The little gymFranchise fee: $49.5K - $69.5Kminimum Investment Required: $250KAn organic organization, The Little Gym grows when potentialfranchisees seek them out, not the other way around. It’s a tacticthat works well for this Arizona-based franchise with about 260mainly suburban locations, 18 of them in Canada, and 10 ofthose in Québec.

Started in 1976 by Robin Wes – a musician, teacher, and ki-nesiologist – The Little Gym promotes physical well-being,learning, and social development for kids ages four months to12 years old, mainly through gymnastics. It also books birthdayparties and parents-nights-off.

“We’re not trying to create gymnasts,” explains Bob Bingham,President and CEO, who estimates that Canada can house about45 locations. “We’re trying to improve balance, coordination,and agility, interspersed with intellectual development.” They callit ‘serious fun.’ “All the kids know is that they’re having morefun in that hour each week than any other hour.”

Each lesson has its own soundtrack; there is a huge lessonbank and new ones are constantly created. Rigorously plannedlessons (a mirror of The Little Gym’s rigorous franchisee train-ing) takes the pressure off instructors, as instructions for thechildren are embedded in the soundtrack: “Now freeze! Nowgallop! Go find three red balls!”

Activities are so fun to watch that franchisees are tempted toabandon their post to hang out in the gym, the bulk of their2,500 to 4,000 square foot location situated in neighbourhoodmalls or industrial parks.

Franchisees greet interested parents drawn in by a free intro-ductory class – The Little Gym’s main marketing strategy. Manysee the benefit immediately and sign on the spot, says Bingham.

Some sign up for a lot more. In the past five years, more thanhalf of new franchisees were former The Little Gym parents; all areoutgoing, animated, and have business savvy. Many have steppedoff the corporate ladder after seeing that with each new rung comesmore working hours, not fewer. Franchisees spend about 50 hoursweekly to start, cutting back to 40 in the second year.

“It’s good for people who care very much about children,”says Bingham. “Our franchisees want to make the world a betterplace for kids.”

edo JapanFranchise fee:$30K (food court) - $35K (streetfront)minimum Investment Required:$300K (food court) - $450K (streetfront)A newcomer when mall-building was in its 1980s heyday, EdoJapan is a mall staple that, of necessity, is now expanding throughits streetfront concept.

“We’re able to define our brand a bit better; it’s a bit moreupscale,” says Tom Donaldson, President, of the company’s free-standing locations. The exhibition kitchen, with its teppan grill,remains key; customers savour knowing their food is beingfreshly prepared.

This Calgary-based franchise, which opened its 100th loca-tion this year, is infilling the western market, planning to add25 to 40 suburban units in the next five to seven years, beforedoing the same with its eastern group.

Both mall and street front locations pull in a diverse crowd.“It’s amazingly broad: seniors, families with young children, highschool kids, couples,” notes Donaldson. “Customers tell us dailythat they enjoy our food, and really like our people. We have very

ShOw me The Money

By Alison Ramsey

experience is the backbone of these franchises, which all have longevity in their favour.

FranchiseCanada March | april 2012 73

74 canadian Franchise association www.cfa.ca

strong repeat business.”In-house research

shows that more than 10per cent of mall dinerschoose Edo Japan, andmany come more thantwice a week. Franchisees– selected partly for theirfriendly demeanour – areequally loyal; few leavethe system.

“Our franchisees areattracted, first, by the vo-cation,” says Donaldson.“They want to deal withemployees and cus-tomers, and enjoy beingon their feet. The financial reward is a bonus.”

Staffers tend to stay longer than average, because the franchiseis successful. “Our crew is generally happy,” reports Donaldson.“Happy people tend to deliver better service. If you have ahealthy restaurant where you’re making a good living, you canpass some of those benefits along to staff, and that flows throughto the customer.

“Every time you have a customer interaction, it’s marketing.Either you impress someone or you don’t.” The cumulative ef-fect of decades of positive customer interactions is “like a freighttrain. It’s a big machine that’s hard to get going, and hard toslow down. It’s been great for the brand,” he says, “better thanany traditional advertising.”

Head office keeps the concept limber by refreshing its menuboard six times a year, and revamping it every five years. Someitems are new, but its signature Teriyaki Chicken and SukiyakiBeef have always dominated Edo Japan’s empire, and probablyalways will.

la prepFranchise fee: $35Kminimum Investment Required: $300KAt la prep, variety rules.

Franchisees arrive early to prepare each day’s rotating selec-tion of colourful salads (six of 40 stock recipes), sandwiches, andfresh-baked goodies that stock the shop’s eye-catching displays.“Customers tend to eat with their eyes first,” says President JohnEssaris. “If it’s presented well, you have a much better chance ofmaking a customer a future loyal customer.”

Though the la prep name is just two years old, this franchisebegan in Montreal as Café Supreme in the early 1980s. Thename change was done to stop potential clients from assumingit was just another fresh-ground coffee shop and to reflect itsfocus on fresh edibles, which account for 70 per cent of sales.

Now at 50 units, la prep is aggressively expanding into air-ports, universities, and more urban locations, including officebuildings and food courts. Comfy chairs complement traditional

tables in locations from 400 to 1,500 square feet.Québec City, Montréal, Ottawa, Toronto,Calgary, Edmonton, and Vancouver are all tar-gets. The Greater Toronto Area alone can handleanother 40 to 50, says Essaris.

Recent marketing includes billboards onToronto’s busy Gardiner Expressway with lus-cious food photos and a cheeky message: “Getfresh with your co-workers.” Women are laprep’s strongest supporters; they represent morethan half of both customers and franchisees.

