to get into business.

For more information visit: Fun Bus Franchise

Or call me if you have more questions: 877-469-3002

From the Aisles of the IFE

Author: Jim Coen
April 2, 2007
Category: Franchising in general

The Internationl Franchise Expo (IFE) in Washington provides a good opportunity to meet and greet the people involved with franchising. Walking the aisles offers me a glimpse into the current, and future situation. The show/conference ended yesterday after 3 days of activities.

From the aisles:

There was much talk about the recent purchase of $4.7 Billion paid for Servicemaster by Clayton, Dubilier & Rice Inc. a private equity firm. ServiceMaster’s subsidiaries include pest control company Terminix, TruGreen LawnCare, Merry Maids, and Furniture Medic. The high price multiple illustrates the value contracted royalty stream have to investors.

Attendance seemed down, but most exhibitors felt that franchise shows now attract a more knowledgeable and focused buyer than in the past. Buyers seemed to have done some homework and are attending the show to further validate and compare opportunities.

International buyers are not as prominent as in years past. The last 10 years has seen significant growth in franchising worldwide. The Franchise World Council lists franchise associations in 36 different countries. There are now franchise expos in every corner of the world including with some the largest in Australia, Europe, India and China.

More franchise buyers are coming for these major demographic groups:

Aging Baby Boomers: experienced and accomplished, they want to invest in a business to apply the “life lessons” they have learned and cap off their career.
Momtrepreneurs: Moms that want to contribute to the family income but have the flexibility to take care of their #1 priority to raise their family.
New Americans: New Americans are willing to work long and hard so they can achieve the American dream for their family
Professional Women: Well educated and financially secure women that want to own and run their own business and achieve success on their own.
Generation Yers: They are the most recent 20 year olds that have more enthusiasm then they have capital, but they have the desire and drive to make it happen.

Concerns regarding the proliferation of new franchise systems. It is estimated that over 1100 new franchise systems have been created by the “franchise mills” in the last two years. There is concern in the aisles that these firms may not prosper, thus cause a blemish on the success of franchising. Dick Rennick, founder of American Leak Detection and past chairman of the IFA, as well as the recipient of Franchisor of the Year by the AAFD, has started a company called Team Rennick to share his vision and passion to emerging franchise companies to help them succeed.

401k Franchise Financing has become main stream. There are 4 companies out there now that are offering plans to turn your 401K plan into a vehicle to finance your franchise purchase. The industry started a few years ago and I estimate that over 3000 people used their 401K to help fund their franchise investment in 2006..

Some of the industry sectors that seem to be in the highest demand and getting lots of attention are: children services, B2B, pet services, senior care, recreation, home maintenance and of course; food.

There are more suppliers today than ever before. As franchising grows and expands there are more and more suppliers out there offering services to enrich franchise organizations. Some of these services include: lead generation, website development, advertising services, human resources and career apparel to name just a few.