How to Embrace the Fundamentals of Franchising for Success

Brief Summary
In this power-packed episode, Jeff Dudan is joined by Gary Prenevost—veteran franchise consultant, FranNet leader, and author of The Unstoppable Franchisee. Together, they deliver a masterclass on franchisee performance, field coaching, growth mindsets, and the anatomy of great franchisors. From dissecting why some franchisees stall while others soar, to building systems that scale and cultures that last—this conversation delivers practical insight for anyone in franchising, whether you're a new owner or a brand CEO.
Key Takeaways
- Franchisee performance comes down to ownership and execution. The difference-maker isn’t just the system—it’s how well you use it.
- Top-performing franchisees master interdependence. They contribute to and learn from the collective intelligence of the network.
- Selective engagement is the enemy of success. Many franchisees cherry-pick what they want to follow and avoid uncomfortable growth areas.
- Great franchisors create systems, not dependencies. It's not their job to hand you customers—but to give you proven customer-generation systems.
- The best systems foster servant leadership, not top-down control. Trust, transparency, and values alignment drive performance.
- Field coaching must be data-driven, outcome-oriented, and trusted. Franchisees won’t open up unless they know you’re in their corner.
- Franchise success is math. With the right KPIs, systems, and actions, your outcomes are predictable and scalable.
Featured Quote
“Every franchisee is sitting on more opportunity than they think—they just have to stop coasting at competence and climb to mastery.”
— Gary Prenevost
TRANSCRIPT
Meet Gary Prenevost: Author of “The Unstoppable Franchisee” and 30-Year Franchise Pro
Jeff Dudan (00:03.138)
Hey everybody, Jeff Duden here on the home front. Today I have franchise author, franchise consultant, Gary Prennevo, welcome Gary.
Gary Prenevost (00:12.292)
Thank you, Jeff. Pleasure to be here.
Jeff Dudan (00:14.242)
Good. Hey, excited to have you on today. I've got your book, The Unstoppable Franchisee right here. I understand there's some congratulations in order that you've been ranked by USA Today as a top 10 business building book. So congratulations on that.
Gary Prenevost (00:27.588)
Thank you very much. Very exciting about that.
Jeff Dudan (00:30.078)
Yeah, yeah, fantastic. So love to unpack your thoughts on franchising and share my thoughts as well. Dance around that as a topic. It's the industry or the business model that we both make our living in. And I know that there'll be a lot of good conversations around that. Before we get there, would you share a little bit about your background? Maybe start with how you grew up?
Gary Prenevost (00:54.82)
Sure. Well, I was the middle of five kids, five kids in six years. It was intensely competitive. Father, son, Holy Ghost, the one who ate the fastest ate the most. It was kind of like, and that was the theme all the way through growing up. And so we were always looking for things to do self-supporting. I had a paper route, you know, when I was young, one of the largest paper routes when I was 13. And from...
Jeff Dudan (01:02.646)
Mm.
Yeah.
Gary Prenevost (01:20.184)
Before I got into my real career in banking, I had over 20 different jobs, Jeff. Nobody would give me the hours I wanted. So I would get more jobs. And then eventually I got into banking, was with TD Bank, Canadian Bank up here, turnaround specialist for underperforming branches. But after seven years of that, I felt like the contortionist in the invisible box. That was me in corporate, in a corporate job, I became an entrepreneur. Family business at first.
We had live and artificial tropical plants, became Toronto's third largest interior scaper, but realized working with family had its own challenges. So, and fell in love, met with, met my future wife, and I went from my family business to her family business, which was a franchise, or at the time a license. This was pre-Canadian franchise law. And I started selling franchises in 1991.
built that up to over 110 franchises over the course of 10 years. It was a franchise, it was a Canadian training and development group, sales, management, leadership training, business coaches. So I became a franchisee and I was also selling and doing corporate sales and supporting the franchisee. And that's where I really got my teeth into franchising. The divested of that in 2002 and bought FranNet. And ever since then, I've been doing the FranNet consultant.
Jeff Dudan (02:20.748)
And what concept was that?
Jeff Dudan (02:34.722)
Got it.
Gary Prenevost (02:45.88)
franchising, bought a couple of master franchises along the way and grew that or I actually failed at one business, lost over a million bucks. Some of the most important lessons in my life were in that because one of the things with my whole life and this is probably a familiar pattern for a lot of franchisees is we get up on plane and we you know we get going and then squirrel, oh what else is there and we don't pay attention to the business enough to get it to the next level and that's how I got myself in trouble.
But coming out of that, so I had 2002 start FranNet, built that up and while building the team, FranNet was keeping on going while I was still doing this business, this other business. But after three years and losing all that money, I came back to FranNet and okay, now I really have to focus. And in the next several years, became top franchisee, was just serious levels of revenue over a million dollars a year.
and learned a lot about moving for the first time in my life, moving from proficiency to mastery. And that kind of, doing that for several years, that kind of was the evolution or the foundation of the book. I was, 2019, I was sitting there going, why are so many franchisees not doing more with this system? And I started thinking about more and more, is this a unique problem or every franchise or has it? I think every franchise or did. So.
Jeff Dudan (04:04.078)
Mm.
Why Some Franchisees Fail (And What to Do About It)
Gary Prenevost (04:12.26)
And then I started asking the entrepreneur in me said, why isn't anybody doing anything about it? There's some industry verticals, but there was nothing that was ubiquitous. So I started looking for some answers and I found seven core elements that are ubiquitous across franchise. And that's what came out in the seven drivers of the book. That's how I got to where I am today.
Jeff Dudan (04:31.718)
Awesome. So let me ask you a question and I don't mean to tap dance on your un-painful memories here, but you failed in a business. You looked at it retrospectively, you deconstructed what it was. And you've been in, I'm in franchising, you're in franchising. Sometimes franchisees don't work. It just, it happens in every system. There's actually math behind it. It's a relatively predictable rate.
of franchisees that are going to atrite or struggle. And it really doesn't matter what the system is, to be honest with you. I mean, I see it in multifamily restaurants, I see it in service businesses, retail, it's across the board. And when we'll have a franchisee ask us to meet the team day.
You know, what's what is the difference that makes a difference in success? And I mean, the answer is like, well, it's you. It's actually you. You're getting the same system. Your market's going to be similar. You've got people that are being wildly successful. You got good intention. People that are working hard and trying to get up into that top 20% because there's one or two things that they need to fix or focus on or do a little bit better, and then you got some people that they put their hands up and they, they.
They build walls around stuff and instead of taking control over the controllables and making sure that they maximize those things, you know, they just, you just can't get them going. So if that's the case, I've often wondered, isn't there something that we could do before we award a franchise from a personality testing perspective or capabilities testing perspective?
to reduce the number of people that franchising business ownership just is not a good fit for they come to that realization? Or is it just really a numbers game? You can't measure somebody's grit, you can't measure somebody's heart, you don't know how bad they want it, you don't know how bad they need it. Like, how bad like a lot of what motivates me is fear of loss, fear of pain, fear of not putting food on the table for my kids, things like that. Like, so there's all of these factors that go into people's intrinsic motivations.
Jeff Dudan (06:40.426)
What was your epiphany after being in a business, it failing, and we've all failed, if you've been in business long enough, we've all failed at them. I've had my share of false starts. What was your epiphany? And then how could you, how did you use that going forward as you looked at new and different opportunities from that point forward?
Gary Prenevost (07:03.812)
Well, so a few thoughts. The first is that I fell into the trap of being seduced by the opportunity. The business model was
Jeff Dudan (07:12.838)
Okay. Don't marry, by the way, you want to hear a great thing? Don't marry the deal. Somebody told me that. Like, don't marry the deal. Yeah, I've learned that. You can put that in your next book.
Gary Prenevost (07:22.037)
Well, that's...
