Are you retiring from the military and considering a career in franchising? Do you want to learn more about what it's like to own a franchise? Then you don't want to miss this episode of Chasing Financial Freedom with Stacey Marmolejo. Stacey is the founder and CEO of Franchise Prep Academy, which helps soon-to-retire military personnel navigate the franchise industry to evaluate if a franchise is their next career. On this episode, Stacey shares her insights on the franchise industry, including what to look for when choosing a franchise and how to finance your purchase. Don't miss this episode!
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[00:00:00] Ryan: Hey guys, Ryan DeMent from Chasing Financial Freedom Podcast. I hope you guys are having a great day. By the time this episode airs, it will be after Halloween, but I will wish you guys a happy Halloween because we are recording on Halloween day. This week's guest is Stacy Marmolejo, and I think I got that so we're close.
And she said I did it right the first time, but we'll bring her in. We. Stacy is the founder and CEO of Franchise Prep Academy, which helps soon to retire military personnel navigate the franchise industry so they can evaluate if a franchise is their next career. Stacy, welcome in show. Ryan.
[00:00:40] Stacey: Thanks so much for having me.
[00:00:42] Ryan: it. , You are more than welcome. So before we get into what you're doing and how you're helping the veteran community, tell the listeners a little bit about who you are.
[00:00:52] Stacey: I started my career in corporate America. I actually wanted to be an entrepreneur when I was in college, but my dad was in the military and my mother was scared to death that civilian life was like this creepy place that, that women shouldn't go, and I should have joined the military.
So entrepreneurship was way too far out for her comfort zone. So I went into corporate America for 25 years. I became a senior vice president of a national company, but I still had that itch to own my own business. So I bought a franchise in the music. Teaching space because my son was into music.
I did that for 16 years, sold it for a nice healthy profit, and I decided I was going to retire at 62. So I walked around my house for a couple days. I was like, I am so bored. What the heck did I do? I've got to do something. My mind is going numb. So I talked to some friends and they were like, you should teach people about the franchise industry because.
Are franchise consultants, and that's where a lot of people get their knowledge. But franchise consultants are paid by the franchisor when they introduce somebody to buy it. . So while they will teach you about it, Most times they're just answering your questions as opposed to taking you down a particular path.
So I created the Franchise Prep Academy so that I can help people in one month understand from start or start to go or stop to start all about the franchise industry so they can know if that fits into their dna. And as I was moving along, I discovered that it was really the vets who created the franchise industry as it is today.
So veterans came back from World War ii. and there were no jobs, but there were a few franchises to be had. And so some of the guys, and they were mainly guys in World War II, bought these franchises and then they hired other vets to work for them and it really grew the franchise industry. And now one in seven franchises is owned by a vet.
But when I went out looking, I couldn't find anybody teaching specifically veterans about franchising. And with my dad's history we're actually a family of 10 generations of military. So with that background, I was like, Oh, that's how I can give back for everything the vets have done for us.
So that's why I honed in on the vet community.
[00:03:31] Ryan: That's really cool. 10 generations will have to talk about that. So that's, thank your family for all their service and what they've done, cuz that's we need that on a, every single day. I, if I find a vet, I always thank 'em. They always look at me and it's always strange to hear how they react.
And I know they don't. They just, they're doing it because it, that's their passion. It's their
[00:03:51] Stacey: calling and it's their humility and they don't know how to respond. I saw something the other day. I know we're off topic, but I saw some No worries Day, and it was like when you say to a vet, Thank you for your service.
They don't wanna say You're welcome, because that makes them sound braggadocious. Yeah. They don't wanna say thank you for a thank you. So they're kinda like okay. .
[00:04:13] Ryan: Yeah, it's I've had several vets on the show and when I thank 'em it's pretty hard. And one actually works with other vets that are having some tough time with PTSD and some other, Transitions out of military life to civilian life.
And he said, You know what? The best thing you can do a at from their response is, you thank him. And then he goes, It was my calling and I loved serving my country. And he said that helped him be able to get past that awkward moment. That is an
[00:04:42] Stacey: awesome response.
[00:04:44] Ryan: Yeah. So I thought that was really cool.
He does a lot with the military and the veteran community, and he's in Clarksville, Tennessee right by, Is that by Fort Campbell? I think that's where that's by, Yep. Yeah yeah, so that's really cool. So well shout out to him
[00:04:58] Stacey: for helping them too.
[00:05:00] Ryan: Yes, he does a lot. And I'm gonna try to bring him back on the show.
