NFIB

The Franchising Road Can Be Hard, Expensive
08/ 15/ 2002

by Melany Klinck

Five years after franchising Pickles and Ice Cream maternity fashions, Kelly Fleming says she'd do it all again--but differently.

"What I didn't know was how much I didn't know," says Fleming, who was a stay-at-home mom of two toddlers in 1996 when she hit upon the idea of selling stylish maternity apparel.

She bought $8,000 worth of manufacturers' samples from the Atlanta Apparel Mart, sub-leased a corner of a stationery store in Augusta, Ga., and began selling clothing four days a week by appointment. Business grew, and a year later Fleming opened her first boutique.

Three months after hanging her shingle, two women approached Fleming and asked if she'd help them open a similar store in Birmingham, Ala. Fleming agreed and licensed them the name Pickles and Ice Cream. The ink had barely dried on that agreement when another woman inquired about opening a store. Fleming found herself drawing up a Uniform Franchise Offering Circular (UFOC) and plunging into the sea of franchising.

"It was kind of an accident," she says. "I didn't sit down and say ‘this is a great concept, I think I'm gong to franchise it.' But when people contacted me, I knew there was a niche."

Hard lessons

Her fledgling franchise soon ran into trouble. Sales in the home store began to suffer, especially in the spring of 2000, when Fleming was opening three stores within 60 days of one another.

Hiring a full-time manager/franchisee trainer helped. So did developing written policies, procedures and forms. Still, problems kept springing up.

Her biggest frustration? "I wasn't prepared for the fact that franchisees had brains of their own," she says. "I had to justify my decisions. I couldn't just tell them, 'This is the way to do it,' I had to give up a lot more control than I expected."

One franchisee insisted on paint colors that Fleming felt conflicted with the clothing. Another balked at installing the recommended display fixtures. Both were issues Fleming felt strongly about, but, since neither were addressed in the operations manual, she ultimately had no recourse but to give in. Today, an extensive operations manual stipulates paint colors and fixture requirements.

Another shock for Fleming was the expense. "I had no idea it would be such a long, hard road to positive cash flow. The cost of opening a franchise, with hotels, meals, travel and salaries, turned out to be close to the actual franchise fee, if not over," she says.

Words of Wisdom

Fleming's most important lesson: "Make sure your concept is profitable enough so that your franchisees will be able to make a decent salary and pay your royalty--or you're going to fail."

She also advocates hiring an expert to pinpoint what makes your concept work in your market. Then target similar markets for expansion and create a business plan detailing how you're going to sell your franchise in those markets.

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This article originally appeared in the August/September 2002 issue of MyBusiness magazine.

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