Don’t Marry the Deal: Lessons from Losing $1M in One Business
Gary Prenevost (07:26.68)
So thank you. It was a European model. We went to several countries. It was successful in 37 countries. And the math was incredible. But we thought we would just knock the cover off the ball. After 10 years in franchise and building systems, I thought I was made for this, right? Well, we didn't look at a couple of key things. We didn't look at the difference between the international market and how the Canadian consumer would be.
Jeff Dudan (07:29.684)
I'm out.
Gary Prenevost (07:55.908)
and some of the, it was mobile advertising with the business. And so I missed that and I missed the need of the market and the way the market was serviced. And we just couldn't get over those things. So one of my big epiphanies, and this really helps when I'm working with my FranNet clients, is that the perspective franchisees should be able to articulate to the franchisor, to themselves
what the business model is, how they're going to execute it, and through that execution, what level to achieve their own goals. And I find this is to franchise or is out there. I find too many franchisors let people in without having that. How well do you understand the model discussion? And so because you'll see that in somebody's ability to communicate that they're missing key elements. Now, there's always going to be people that
Jeff Dudan (08:41.794)
That's fair.
Jeff Dudan (08:52.202)
Yeah. I see that. I think I see it in about one out of 20 where you'll be in training and it'll be like, Oh, I didn't, I, you know, they didn't internalize it. They were in the conversations. They were in the presentation, but they were thinking about something else when it was going on and there's some aspect of the business that they just didn't. Maybe it's one out of 30, maybe it's one out of 40, but it happens and it's very apparent when it happens because they.
start asking questions like I have to do that. Yeah, this is part of the gig, man.
Gary Prenevost (09:24.916)
And then you get the people who look ideal on paper. They look like the ideal franchisee. They have the skills, they have everything. And they show up entirely differently. I don't have to, I go, it's, I'm going to do it my way. And I think one of the biggest challenges new, new franchisees have is they go from being really good at whatever they were doing before to having to be not good at something else and learn it. And so they, I've come to know.
Jeff Dudan (09:38.147)
Hmm.
Selective Engagement: The Trap That Keeps Franchisees Stuck
Gary Prenevost (09:54.188)
developed this term called selective engagement. Franchisees will selectively engage the parts of the system that they like and are comfortable with. They'll tell Mr. Franchise, or I don't need that for the rest of it. And those other things are, and it just stops them. It puts them in that comfort zone of middle or low performance.
Jeff Dudan (10:12.342)
Gary, what I do, I exactly cover that in the initial training that I do. And when available and almost all the time, I do the first hour, two hours of training with all of our franchise groups, because I want to be the first thing they hear and I want to make sure they hear the important, what I think are the important things in their success. So those things are how to build your team, how to build an intentional culture, what that looks like.
what the relationship needs to be in all 360 degrees of direction around their business, customers, peers, other franchisees, home office, that kind of thing. But then I challenge them and I say, you are going to hear things that you are uncomfortable with. Nobody can do everything. So this week in training, you're going to hear things you're uncomfortable with. And I'm challenging you when you have that internal dialogue where you're starting to hear something and you're starting to get uncomfortable because it's against your
It's against your nature to do, to be comfortable with this. And you start having an internal dialogue or thinking about something you like better or something that makes you comfortable that you star that and you write that down and you realize that you're going to have to get somebody else to do that unless you have a big enough battery to actually learn those skills and overcome your discomfort with it. And you know, you, all of our businesses have teams, some bigger than others. And I tell them, I said, you know, you, you've got to have.
a you want diversity in your team because you can't do everything. You want diversity in all things in your team, skill set, raise age, all of the, all of the things. So you get a diverse team of people that are connected and, you know, working together in a highly accountable team, but you don't want diversity in values. So.
You know, you know, when they, they have to understand that if they hire everybody that's just like them, it's going to be a low performing team. And the, the way to figure out who you are and to know thyself is to first take some of the assessments that we give them and then second, just be real honest. What were the things during training that just made you really squeamish that you said it's probably not important because I'm telling you it is.
Jeff Dudan (12:26.634)
What everything that we teach you in training is absolutely critically important for you to do, but that doesn't mean you have to do it. But if somebody has to, and if there's nobody else to do it, then that day you have the somebody shirt on your somebody to do it, but if not, if it's nothing that you can do because it's against your nature and your battery is going to wear down as you do it, then you got to find somebody else to do those things and we'll help you with that. But to your point, selective engagement. Uh, it's.
Gary Prenevost (12:42.926)
Yep.
Jeff Dudan (12:55.282)
It happens with all of us because there's a very small number of things that I would consider that I do well. Those things I probably do really well, but I know that I've got to build a team of all of these other things around me to be successful. Ultimately.
Three Ways to Fill Your Skill Gaps: Do It, Hire It, or Ignore It
Gary Prenevost (13:10.848)
It's interesting, you know, I relate completely to that. When I'm sharing with my clients and audiences, is every entrepreneur has what the transferable skills, the primary resources, transferable skills, time and cash capital. And when it comes to building a team and driving a business, there are three options that an owner has around skills. They can
Jeff Dudan (13:27.418)
Hmm.
Gary Prenevost (13:35.704)
do it themselves, learn it and do it. So ideally that's the core drivers of what the business needs is what they're good at and love to do. They can hire people who have the complimentary skills or they can ignore it and hope it doesn't become a big problem. And it never ceases to amaze me, Jeff, how many franchisees and business owners in general choose the last one, I'll get to it, I'll get to it. I'm gonna hit this end and oh man, that becomes dangerous. So coming back to what you just said about how important
Jeff Dudan (13:51.072)
True.
Gary Prenevost (14:05.2)
important it is to build a diverse team. Absolutely critical. And recognizing that it takes time to get it right, and it also takes capital. I think a lot of people are under invested, under capitalized when they when they launch a business. They might have it, they just don't want to deploy it.
Jeff Dudan (14:25.302)
Right. Yeah, absolutely.
How do you think about business today? Are you operating businesses as you're consulting and you're speaking and you're authoring your main business? What's Gary doing today with his time and energy?
Gary Prenevost (14:44.328)
Well, the friend of business I've been doing, I'm in my 20 somethings year. I love that business. I get to help people change their lives. So it's a pretty cool business. Thank you. And, and so I just can't see myself ever stopping doing that. The, the public speaking, the, like the keynote speaking, the consulting with franchisors on engaging franchisees, that's starting to grow and develop. So I'm doing all those different elements.
Jeff Dudan (14:51.307)
Congratulations.
Jeff Dudan (15:11.794)
Awesome. So when you look at franchisors across the inventory, things that you show to people, what makes a great franchisor in your opinion?
Gary Prenevost (15:25.088)
I think the first is vision. The franchisor and the franchise team, leadership team, have clear vision about where the business is going, what the need that they serve is and who their customer is. And so that is, everything comes from the vision. And part of that is the culture that they built. Because the culture is the glue that holds a franchise system together. You have a really...
a sharing culture or a isolation culture or everywhere in between. Second is systems, duplicatable proven systems that they are able to coach and train and help people do with a minimum level of engagement. That's the whole franchise model. But it doesn't mean you're throwing the franchisees up to the wolves. It's helping that.
helping the franchisee part of the systems, Jeff, is helping the franchisee get customers. One of my beliefs is I believe that it should never be the franchisor's job to bring the franchisee customers. And people, what the hell are you smoking? What I tell people is as franchisees, it is the franchisor's job to bring you proven systems, business systems and process, part of which.
Jeff Dudan (16:38.634)
Mmm.
Gary Prenevost (16:49.248)
is a customer generation strategy. It's the franchisee that has to be able to implement that strategy and convert clients. So I think, I think that part of the system, so many people buy franchise and think, Oh, the money's just going to flow. The customers are just going to come. Well, that's fine. They might come early if you have a decent brand, but a lot of younger brands, they don't have that yet. So the franchisee has to execute.
Jeff Dudan (16:56.308)
Right.