He's got a lot and he's got a pretty cool podcast. The Misfit Nation podcast. I, Yes, the mis. Nation podcast, so take a look at it. Yeah. Rich Lamonica. So he does some pretty cool stuff there. You spent many years in corporate America and you decided that you were gonna really serve, military veterans.
How did you start, cuz there's other people out there that are wanting to help the military and the veteran community. How'd you get started? Yeah.
[00:05:30] Stacey: That it, and it was a. It was a slow climate first, to be honest with you, because the military and the veteran community is pretty, they're a tight knit group of people.
. And so they, they want help, but they're a little. Leery of some stranger coming in. But once I reached out to veteran organizations and explained who I was and the fact that I was a GI brat and all of the connections to the military, including, shout out to my cousin's son, Ben, who's in his first year at the Naval Academy.
Oh, cool. Yeah, so the tradition continues. I found that when you lead with your heart and you lead with sincere purpose and you just reach out to help that they feel your sincerity. From there, it's just been one, telling another and, it's I don't, I will have everybody do like a risk assessment.
And if they don't, if they don't fall into that risk assessment level of an entrepreneur tell 'em that. I'm like, I don't think you'll be happy. You'll be so stressed out. So I think that kind of also helps because we're being honest with people up front. We're not just taking people's money. So they did, I think it's just word of mouth more than.
[00:06:55] Ryan: Just outta curiosity, how many actually fit the mold of an entrepreneur versus not Percentage.
[00:07:02] Stacey: I think by the time they get to me, there's a statistic that says 25% of military personnel want to own their own business when they get out. And I think by the ones who come to me already know deep down in their gut that they wanna own their own business.
They either think they can't afford it or they think they don't have the skill set for it. . And so when we do the risk assessment, that's not usually the problem. The problem is their lack of self confidence, thinking that they don't have the skill set. And that's why I think franchises are the best first business actually for anybody to own.
Because. Like me, I came out of corporate America as a senior vice president. I had run a division, and I'm like, I know how to do this. There's a difference between starting a business and running a business and a franchise has already started the business for you, so you get to leapfrog that starter phase of a business, which is oftentimes where most people fail.
The other thing is franchises are easier to get funding. Because banks can look at the franchisor and all of their franchisees to see how they're doing and extrapolate the whether you could do that or not as well. So the risk is lower for the bank who's loaning you money. So for those reasons, most of the people who come to me, I'd say 80% are actually in a good space to consider a f.
Now of those that I work with, I would say once we get through it all, 70% say, Yes, I wanna do this. And the other 30% are either like, I'm gonna go get a job or I'm gonna start something on my own. And one of the reasons for that, . I would say the primary reason that I see for that is because there's a commitment, There's a contractor signing.
. Some people think that they can buy a franchise and if they don't like it, they can just walk away and that's not the case. You're signing a contract and it's usually five or 10 years. So that's also one of the things that we look at when I work with that is how long of a commitment do you wanna.
It's kinda like re-upping, right? Yeah. So join the military and you're in it for a while and you decide whether you wanna re-up or get out Franchising's the same way five years in. If you decide you don't want it, you can get out 10 years in whatever the contract is. However, the good thing about a franchise is it's like a starter home too, right?
You start. You build up some equity in it, you get some revenue stream coming in, and then if you decide that you don't wanna re-up, you can sell it. You have an asset that you can sell, and then you can take that money and reinvest in either another business, your own business, or a different franchise.
[00:09:56] Ryan: Wow. There's so much to unravel in there. But we can start from the beginning. Yeah. The first piece that you talked about, corporate America didn't teach you how to run a business or own a business, and
[00:10:06] Stacey: they taught me how to run one. It didn't teach me how to start one,
[00:10:09] Ryan: start one, but there's, the running piece is also in there because I too struggle with it.
I'm a two time tryer at entrepreneurship. I'm on my third try, and the first two times I failed because of corporate America. They kept me fat and happy. I didn't know how to fish. So being able to not just start, but then the, all the other aspects that go into it. I can be a great leader and I can manage processes and work through people and so forth, but at the end of the day, And entrepreneurs more than that.
You've gotta wear so many different hats. And I can see where you're going with a franchise. Me personally, I would have a problem with a franchise just for the simple fact because I feel like I'm stuck in a box. But I'm sure there's more leeway there it's just me. That's just my personal take it.
[00:10:54] Stacey: Actually you're right on some of. So that's another thing that has to be explored is like, how much creativity do you want? How much leeway do you want? How much do you just wanna be handed the SOPs, standard operating procedures and execute to precision. And that's really what military personnel are so good at.