“They caught on first to healthier eating,” says Essaris, whobelieves that men will inevitably follow. “Everyone’s livinglonger, and they want to make sure that they can enjoy their re-tirement. To do that, they need to eat well.”

la prep understands that its menu must appeal to diverse tasteprofiles and even gets suggestions for new menu items from itsmany repeat customers and franchisees. The brand seeks new,exciting combinations and mouth-watering twists on oldfavourites, like its gruyere and Swiss cheese sandwich, with appleand sage on multigrain bread.

Food costs are a key challenge, especially during January andFebruary when produce prices soar, but recipes to ease that bur-den are part of la prep’s planning. But the accent always remainson freshness and being green.

“We have a variety of products on any given day; it sets usapart,” says Essaris. “Our food is skewing a little healthier andwe feel that the variety that we offer makes us a little more in-triguing.”

hand & Stone massage and Facial SpaFranchise fee: $39Kminimum Investment Required: $275KHand & Stone Massage and Facial Spa isn’t a typical spa.

First off, clients here don’t lounge around all day inbathrobes, sipping chai. Customers are busy people who book60- or 90-minute appointments. Secondly, 60 per cent of itsbusiness is same-day or next-day bookings. Thirdly, these mas-sages and facials are priced lower than the going rates.

The name may not be familiar to you: Hand & Stone startedin the U.S. and debuted here in 2008. Why, then, can it begrouped with long-time franchises? Because the Canadian licenseealso owns Kwik Kopy Canada, a successful franchise for 33 years.

Vice-President Duncan Macpherson says Kwik Kopy realized

ShOw me The Money

it had the resources – tenured staff, a building, the know-howand everything an established franchise requires – to take on an-other concept.

It wanted a simple business model. Operating Hand & Stonedoesn’t take years to perfect; franchisees manage registered mas-sage therapists and licensed estheticians. It wanted a growingmarket. A Tourism Canada study forecasts continued growth ofthe country’s $1 billion-plus spa industry. It wanted repeat busi-ness. Most Hand & Stone first-timers are covered by extendedhealth benefits. The spa then keeps them coming back with of-fers such as a “lifestyle membership,” a flexible monthly servicecovered by benefits that gives clients further savings.

It wanted multiple income sources. The Spas specialize intraditional massages, their signature hot stone massage, facials,waxing and aromatherapy. The Spas recently introduced a verypopular peppermint scalp massage – everyone loves their scalpmassaged, just ask your local hair stylist or barber! A big advan-tage to Canadian franchisees, the U.S. corporate office tests allnew products and services State-side prior to bringing themacross the border.

It wanted ease of single owners handling multiple locations,a Hand & Stone reality. “If you have good staff, you’re almostgetting in the way” once the franchise is running smoothly, saysMacpherson.

Hand & Stone attracts executives and entrepreneurs who cancomfortably visualize themselves owning a business in the spaindustry says Macpherson. Expansion has focused on Ontario,but additional regional license opportunities are likely to followacross Canada. A master licensee for Québec is being sought.

Locations measure up to 2,500 square feet, accommodateabout nine treatment rooms and work best in areas with com-patible co-tenants where women frequent, as they account for65 per cent of clients, such as big box stores, gyms, hairdressers,or other shops with ample parking. Its current seven units arebut a start to what Macpherson envisions as another franchisethat will be able to boast exceptional longevity.

Clintar landscape managementFranchise fee: $40Kminimum Investment Required: $300KRobert Wilton launched Clintar Landscape Management in1973. “Looking back, it was probably very risky,” he admits.“There was no role model. I was out on the end of a diving board.”

The snow removal and landscaping industry was dominated

by individuals operating out of their trucks when an acquaintanceasked Wilton, a recent business administration graduate, to joinhis weed-spraying company. That job sparked Clintar and, adecade later, the company began franchising when Wilton real-ized how the franchise business model he’d studied in universitycould work well in expanding his grounds maintenance business.

Rather than digging up weeds, franchisees should be preparedto dig into the management side of business. Franchisees openwith six to 12 full- and part-time employees; winter crews are oftenguys who work construction in the summer, while summer crewsare often gleaned from colleges that teach landscape technology.

Finding and retaining employees is one of this franchise’sbiggest challenges. Wilton’s recipe for success in this area is sim-ple: “Pay them properly, and treat them with dignity and respect.”

Founding the franchise was a risk, but growing it wasn’t.Wilton maintained a conservative approach; the franchise has20 units, in central and eastern Canada. “I spend time and en-ergy to make sure that each franchise is healthy financially,” saysWilton. “The average franchisee revenue is over $2.5 millionannually, ” making for a group total of $52 million.

Clintar thrives on 12-month contracts, 99 per cent of whichare with commercial property owners. Franchisees must be pre-pared to leave the office to knock on doors. The target marketis Fortune 500 companies and large malls.

Not surprisingly, people who enjoy working with others andbuilding and maintaining relationships have great potential. TheClintar franchisee in Atlantic Canada’s smallest market is proofpositive of this: a small-town boy who knows everyone in histerritory, he outperforms all others in the region. Sales and mar-keting experience is a big plus.

The drive to succeed, however, tops the must-have list.“Drive,” says Wilton, “leads to longevity.”

Clintar’s own drive to expand is revving up. One locationin West Palm Beach, Florida and one in New Jersey have beenopen for five years and are among the company’s fastest-grow-ing units; their success has sparked plans to grow along theentire eastern seaboard.

FranchiseCanada March | april 2012 75

To learn more about franchiseopportunities available for$250K to $500K, visit:www.LookforaFranchise.ca