Delivering the Brand Promise: Systems, Experience, and Accountability
Gary Prenevost (17:14.396)
The other thing that's implied in a system is the brand promise. We are dealing with the most educated consumer in human history today. We know what we want, where we want to get it from, what it costs, what the value proposition is, and the experience level. So if a franchisee thinks that just by joining the franchise, the customer is going to get this, if they can't deliver the experience, the customer might come back two, three times, that's it. And they're going to leave poison pills on the way out online. And now that franchisee is struggling.
Jeff Dudan (17:14.679)
Yeah
Gary Prenevost (17:44.504)
So it's helping the franchise or great franchisors help the franchisees build the systems and deliver the brand promise at or above expectation level.
Jeff Dudan (17:57.01)
Specifically with customer acquisition, I have not found a model yet where the top franchisees are not active in their community, working a list of business owners who could be referral partners or even reputation partners. You know, when you're, when you, you know, one of the things I coach our people to is to whatever, we have national charities.
We're partnered with Carson Scholars. We build reading rooms across the country in Title I schools because we care very much at Homefront brands about children. The earlier that you invest in or fix a defects in the manufacturing process, the cheaper it is. So investing in our young people is an investment in our future, and we wanna make sure that they have resources. We care about transitioning veterans. So we partner with Operation Homefront. We're about 60% here in the States. I know you're Canadian.
Um, but you know, Hey, we've got, we've got this, we got this border for you. Like you don't worry about getting invaded from the United States. I can promise you that. So, you know, we, we're about 60%. Uh, cause you got those dudes on horses and we're not, we don't want any piece of that. Um, so we're about 60% of where our military needs to be here. So it's not as popular a choice as it used to be, but it's a great option for people. Uh, so we're, we provide resources, uh, to help.
people transitioning out and give them an opportunity to feel good about their service. And then we encourage our franchisees to participate in those endeavors with us, whichever one they feel compelled to, but then also to have a local cause or a local charity and then to go and get on a board or get on a committee. Because usually when you go into a city or a town, the business leaders who understand
so much was given to them by that community that they need to give back and they need to participate. Those are the kinds of people that you wanna break bread with. Those are the kinds of people that you wanna learn from and get in a running group with. And they may or may not even be referral partners. It might be some service business or some copier business or a technology business. But having those connections as a business owner for the first time, as a franchisee, that's really, really important to get out there into the community.
The Power of Community Engagement and Local Leadership
Jeff Dudan (20:20.266)
And then of course, working, we have 90 day sprints where we identify the nine different communities that our franchisees need to be connected with and they need to get on the street and go and meet these people. Because I don't care if it's a sauna studio, a fitness concept, a service business, a referred lead is always gonna close better. You're gonna close it at a higher margin, you're gonna close it at a higher percentage.
So if you really want to build a great business, there are things that you as an owner need to do that take action and putting yourself out there while the digital leads are working for you, while the PR is working for you, where the brand awareness and the websites converting, that's all part of it. But the biggest business owners I know have the largest percentage of business is self-generated by the things that they do and how they show up in their marketplace.
Gary Prenevost (21:18.428)
And I couldn't agree more. I focused all of the research on what do the top 4% of franchisees do that the rest don't? What are their traits and characteristics and what do they not do that the rest of the franchisees do? And it's been said many times that if all it took to be successful in franchising was follow the system, everybody would be top performers. Top performers do more with the exact same system that everybody else has.
Jeff Dudan (21:29.279)
Interesting.
From Competency to Mastery: How Top Franchisees Level Up
Gary Prenevost (21:45.028)
So, and I think part of that is the way that they approach learning and growth. See, when you think about somebody coming into franchising, you go from novice to competency. And that takes a year to two years to really get to, this is the foundation, learning a system. I have to think about it. Constantly, what do I gotta do? And that first year to two, they're learning, learning. They don't know what they don't know. And then they get to...
competency where, okay, now I got it. Now I understand enough of the system I can execute. And then they build decent businesses and a lot of franchisees, Jeff, just coast there. They got good lives, but they're sitting on so much more opportunity. Well, top performers, they take that and say, okay, now I know it. How do I master it? And now they take it to the next level and they're going to look at their, their field coaches, or they're going to look at their peer group, other top performers. Who else can I learn to?
fine-tune this little bit or other elements, and they incrementally get better and better. And you're just talking about one area about engaging the community. That's critical. Any top performer engages the community, but they also, you know, you think about staffing. You talked about at the very beginning today how important building a team is. I see so many franchisees that they treat their staff as a resource to be consumed or exploited. Whereas top franchisees...
Jeff Dudan (22:53.55)
They do.
Gary Prenevost (23:11.248)
treat their employees as their most important repeat customer. And it's just what a difference in how they approach their businesses.
Jeff Dudan (23:22.262)
Yeah, people are our greatest asset. And the reason that I kick off training with building your team, tips, tools, tactics, models of thought that I've learned over 35 years. Somebody said, how long you been in business? And I hadn't done the math, 35 years since I started my first business. Yeah, right? So, but if people, if you do the people piece well, you have a chance to do well.
Gary Prenevost (23:39.006)
We're in the same pickling vintage.
Jeff Dudan (23:50.002)
If you do the people piece poorly and you're having all kinds of personnel issues and turnover issues or theft issues or trust issues, it just makes the execution of the business that much harder. So, you know, being a, you know, being a good leader, whatever that means to you, doing it in your authentic style so that you can help people, you know, people trust you because if you were in your authentic style, you can be consistent with that and consistency is a big part of trust.
And you don't have to be perfect and you don't have to be, you don't have to change who you are, but you just have to be consistent to it. And then what happens is, is people will decide whether they're wanna be with you, whether they're on your tribe. And you know, it's the vibe that builds the tribe, but it's also the vibe that breaks the ties when it comes to business.
Gary Prenevost (24:37.4)
Well, and a key part of people leadership is communication. And, you know, the coming back to, I write a lot about this and in the book around growing your people is the communication. This is what I need you to do today compared to, Hey, this is why this isn't so important. This is what your responsibilities are. This is the coach I'm going to provide. And as you get better, this is what my expectation is going to be. And this is how we're going to measure it. Like, and then.
Lag Indicators, Leading Actions: Coaching with Real Numbers
Jeff Dudan (25:03.85)
Mm.
Gary Prenevost (25:06.308)
How often do they communicate? Several of the top franchisees I talked with across different brands, didn't matter what industry, daily, day start meetings or week start meetings. How do we do, what's going on, who's responsible for what? And these are even when the franchisees are not actively day to day in the business. They just build a team and have that level of communication. So there's a lot of things to unpack around.
leadership. You talked about the 90 days sprint, my brain immediately goes to KPIs and performance tracking, right? So many people only track the lag indicators. What are my sales? What is the activity that you have to do to drive the top line? What is the production percentages around throughput or whatever to really get that efficiency? Each business is going to be different.
Jeff Dudan (25:37.782)
Right.
Jeff Dudan (25:59.37)
Yeah, so anytime you have a lagging performer and you get on the phone with them and they'll say, hey, I'm doing everything. Okay, everything? Well, today's Wednesday, tell me what you did Monday. Monday, eight o'clock, where were you? And then when you get into the granularity of it, they're not doing everything. They're not doing it. And maybe they didn't know to do it and it's not intentional or whatever. So no fault here. We're here to help people with a servant mindset. So.
But what they probably didn't realize is they just weren't into the disciplines of the actions. And if you're not hitting your goals, don't change your goals, just increase your actions. Examine your activities. What are you doing? What are you not doing? What are you investing time in that's not moving the needle? What are the priorities? You, any time that I've been in a business and performance was lagging, the first thing I did was I looked at like, what can I stop doing?
because I know that there are a vital few things that drive any business. And if it's great to get fancy and to do, you know, extra campaigns or these other things, or we're gonna try that and we're gonna expand into that. But when those take over precedence and it's really distracting from those vital few things that the business really requires, you've got to be able to identify those, get back to basics and then redouble your efforts on those actions and it's incredible.