Oh, good at, Yes. And that's another reason that, that franchises work so well for 'em. But like my franchise was a. and so we had a lot of leeway because they hadn't really figured out their rhythm yet, but by the time I sold it, they were more mature and therefore less Lee. So to your point, that is another element and that's a reason that some people don't like franchises.
They don't wanna own a franchise cuz they wanna do things their way. And so that's again, another thing that we cover in the Franchise Prep Academy because it's really important, that going in and there specific questions you can ask when you're talking with a franchisor to get to the heart of how much.
Dictated as some people would say. And how much is flexibility
[00:12:01] Ryan: And I don't know if you bring this up with your clients, but is there like a middle road to where you could help them potentially buy an existing business? Absolutely. Okay. So in today's age, unfortunately with everything craziness going on, me personally, I probably get solicited between five and 10 times a week of businesses for sale.
And. and they're baby boomers, which my parents are the same thing too. And I see a trend that's been building since Covid happened and it just, it starts building up and up. And we are talking on our pre-call that the full service car wash company I used to work for in gas stations.
Several of their owners are retiring and they have full service locations, but they also have self-service locations. I don't want to be in the full service. It's. Talk about 24 7, 365. Never shut down. And you gotta manage the convenience store, the gas levels no thank you. But the self-service piece and existing self-service car wash, you can put additional revenue streams on it.
And it makes a lot of sense in, it's very easy to manage initially. It's keep the wands going, making sure you've got the right pump. If you're in a cold area, make sure you've got warm water coming through the. And then additional things like we talked about ice machines, water vending. I like your doggy dog, your doggy washy location, whatever.
Doggy bass situation. So
[00:13:23] Stacey: service, sweat washes. That's another franchise too. Yeah,
[00:13:26] Ryan: it's another franchise. That's just another thing that's out there. It's just, it's amazing when you start digging into some of this stuff, what you can actually do and how it makes sense. And I was, while we were talking, I was think, or while you were talking, I was thinking about this.
Why didn't I think of this before? Because all the heartburn headache that I've gone through with two start three startups today, I wouldn't give up the experience. If you asked me before, after my first one, I probably would've given up the experience and said, Okay, let me find, let me buy an existing business.
[00:13:56] Stacey: Yep. And again, that also depends because your existing business is probably gonna cost a little bit, maybe a lot more. Yeah. Because you're buying a revenue stream as well. And like the man who bought my franchise, it was the same thing. He could have bought the same franchise as a startup in a different territory, or he could buy mine who all, which already had almost a million dollars in revenue.
And so for him,
[00:14:24] Ryan: Go ahead. No,
[00:14:25] Stacey: go ahead. I was gonna say for him, he preferred buying into the business that was already cash flowing, even though it cost him a little more than it would have to start up. But ironically, not a lot
[00:14:39] Ryan: more. Yeah. And then the other thing is, and I don't know about franchises, but there's creative ways to finance deals like this.
We could talk self-service, car wash, whatever you wanna talk about the owner, If you find the right owner, they'll actually potentially carry the note for you. That's what I Oh, you
[00:14:57] Stacey: did . That's what I'm doing. Yep. I'm carrying his note for three years. Smart lady. And then there's a. . Yeah. Then there's a balloon payment after three years.
[00:15:07] Ryan: Yeah. Yeah. That's great. You give, there's, I'm looking at different ways you could slice and dice it to where, let's say you come up with 15 or 20% down. You keep the owner you give revenue to the existing owner at 50% or 60% and u 40% or 50 50. You can slice and dice this in so many different ways.
You just. , you just have to talk and have a conversation. So how does that play to the veteran community? Are those type of topics come up or is it just strictly, franchising?
[00:15:36] Stacey: So with my clients, we mainly talk about franchising because I'm mainly working with people who don't have a lot of business experience, but even more than that, they.
Know the value they bring because so many of the coaching services, for transitioning vets is all about how to get a job, how to get a job, how to get a job, and then it's about how do you translate your military? Services into civilian language. And if you look at some of the research, one of the biggest challenges that vets feel when they get out is they feel like they don't belong.
So that's another reason I think franchises are so good for military people is because it's about serving a greater good. If you open, since mine was a music store, if you open a music lesson shop in town and you wanna reach out to another music lesson owner for advice, your competition's not going to tell you what they've learned over 10, 15 years.
You're a competitor. Yes. If you're in a franchise, environ. . I could always turn to another franchisee and say, I'm struggling here. How did you overcome that? And they're more than happy to help. It's for the greater good of the brand. And then what is that? All high tides rise all boats, right? . And that's the mindset of the military, and that's the mindset of FraNChiS.
[00:17:12] Ryan: I like that. It's straightforward cuz when you're an entrepreneur, you or you're running your own business, you're on your own island. Unless you have, and I'm gonna go back to it. Anybody you started, I gotta digress even more. You started about the coaching business. . What a sham and craziness that can be, but
[00:17:28] Stacey: Right.
[00:17:28] Ryan: gosh. Yeah. Everybody is a coach. was, find a
[00:17:31] Stacey: word other than coach or consultant, just cuz I didn't want that label.
[00:17:36] Ryan: Yeah. Oh no I'm with you cuz people still come to me from my prior business and stuff like that. I call myself the Unco. I'm not gonna coach you to do something. I'm gonna support you.
Help you. But I'm not gonna drag it out for six, seven months. This is gonna.
[00:17:50] Stacey: Minus 30 days. That's it. Yeah. That's all I have you for is 30 days. And 30 days you'll know. And it's three days a week for just a couple of hours because people have lives to live, right? Correct.
[00:18:02] Ryan: Yeah. Sorry to interrupt. No.
It's crazy that, that happens, but when it comes to that I really like. Thought process that you can reach out to another franchisee and say, Hey, I'm struggling in this area and I see you're excelling. Can you help me out with that? , when you're on your island as an entrepreneur, you can't, but there's one way you can you can combat it or you could bri take it on, is you gotta have some, you have to have mentors and.
And this could be with veterans and also anybody that wants to be a business owner, franchise owner. If you're not surrounding yourself with people that have been there, done that, or smarter than. How are you supposed to up your game and be able to move to the next level? Especially if you want to be a franchise owner.
You wanna be a business owner even in a job or whatever you're trying to do. And when I talk to people and they're like, Oh yeah, I'm a coach and I'm doing this, then this, and I'm like, Okay, cool, whatever. One of the questions I always ask is, So what does your mentor think of what you're doing? And it always throws 'em off.
They're like, mentor. You don't have a mentor? I've got three. I'm working on a fourth one. Yeah. Yep. But it's for different aspects of my life and I don't know how to describe it other than I've seen more growth as I've added a mentor in my, a specific part of my life than I did not, I thought I could do it on my own.
And as soon as you can realize that you can have a team that supports you and mentors that'll help you grow. Your life changes.
[00:19:29] Stacey: Yep, absolutely. I belong to the most everyone thinks their own is the best, but I belong to the best mastermind and I have a wonderful coach. Two very different things.
They serve very different needs. But again, that's one of the reasons I like franchises as a first business is because you don't know what you don't know either in buying a franchise or even after you buy a franchise or start your own. None of us know what we don't. Don't know what we don't know. So with the franchise comes a marketing person, an IT person, an operations person.
This is your support team. That's what you're paying your monthly royalties for. . And for those who don't know, when you're in a franchise, X person of your revenues go back to the franchisor. And some people think I don't feel like I should have to pay that. And it's have you ever tried to.
A marketing department, an IT department, an operations department, those people cost a lot of money. So the amount that you pay back to the franchisor is nickels on the dollar compared to what you'd have to pay if you went out on your own and bought all that support. But again, they've been there.
They're working with all the other franchisees in the network. They can tell you what's working, what's not working. If you're in a great franchise, you actually have somebody assigned to you for at least the first year to hold your hand, to have weekly calls with you to go over all of the elements of your business.
That's what a mentor does. If you opt to go into an independent business, you, like you said, you need that. Cause you don't know what, you don't know exactly what you do. And there's still lots of stuff. I don't know ,
[00:21:15] Ryan: but that's, So I got asked the question, the mindset of a veteran that's coming out and transitioning for a franchise.
Is it the timeframe that they have to dedicate to the franchise? The five or 10 years? Or is it money? What I mean, I know we talked about it earlier about some of the obstacles, but when I'm just gonna apply to myself, When I look at a franchise, I'm thinking, and this is just me thinking off the top of my head, Chick-fil-A, which you have to work there and you have to be internal, and it goes through a whole nother process.
[00:21:44] Stacey: what? You wouldn't even qualify for one. Chick-fil-A has so many people wanting to buy that franchise. Yep. That they are very particular and.