We used to do a thing called boiler room. And I haven't talked about this in years and years and years, but so we would, in any time that, uh, a franchisee would get slow or they'd say, Hey, I really need some work. You would go and I'd say, all right. We would get, get everybody on the team in a room and we'll call it the boiler room and I want you to go back and I want you to, I want you to call, uh, you just, and you sit in the room to get, you don't say, go do this. You sit in the room together like a boiler room.
and you listen to each other make calls. You say, all right, first thing I'm gonna do is I pulled all the leads and all the estimates from the last 30 days. We're gonna call those people back. Here's 10 for you, 10 for you, 10 for you. We're gonna call those people back. We have an offer. We're gonna stack value inside of an offer. There's gonna be a time-based offer where we can do this right now. We're gonna look to...
Jeff Dudan (28:20.686)
take the existing estimate that we did and maybe they need a little bit of financing, maybe they need this. And then we would do it and we would do that and I guarantee you we would get a couple of three jobs out of those calls. And then you go back to 60 days and then you go back to 90 days and you go all the way back to 180 days. And by that time you have so many new appointments and you have so many leads. So a lot of the assets that they needed were just right there laying around the office, but they were looking forward.
to see where are the new leads coming from and we don't have enough or we're not closing them or whatever, but they hadn't really utilized everything that they had. And there are other things that come to light from that exercise that processes weren't getting done, they had gotten a little bit sloppy. Because at the end of the day, assuming that the business is sound and that it works and it's something that customers want, if you put the right actions to it, you're gonna get the outcomes. Business is generally just math.
and leads are the fuel that run through the machine to create the profit on the other end.
Gary Prenevost (29:24.06)
and what the franchisee does to load the front end in terms of leads, that going back to are they engaging the community or investing in the marketing, where the franchisor is guiding them. Then you get into the lead follow-up, speed to lead, all of that element. Yeah, so there's so many different sub-components. And I love that example because while you get the business generation from that, the extra...
Jeff Dudan (29:31.776)
Yeah.
Gary Prenevost (29:52.636)
revenue that was sitting on the table. I think about the learning that took place as they heard each other and oh my gosh, the little clues in the dialogue, I'm not doing that or I could be saying that better. That really worked. That didn't and everybody learned. And that's the collective brain trust that is franchising if it's built properly and supported properly.
Jeff Dudan (30:13.718)
You know what? Yeah, and do they have a clunky machine? Are they fat? Are they unaccountable? What's going on with the mechanics inside their machine that takes that lead and turns it into profit? Franchising's interesting because you have this different dynamic where people weren't maybe entrepreneurial before and now they've made, but they've had a great career, they've been able to cobble some money together, they invested in this business.
Now they've kind of bought themselves an opportunity for economic freedom growth. Uh, some, you know, the ability to build a scratch and itch, build a team, build some equity in something that maybe they hadn't before all of those are opportunities there, but they also, uh, if you're a standalone business owner that just scrapped your way up and built a business, you would never think to stop and call a neighboring business.
and say, it's not working for me. Is it not working for you? And commiserate with some other random business owner, right? We're in a franchise system. If they're uncomfortable and it's not working, they might invest time in things that aren't really good for them in terms of just, hey, I wanna find five other people that are struggling with this. And for some reason, instead of focusing on...
You know, really being introspective, taking accountability for the business and saying, what do I need to do differently? What do we need to do differently? It's a real interesting little thing because franchising creates a community of business owners that are all facing the same thing in different markets. At the same time. And, and, you know, using that influence and that leverage to help from one franchise owner to another franchise owner to help them, uh, is really, I think a hallmark of a really good franchise or, you know,
radically transparent, highly engaged, creating lots of avenues for learning in all directions. I mean, those are the kinds of things that good, solid franchise organizations do to accomplish continuous improvement.
Interdependence: The Secret Weapon of Scalable Franchise Systems
Gary Prenevost (32:21.904)
The element of what we're talking about is interdependence. It was the single biggest surprise. Like you, 30 plus years in this industry, on every side of the franchise table. I didn't mention I was with iFranchise, we were for five years helping companies become franchises. So it's...
Jeff Dudan (32:28.245)
Yes.
Jeff Dudan (32:40.338)
Congratulations, they just sold yesterday. Do you still have your stock?
Gary Prenevost (32:46.056)
No, I should got talked about that. But when I think about interdependence, it's the franchisees ability to access the collective brain trust of all the other franchisees that have the system has evolved and been refined. Now great franchise do all the things that you just said, they foster that communication. They create the systems and processes for bubbling up best practice and best practices aren't always here's what to do that's right.
Here's what we stopped doing that doesn't bear fruit. So the constant evolution, but the learning from franchisee to franchisee. What I found in my research was the vast majority of franchises sip. They sip at that collective brain trust pool, whereas top performers gulp at it and also contribute back to it. So great franchisors contribute to the development of that. Average franchisors.
They pay a little bit of attention to a weak franchise or is telling your franchisee. Don't talk to other franchisees
Jeff Dudan (33:48.194)
So the word interdependence, I did see it in the book. It's near the back, right? I mean, it's one of the, it's step six or seven or something like that. Yep, there you go, interdependence. And that's actually something that we've been talking a good bit about with our candidates and also early with our franchise is that we are interdependent and we're relying on one another. This isn't a vendor relationship. This is something more meaningful and integrated than that. So...
Gary Prenevost (33:56.587)
This is six driver, yeah.
Jeff Dudan (34:19.207)
I'd love for you to unpack that concept of interdependence just a little bit more, if you don't mind, and just leave it open to you to do so, because I want to hear more about your thinking on that.
Gary Prenevost (34:26.382)
Sure.
Well, let's look a different way at the franchise model first. When I look at people who are looking at franchising, compared to starting a business from scratch, franchising is a time compression model from when you decide to buy to when you open. The franchisor is going to tell you, do this, and this, and they're going to keep that. The franchisee is very dependent on the franchisor for that. Then from open to break even, it's still,
Jeff Dudan (34:34.912)
Mm-hmm.
Gary Prenevost (34:58.936)
what the franchisor is telling them, because they're learning everything, building that foundation of knowledge. So I liken that to the dependent, like the toddler years when the kids are little, they are totally dependent on the parent. Well, then as the franchisee matures, it's okay, I got this. I know what I got. Mr. Franchisee, Mrs. Franchisee, leave me alone. Give me some space, right? Doesn't that sound a little bit like the teenagers we have?
Jeff Dudan (35:23.083)
Right.
Gary Prenevost (35:25.76)
You know, it's like they pay more attention to their friends, and their friends know more and their other influencers and the franchise or and they go off track. And some people stay off track. And that's how they become average or marginal franchisees, or they can actually become toxic and become damaging to the system because they're working against everybody. But when you go from the teenager to, you know, you're 20, 24, gee, mom and dad.
Jeff Dudan (35:26.104)
Yeah.
Jeff Dudan (35:34.03)
Sure.
Gary Prenevost (35:55.184)
Can you actually help me with this? And they're involving more, well, the franchisee that's got to that level of maturity, okay, maybe I don't know as much. Maybe I can learn from other people. I bang my head against this wall often enough. My way isn't working. Maybe I should start paying attention to more about the way the franchise or his way has been working that I've been resisting for so long. What we were talking about earlier today.
And so now they go to other franchisees who have been more the leadership role, the informal leadership role. Some franchisors have mastermind groups. We have mastermind groups, top performer groups, triads, accountability partners, whatever it is that the franchisee has extra resources. How many franchisors have great, the whole LMS learning management system where the data and the information is there, but they don't click on anything?
Jeff Dudan (36:35.31)
Sure.
Jeff Dudan (36:51.819)
Right.
Gary Prenevost (36:52.16)
So I think as people mature as franchisees, they realize there's so much more that I can be gaining from the system. So year one, year two, time compression strategy. Year two, net and on, it becomes a growth acceleration strategy to the degree, Jeff, that the franchisee wants to embrace it. And that is where interdependence really, really comes into play.
Jeff Dudan (37:23.618)
We have had incredible franchisees that have made the decision that they want to be a leader in the system and have probably had as much positive impact in our systems.
as any employee or even myself. It's just when you get somebody that gets it, they go through the stages and they've figured the business out and they want to be a good citizen because they care about the people that are coming behind them. You don't need but 5% of those to 10% of those people. But if you can, if you have them.
they can be your greatest asset in terms of, because it's like the four minute mile, okay? In businesses I've been in, well, you guys are the, you guys have been doing this for 20 years, and yeah, you guys do $20 million a year, but we can't do it. And you have your first group of franchisees and they're banging around it between 500,000 and a million. And that goes on for 18 months. And then the next thing you know, we had these two guys come in, bought a three pack.
in Louisiana and two years later they were doing 3 million bucks. And it's like, oh, and then all of a sudden, you know, everybody's chasing them to $3 million. It was like, was this invisible. I can't barrier around it, even though, you know, the precedent, I mean, we were operating in the restoration environmental services space, so it's like, it was big companies everywhere. I mean, you could just, you couldn't, uh, I mean, I think when I did the, when I started the business, I mean, it was such a red ocean, I think there was.
was it 550,000 companies in the United States per the SIC codes that were doing what we were doing in some capacity or another, you know, I'm like, why would you start a business into that space? Well, at the time we created some real compelling differentiators. We were one of the first, not, I'm not going to say one of the first, but one of the first smaller emerging brands that I was aware of that did like full call center.
Jeff Dudan (39:25.446)
highly integrated systems. We went with Salesforce, we bent it to our will, we created using the permissions to it so we could get shared, you know, really flexible in terms of the way we're able to provide support and answer calls and book appointments and help with estimates and stuff. And, you know, so we felt like we could bring some sort of competitive advantage by reducing the overhead of about a hundred grand of that they didn't have to have people doing these services in their.
local office and then you know we charged another couple points on the royalty but it was well worth it.
Gary Prenevost (39:59.416)
Well, you think about that, the value that the franchisee has, they don't have to staff that person. It's going to be a turnover position, so they have to train. They're putting a whole bunch of hours. So I love franchisors that have call centers. I think that's a huge value add and worth every penny that they charge. You know, when I process what you just shared about the
Jeff Dudan (40:05.535)
Right.
Jeff Dudan (40:11.01)
That's right.
Market Excuses vs. Mindset Execution: Why Location Isn’t Your Limitation
Gary Prenevost (40:26.62)
the franchisees in different markets really, like the four minute mile. There's another condition as well. And this is where mindset, mindset's my first driver because everything else, it influences everything else, right?
Jeff Dudan (40:36.906)
Yeah, I saw you had Carol Dweck channeling some quick Carol Dweck in there. She's one of my favorite authors.
Gary Prenevost (40:45.098)
The mindset is, I hear so many times, I hear it in validation when my clients are looking at businesses, I hear it with my prepping for the keynotes with the franchisees for conferences. My market is different. This doesn't work in a big market. The same system, somebody sell this doesn't work in a small market. It's what people do with the market that they have.
alignment of mindset skills, the utilizations, all the things we're talking about. It's not about the market. It's about the execution of the business model within that market.
Jeff Dudan (41:23.274)
Yeah, it's, it's just saying, I am not going to let myself fail. I'm going to burn the boats and I'm going to do, I'm just going to, going to get all of the self limiting beliefs and negative self talk out of my head. And I'm just going to focus on the, the details of what needs to happen here.
I'm going to commit to looking at numbers every day because the truth always lies in the numbers. You can anecdotal, you can, you know, qualify things and you can have anecdotal things and you can spend a lot of time talking about a lot of things. But the reality of it is, you know, if it's not in the number, how fast can you get the first dollar? How fast can you get to first lead? And then, you know, how is that lead converting? And then how many do you need? It just comes down to math and any business. It starts with.
Once you understand the machine, this is what it costs to drive a lead. I understand all leads aren't created equal. I understand that different salespeople perform differently. So you measure average dollar that they generate per lead. You drop it into the system. How long does it take you to produce whatever it is? Are you controlling your cost then and what drops out the back? Now, once you have your machine built, you can just look right at the top of the funnel. And I knew a guy that, uh, I sold him a business, but he was people to
huge waterproof, I don't even know, is he 40, $50 million now? He was $1.9 million when I sold him the business that I sold him. And he would just look at his business plan and he had all of these other factors figured out, hammered down. People were trained, people were in place, had the sales training and all that. So then he said, well, if I want to grow $10 million next year, based on my math, I need to spend exactly this amount of money. And he had it down to the penny. I need to spend exactly this.
in marketing to drive the number of leads that I need to drop at the top of my machine to be able to get me $10 million in sales. And it was life changing for me when I saw that realization, that discipline of that leads.
Gary Prenevost (43:27.804)
And it is a discipline, isn't it? Just like cold calling is a discipline, and networking, and asking for those are disciplines to be learned. But to learn a new discipline, which is a fancy word for word habit, you have to get rid of an old one that's interrupting the efficiency of that new discipline. What are your views on the field coach to support franchisees?
Jeff Dudan (43:33.483)
Mm-hmm
Jeff Dudan (43:41.92)
Right.
Jeff Dudan (43:49.346)
That's right.
Jeff Dudan (43:55.85)
Gary, are you asking me a question on my podcast? You might be the first person that ever did. I want to just... Well, Gary, I'm glad you asked. I'm so glad you asked. So first of all, there's a... We had this discussion yesterday. We're, let's talk about what do field coaches need to be successful?
Gary Prenevost (44:00.203)
I am.
Gary Prenevost (44:24.673)
Mm-hmm.
Jeff Dudan (44:26.006)
They need access to data and they need real time, they need real time results and they need to be able to interpret that. Much like a physician's assistant would be able to look at a chart after you go through your executive physical and look at all of these different factors and say, hey, you're pre-diabetic. And to, if you wanna change that pre-diabetic condition, then you're gonna need to lose this weight, maybe take this supplement, change this part of your diet, whatever it is.
Oh, hey, you've got this other condition here where, you know, your hearing's going or a little bit, whatever it is, but it's all based on numbers, they can't make any assessment until they get the numbers. So what we did at home from brand, we spent, we spent millions of dollars on our technology platform. As a matter of fact, you had a great win today. Last Friday, no, two Fridays ago, I was getting ready to speak at a conference.
And it came across my phone that we were named, Homefront Brands was named by Satya, who is the CEO of Microsoft as Microsoft SMB, Small and Medium Business Partner for 24 and rolling out their co-pilot solution, which is their AI software. And we have a, yeah, I mean, we have a gold partner, we've made the investments, but I say that to tell you that we have our franchisees,
Gary Prenevost (45:37.036)
Wow, goosebumps, man. Congratulations.
Jeff Dudan (45:49.514)
have dashboards like and we're getting I saw I reviewed the next version of the dashboard yesterday they're fantastic I mean it's stuff it's stuff that I only dreamed of having when I built my first business over 24 years and 11 months and ultimately sold it and I when I went into this I said if we were going to be the best we could be then what would we need to have in place so you know for franchisees before we started putting a lot of franchisees in it so we made a big commitment to technology and we had a pretty
tight roadmap on what we were doing. So a business coach now, by the time the business coach gets on the phone with the franchisee, they already know where the problems are because you have relative to every other franchisee, your closing percentage, next month the marketing dashboards roll out. So cost per lead, return on ad spend, all of that kind of stuff is gonna be in that dashboard. You've got your production dashboard. So they can look at it and say,
All right, well, here's the areas where you're below the mean. Here are some areas of improvement. I know the three things that we're going to talk about that affect this KPI. There's basically in the main dashboard, there's 13 relative KPIs that we benchmark them against their peers. So it makes it kind of easy, as opposed to in the past, when I didn't have that, it's like, hey, Gary, how's business? It's good. Yeah, what's going on? Are you having a good month?
Yeah, man, it's going pretty good. It's like you can't after they stopped showing up for those calls. Like if you don't bring the most important thing in business coaching is there better be a tangible outcome to every conversation. So we have to coach the coaches. We have to put them in a box and we have to make sure that they're look, we want them to be relational and we want them to get be friends, but don't spend 60 minutes on a phone talking about the fishing tournament and the dogs and the other stuff.
because that's great, but then the franchisee's gonna get off the call and say, well, that didn't really help me, so they'll stop showing up and that. There's a, and the conversation we were having yesterday is based on where we are with our data, do we really need one coach for every 20 or 25 franchisees? Or are we gonna find out that these are
Jeff Dudan (48:11.062)
self-correcting entities now, because once they learn to read the tea leaves, they can self-diagnose. And we also made a huge investment in learning management. So we can take, in the learning management, we build modules, we have not yet, it's all front-end training right now, but it's actually, we're in that big NPS, it's the highest rated thing that we have as our learning management system from our franchisees. And
We can then put that in the learning management system and say, okay, now that you recognize this on the dashboard, you can go here and there's a module for you to understand what are the three levers. We think we're gonna be getting very efficient in terms of the demand for coaches that we have over here at Homefront Brands based on kind of where we've taken technology.
Gary Prenevost (48:58.368)
So a couple of thoughts. I love the investment, I love the elements of it. And that's the data and the results or the communication dynamic. When somebody is coming into a franchise system, would you agree that they are illiterate around those systems? So there has to be a training and a bringing the, that's the role of the field coach or maybe pre-field coach getting in the training. But once they've got some degree of illiteracy, I would...
suggest that trust is the most important element. The franchisee has to trust that the field coach is there for them to help them and they've got to be open, Jeff, they've got to be open to feedback and criticism and hey this is where you're not quite here. So part of the reason why it's not just coming back to the book, I just didn't write the book.
Jeff Dudan (49:33.343)
Yeah.
Trust, Transparency, and Servant Leadership in Field Coaching
Gary Prenevost (49:56.816)
There's a playbook in there that it's a series of self assessments that the franchisee can look at regardless of which part of their business. This is where I am. And then if they choose to share that with the field coach, now they prioritize together the areas. This is what we need to work on. Now the other tools come in, whatever the franchise or has the tools. But so many franchisees don't understand that level of...
focus? Is it a coach or is it a cop? Are they here to help me? Are they here to look for where I'm going wrong? And they so they they're they just eke out a little bit more and a little bit more of the trust and they're missing the opportunity of a lot of those coaching foundations.
Jeff Dudan (50:44.714)
Yeah, Gary, great point. Here's how we work that out at Homefront Brands. So our values, and you know, values aren't altruistic, man. They're like, they have to be live in the business. There has to be tangible examples about like where this value applies and how we use it in our everyday life and building relationship equity with you, a franchisee. Our CARES value, the last one is S, it's for service, and it's for servant leadership, servant's heart.
And here's exactly where we use this. This is the example that we use. So if you take a traditional organization and you, you top down, right. And the franchise or lords over the franchisees who beats up the vendors and tries to serve the customers, or you take that triangle and you turn it upside down and we say, we're a service organization, we're going to serve the franchisees and together we're going to serve the vendors, the partners, the customers, and, and everybody else. And, you know, it's subtle, but significant. That is a subtle, but significant change.
And so why is it so important to use a boxing term that we use servant leadership to get in the pocket with our franchisees, meaning in relationship? It's because if the trust is not there to your point and they think all we're trying to do is catch them doing something wrong instead of praising them for doing something right, then, uh, they're not going to tell us the truth. So, you know, here I'm on a coaching call. What's, Hey, we see your numbers are down. What's going on? Well, it's the market.
You know, the market's slow. I've talked to everybody. Everybody's slow. Okay. Well, um, you know, it seems like you're getting enough opportunities. Well, you know, yeah, I'm getting enough opportunities, but the leads aren't as good as they were. I'm not sure what's going on with it. And, um, and then the conversions are down a little bit. Well, you know, this sales guy, he's, I'm not sure what to do with them. I got to give them some coaching or do something different and all that. And ultimately the person just says, Hey, look, it's, and you know, Hey,
Gary, it seems like your eye is not on your business. I'm going through a divorce. Like, OK. The problem is, if you're not in the pocket with people, you will constantly be working on the wrong problem. Your ladder is going to be against the wrong building. You're not going to get to the root cause of it. They're not going to tell you. And then six months later, they're going to be like, hey, I got to sell my business because I got to split everything up. And there's no way to do it with me hanging on to the business. And
Gary Prenevost (52:47.609)
Mm-hmm.
Jeff Dudan (53:12.01)
So, you know, that's how we work that out. And we have to coach our people and remind them that like that is the goal. You know, the goal is to deescalate emotions by going to the numbers, connect them with solutions for the problems, for the improvement. And you know, when you start a business, Gary, it's the big stuff, it's the gross stuff. It's like, oh, staffing is gonna be this and labor.
supplies and customers and marketing and all of that. But then as the years go on, you're just trying to find 50 basis points of extra profit, 75 basis points, a point and a half of this, and you're just incrementally trying to nudge up their performance, whether it's at the top, whether it's managing the middle to get more to flow through to the bottom line and to hopefully help them grow their top line because that's how we get paid as a franchise, or if they're making more on the bottom line, they should want to grow their top line. But...
you know, ultimately it's the fine details and the fine tuning that we need to be able to give them. And without the optics into the numbers, it wouldn't be possible.
Gary Prenevost (54:16.8)
And you know, I love that in the pocket metaphor. And when does that start? When does the foundation of that relationship start? Jeff? Most people would say it starts. Yeah, sure.
Jeff Dudan (54:26.547)
It, are you asking me?
No, no, go ahead. Sorry, that was rhetorical. You asked me a question. I thought you were asking me another one. I was kind of excited.
Gary Prenevost (54:32.001)
No, no, I'd love to hear your answer.
Gary Prenevost (54:36.898)
Yes, I'm asking you another question. When does it start?
Jeff Dudan (54:40.158)
Well, for us, it starts on our foundations call. So every Monday at five o'clock, I do a call with every candidate that's in process. And it's a group call. And I just, I it's, it should be in our development process with our, with our development directors. I do a call every Monday with every candidate that will show up. That's in process, you know, and we'll have 20, 25 people on the call. And then, um, and it starts there. And then we work this stuff. Like what we just.
did now, we work out our values in our meet the team day. Like that's what it's, you know, 45 minutes or an hour, each one of them standing up and saying, which value resonates the most with me and why, and then we work those out together. And you know, it's not a transactional day, it's a transformational day. And because we don't want them joining, yeah, we don't want them joining unless they're willing to kind of, you know, join our little tribe here. And if it's not for them, then...
How to Build Cultural Fit Before You Award a Franchise
Gary Prenevost (55:26.584)
That is so refreshing.
Jeff Dudan (55:37.378)
that's great, then I'd rather know now.
Gary Prenevost (55:40.376)
Yeah, yeah. I agree with you. It starts in the recruiting before the franchise is awarded. And great franchise award franchise, they don't sell franchises. I like when franchisers, before they award a franchise, why are you the right fit for us? You're doing a mini CEO presentation as to why you're a good fit for us. And it's not just fluff. It's like, here's why, here's...
Jeff Dudan (55:45.648)
Mm-hmm.
Jeff Dudan (55:49.442)
That's right.
Gary Prenevost (56:09.848)
myself, here's the market, here's I'm going to execute. Here's where I see the benefit of your systems. I think when I coach my clients to have that level of clarity, they might not, the franchisor might not ask for it, but I say there's three sales that have to be made before somebody buys a franchise. First, they got to sell themselves. Then they got to sell the spouse. The spouse has got to be involved. Then they got to sell the bank. And then...
Jeff Dudan (56:27.987)
Mm-hmm. Okay.
Gary Prenevost (56:35.872)
with all those in, then they make sure there's alignment with the franchise or now learning of the alignment of the franchise or happens along the way and the other and the spouse is involved. That's all gone away. But if they can't sell themselves, this is why this is how then they're gonna struggle.
Jeff Dudan (56:54.39)
Yeah, I mean, to your point, which I agree with 100%, the reason that I do that CEO call, and I ask each of them to introduce themselves, and then I point out, I said, well, you're here to hear from me, but I also want you to look around the room and see who else is in the room, because this is the community that you would be joining of these types of people. So if you think that this is a good group and you're impressed with everybody's backgrounds on here, then you're probably at least over the target.
But I have to be vulnerable on that call because I need them to be vulnerable. I mean, I really, you know, the ability to resolve conflict in a healthy manner is the number one thing we look for in a franchisee. We want you to have grit. We want you to have good capital. We want you to have a good financial base. We want you to, you know, have some transferable skills and all of that stuff. But at the end of the day, man, if they can't get along with their neighbors, their customers, their employees, or us,
It's not gonna work. You can't think it's a corporate environment where you're gonna build a clique. I see it, man. Dude, I see it in a lot of consultants, man. They come in, you know, they've, I've worked with billion dollar companies, I've worked with this, I've worked with that, and you know, they've cobbled some money together and stuff, and then they get into a franchise and all they're doing is trying to find things that are broken and then give their advice on how to fix it, and they're not even paying attention to running their business. And it's just not, I'm sorry, man, but it's like, I...
You know, that, that probably is really good for being a consultant, but you're an entrepreneur now and you got the somebody shirt on and if something needs to happen, you can't, you can't talk your way out of it.
Gary Prenevost (58:35.22)
And that acute awareness of what needs to get done, that awareness building starts in the franchise recruiting and understand the model, but once they take on the business, where are they at? Where do they need to grow? Where's the resources to help them grow? What do they got to do themselves? What do they have to hire? All those different elements.
Jeff Dudan (58:40.087)
Yeah.
How Today’s Franchisee Is Different (and What They Really Want)
Jeff Dudan (58:55.682)
Gary, I'm interested to hear from you about the franchisee and how the franchisee has changed over the 30 years that we've been doing this. I see some significant differences. Now, franchising, for people new to franchising who might've just stumbled on this podcast, one of our 250,000 listeners a month, not plugging anything at all, but I would say...
Franchising is accelerating at an accelerating rate. More people are disenfranchised with corporate America. They wanna take control of their own life, but yet they're not really sure how to go out and start their own business. And when you see celebrities like Shaq and Drew Brees and Peyton Manning and all of these people that are joining hands and opening locations, it gives them comfort that franchising is a way to go. Then you dig into it and realize there's over 800,000 franchise establishments.
in the United States and one in every eight people is employed by or with a franchise system and you're like, okay, this is a real legit thing. And there's other non- it's not all food. It's not McDonald's, man, like everything. There's franchises that pick up dog poop, man. There's franchises that paint. There's all kinds of interesting things to look at. So now, so you realize that like Matt Haller, the IFA chair says, franchising is the greatest wealth creation business model ever invented.
Gary Prenevost (01:00:03.832)
Yeah, so maybe.
Jeff Dudan (01:00:19.406)
and you see precedent for that. So more and more, and of course with social media, more and more people are being exposed to the opportunity to franchise. I know in my LinkedIn, I'm getting pounded every, you know, people ask me, are you interested in, would you be interested in learning about a franchise? I'm, you know, I agree. Do you represent any home front brands? Is what I would say to them there. We represent all types. And then eventually they look back at my profile, hopefully, and see that they're trying to sell me a franchise. But...
Gary Prenevost (01:00:46.611)
Yep.
Jeff Dudan (01:00:48.135)
How have you seen the franchisee change, either from sophistication, the way that they go through the process? What can you share about that?
Gary Prenevost (01:00:58.58)
So I think the early days of franchising, like I got into franchising in 91, so it was still a wild west. Pre-franchise law in a lot of places and so there was still, it wasn't as refined, it wasn't as strong a model as it is now, so it attracted a little bit more entrepreneurial
a model. I think a lot of people were looking for something where, hey, I can attach a brand, but I can still have a good amount of operational latitude. Some systems, not at all, because that's part of the system quality control. But I think as things accelerate a few years and franchising really came into its own, the franchise community itself, which I think is a brilliant community, where else do you get competitive brands and competitive systems sharing best practice and ideas?
like the IFA conference next month, if people who are listening aren't going to the IFA, sign up, like you need to be there. So people started looking at the systematization and where can I fit? I think smart franchisees would be franchisees, take the time to look and introspect at themselves. What am I good at? What am I not good at? And where does, going back to what we were talking about today, alignment of values, I think there's a lot more awareness of that now, Jeff.
Jeff Dudan (01:01:54.783)
Yeah.
Gary Prenevost (01:02:24.432)
more so than even 10 years ago. I think there's still a lot of seduction going on. There's a lot of people who are sold franchise. They let themselves be sold instead of understanding what they're buying there. They have unpleasant surprises. It does a lot harder work than I ever thought it would. Newsflash, buying a business is hard work, right? So be prepared for that. So I think there's a lot more transference of the corporate.
Jeff Dudan (01:02:26.424)
Sure.
Jeff Dudan (01:02:39.734)
That's right.
Yeah.
Gary Prenevost (01:02:52.048)
talent into franchise, they look at where they can do that. And that's one of the things that I focus on is really helping people understand where are they good at and where they not good at. I think there's also a greater awareness that it is a lot more than franchise. Like there's a lot more awareness out there in terms of opportunities. There's a thought that's coming in.
the, oh, you know it's on the tip of your tongue and it just doesn't want to come out.
I think the biggest challenge people have now is the, I know what it was, the semi-absentee. There's a movement towards what they think is semi-absentee or passive businesses. There's a lot of franchises being represented that way. And there are some true semi-absent. So I look at it as if there's enough, it comes back to the individual's goals and their talents. If there's enough franchisees achieving at that...
Jeff Dudan (01:03:38.079)
Yeah.
Jeff Dudan (01:03:42.102)
How do you feel about that?
Gary Prenevost (01:03:54.488)
with the franchisees goal level in a semi-absentee model, and they can duplicate that type of group. So hiring the right experience manager, those different elements, then there's a track record and a runway and a path that is the franchise model. If they're amongst the first bunch of franchisees in that system to be semi-absentee, they're cutting tall grass and they got to be ready for some experimenting and it's gonna be more work. So I think people, when they're looking at semi-absentee models,
need to truly understand what that looks like and be prepared that when you lose your manager, you've got to be there. Did you say the anyone shirt or... somebody's shirt, yeah, somebody's shirt. So they've got to be prepared to wear that. They've got to be prepared and that requires flexibility outside of their own element. I see one of the biggest other elements of evolution.
Jeff Dudan (01:04:33.27)
Somebody shirt, yeah.
Gary Prenevost (01:04:52.656)
is, and I think COVID had a lot to do with this. Prior to COVID, we saw a lot of people, I want more control, I want more decision-making ability. I want more, I don't wanna wait for somebody to make a decision. Post-COVID, we saw that control change. They still, strong operational people still want that, but there's a greater demand from my clients who want more control of how their work and personal life integrate. So it's a lifestyle control.
and the importance of relationships and those other elements. I think we're seeing a lot more of that. So they're looking at franchising not just as a business solution, they're looking at as a long-term lifestyle solution. And they're looking at it as a, we're living to our 80s, so they're looking at how do I fund my retirement? I want to stay intellectually engaged. I want something to do to get better choices.
Jeff Dudan (01:05:48.514)
Yeah, I'm involved with an infrared sauna concept. It's retail. It's light staffing. The sale, it's not really a heavy sales model like you might find in fitness. And people are interested in having the semi absentee conversation. And we don't use it. I mean, it's like, look, this is your business. There might, there's a couple of staffing models. And yes.
you know, especially if you do two or three of these things, you can get management to pay attention to this. No one's gonna tell you that you can't hire a manager to do this. But the best owners are, they're available and they're paying, they're checking in. They're looking into the system from wherever it is they're sitting, even though they don't have to be there. They're looking at the numbers 15 minutes at the end of the day, and they're letting those people know that they're paying attention to what's going on in the business.
because anything left to itself always goes from bad to worse. Now, if you grow and there's people in certain systems that own 90 of something or 50 of something, and they have sophisticated centralized organizations that manage the KPI, and they probably manage the managers, or they go to an advisory board meeting, or maybe once a week they get read into what's going on. That's truly an absentee business there. But they don't really start that way.
Um, there are some, right? Some of these big box things where you have, you have 25,000 square feet. You got one person working at the front desk. It's $10 or $20 or 39 dot, whatever it is. Like that's pretty much people are going to walk in and buy. And you, you know, there's not a big sales element there. Nutrition's low, but outside of that, I mean, you know, it's, I'm, I struggle to see the true semi absentee models out there.
Gary Prenevost (01:07:15.699)
No.
Gary Prenevost (01:07:29.401)
Yeah.
Gary Prenevost (01:07:39.164)
You
Gary Prenevost (01:07:43.716)
You touch on a really important part of the semi-absent model, which is the dashboard. I love where there's a dashboard where, as an owner, a non-present owner, I can look at the dashboard from anywhere on the planet, on my computer, video of the feed of the store, and here's how long it took them to get served. Here is what they bought and what the level of service was. Here was the profitability by the service.
Jeff Dudan (01:07:48.782)
Mm.
Jeff Dudan (01:07:58.103)
That's right.
Gary Prenevost (01:08:11.704)
product, the productivity by shift. But like when you have that level of dashboard and, and it compares to system averages, you can really key in on where the training opportunities are for the manager and for the staff. And it's also communicating the goals of like, why is somebody here? The manager has got to be strong enough to be able to lead the people, not manage the people.
Jeff Dudan (01:08:14.307)
Sure.
Jeff Dudan (01:08:22.189)
Yeah.
Jeff Dudan (01:08:37.55)
That's right.
Gary Prenevost (01:08:38.057)
You know, one of the quotes, one of the interviews in my book said, managing is helping people do what they ought to do. Leading is helping people do more than they ever thought they were possible doing.
Jeff Dudan (01:08:51.642)
Oh, I love that. That's great. Gary, any hot any who was that?
Gary Prenevost (01:08:55.145)
Angela Brown.
Angela Brown.
Jeff Dudan (01:09:00.39)
Angela Brown. Okay. Gary, any trends as far as there's 72 categories in franchising, any insights? I know that pets have been kind of hot because everybody got pets when COVID hit. And so now there's all this demand for washing them, walking them, cleaning them, shaving them, all of that stuff. What other kinds of stuff are you interested or intrigued at from a trend perspective right now?

What’s Hot in Franchising? Service-Based, Tech-Enabled, and Recession-Resilient
Gary Prenevost (01:09:30.784)
Interesting. I just had an article published on trends for 2024 and one of my calls this afternoon is with the local news station on trends. The first thing I offer people as a caution is, you know, one of the common questions I get, what's hot in franchising? What's hot is what's sold a lot. It's not an indicator of a trend. It could be hot now, but if the flavor profile of that product or service, it peaks and then declines and two years later, you know, you buy it here and down here, you're in a heap ahead.
Jeff Dudan (01:09:37.898)
Okay.
Gary Prenevost (01:10:00.536)
So I like businesses where it's service-based that, you think about the disruptors, Jeff, you've got technology, AI, what's going to be changing? What are the different elements? How is the consumer buying behavior changing? And how is the franchise or enabling the franchisee to adjust and meet that? So I look at technology not as a trend, but as an enabler of opportunity. So that...
people when they're looking at franchises should be, how is the franchise or helping them do that? And so service-based businesses that are need-based, the more need-based it is versus impulse-based, I think the less risk it is. I think going back to the consumer that you question you asked before, another component is there are a lot more risk averse post-COVID than there were pre-COVID. So, and we saw the transaction three.
three months, four months, maybe to buy a franchise pre-COVID, afterwards it's five to seven months, they're just being more careful. So I think they're looking at the trends. I love businesses that are, people are going to buy regardless of what the economy, beauty, I love the beauty space, wellness, if it's the right model, fitness, those are, you've got, there's, it might be hyper competitive, but how does the franchisor...
with the technology enablers and other systems, enable the franchisee to get their fair share in the market. That would be a quick overview of what I think.
Jeff Dudan (01:11:30.454)
Yeah, you know, we're home from Brands property services. So we are essential services. There's gonna be 100 million more people in this country in 2050. And if you think that's a long way away from now, it was not, you know, remember Y2K? It seems like yesterday. So that's the same time. And housing shortage, houses not built as well, increased migration due to things like Zoom, people moving around all over the place. So.
Gary Prenevost (01:11:49.605)
Well, uh...
Jeff Dudan (01:11:59.37)
Where are all these people gonna live? I mean, it's gonna be new housing. It's gonna be retrofitted housing So you will never find a home front brands Brands, you know tucked between a curves and a blockbuster man Like we are we are as durable and offering for people that want to have a compound annual growth rate year after year After year and build big businesses and we aspire to have a smaller number of large franchisees You know, we aspire to have five to ten million dollar operators
across our brands. We're gonna have a smaller number of brands, but all of our brands have multi-million dollar AUVs. So that's kind of where we're going. It's not a numbers game, it's a quality game with us, and we're privately funded, we're not private equity, so we don't have any constraints. We have the time to make the investments and get there.
Gary Prenevost (01:12:46.476)
Well, I had a construction company, Allaire Homes, one of my masters was Allaire Homes for four years. I love the home improvement space. Anything in home improvement, for all the reasons that you said, home improvement, disaster recovery, it's always been one of our strongest categories.
Jeff Dudan (01:12:53.512)
Okay.
Jeff Dudan (01:13:02.09)
Yeah, yeah, awesome. Gary, this has been amazing. I really enjoyed our conversation today. Is there anything else that you wanna touch on before we head towards the wrap-up?
Gary Prenevost (01:13:14.181)
There's so much we could talk about. I think most important thing people want to take away from as they're in business is focus on the next growth area. Get out of the comfort zone. The comfort zone is a good resting place and when we're resting, we're recharging, but you stay in the resting place too long, it becomes toxic. We ease off the gas and things start to decline. Use that as setting your next growth target.
Jeff Dudan (01:13:28.7)
Mm.
Jeff Dudan (01:13:38.922)
Nice, well said. This may be duplicitous, but the question I have for you, a wrap up question is, if you had one sentence to make an impact in someone else's life, what would that be?
Gary Prenevost (01:13:54.096)
To thine own self be true. Do what you love. If you don't have enough of what you love to do, make a change.
Jeff Dudan (01:14:00.942)
nice, perfectly said. Gary, where can people get in touch with you?
Gary Prenevost (01:14:06.757)
the unstoppable franchisee.com. That's my website for my book, my keynote speaking. And then the FranNet is there. That would be the best way. Or gpre is my email.
Jeff Dudan (01:14:21.47)
Awesome. Gary, thank you for sharing your time with us today on the home front. And everybody out there, thank you for listening.
Gary Prenevost (01:14:29.912)
Thank you. It's been a pleasure.
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