[00:21:56] Ryan: Oh yeah. And they're giving 'em away for $10,000. Once you've gone through that whole process, but like a McDonald's, that takes hundreds of thousands of dollars to get into that network.
But you have to bust your hump initially Exactly. To go through that process. So what type of franchises do veterans typically look at or you work with that makes it to where they can jump right in, feet first and feel like they're part of a.
[00:22:22] Stacey: That is such a great question because most people look at franchises and Chick-fil-A and McDonald's are usually the thing that comes to mind with people.
Yep. When people think of franchises, there are actually 4,000 franchise brands. Available. Wow. And it used to be a franchise was a brick and mortar store. . Now you can get franchises, brick and mortar work from home, full-time, part-time, absentee owner. It's . If there's a business model for it, there's a franchise that fits into it.
The other thing is, and this is where particularly. The people who have spent less time in the military. If you get someone who's been in 20 years in retiring, they had a pretty high rank. They've got more retirement income, they've got more to spend. But if you've got somebody who did four and got out, they don't have Yeah.
A big bank account, right? So a lot of them think I could never afford a f. So a few things before we get to, what franchise do you want? As I said, we do the risk assessment. We do a core competency, we do a motivator assessment, and we do a personal financial statement. I have a network of 65 different types of funding.
Because a lot of people think you're gonna go to one of the major national banks to get funding, and that's the worst place a startup business could go. Franchise or not. Because think about it, if you're a banker and you're starting your career at US Bank, who is US Bank going to assign you as your clients?
The newbies? It's newbie to newbie. And you don't need a newbie banker. You need an experienced banker. because that's going to be another mentor, that's gonna be a financial mentor who cares about your success. . So you wanna look at either a local bank or a regional bank. But in this economy, very few banks are lending money for startups, be them franchise.
You gotta have a better chance with a franchise. Statistics say, Segue, the SBA has set aside X number of dollars that they only loan for franchises. So there's a bank there. Having said that, everyone is not gonna qualify for a bank loan, but there are so many different places to get money now.
You don't wanna find them on the internet because just like coaches, there's a lot of scams for lending money. Ah. So you need to go the reliable sources. So you need to be introduced from some, a reliable person, right? That, that, that's my high horse. I'll step off of it now. So when you come, we don't start with what franchise do you want?
That's every, everyone wants to go there first. You go get a massage and you're like, Ooh, I wanna own a Massage. Envy. Your kid takes a magic lesson at School of Rock and you're like, I wanna own a School of Rock, because it's your experience and that's all you know. . But we take a step back and we start with you.
What do you like? What do you know? What is your experience? How much money do you have to spend? And then we'll start looking at franchises. Do you wanna work full-time, part-time in the business? On the business? What? And then we start narrowing down the options because then we're gonna find something that fits you, not you fitting them.
Does that make sense?
[00:25:51] Ryan: Oh, makes total sense. I think that's a great approach because I guess my first question and I'm gonna ask 'em in a series, I guess as it pops into my head, is when you have somebody that, let's say, only did four or eight years, they're typically not gonna have very much money in the bank.
So I'm just curious how many franchises are out there that they could qualify for. So
[00:26:13] Stacey: what I say, I'm I made a mistake when I bought mine cuz I knew nothing. I did what I just said, Don't do . My son went to a music camp and thought it was the greatest thing. We didn't have anything like that in our town.
So I bought a franchise that did that cuz if my kid wants to do it, other kids must wanna do it too. Don't do it that way. . There are. So I put all my money in. I emptied my 401k, I refinanced my house. I paid for the whole first one. I used US Bank, Sorry, don't mean to say US Bank, but I used US Bank.
And then I went and I said, Okay, I'm ready to open number two, give me a loan. And they were like, Oh no, this is a new business. You need to put skin in the. . I was like, I put all the skin in that one. So that's something that we talk about in Franchise Prep Academy as well, which is don't put all the money and use other people's money.
Amen. Yep. So if you look at a franchise that's gonna cost, I'm not gonna be able to do the math. $30,000 just so I can do the math. Okay. $30,000, right? You only wanna put 10,000. And it's gonna be easier to get 10,000 on your credit card. You're gonna have to put skin in the game. Let's be real, because if you don't, it's too easy to walk away if the going gets tough.
Of course. But if you can bring 10,000 to the table, then there are lenders who are gonna bring the other 20. Or if there are franchises that start at 15,000 and some people will be like, But that's not what I want. . Think about it like a starter house. If your goal is to be an entrepreneur, start with gotta start somewhere.
Business learn, flip it, and invest the money in a bigger business just like you do
[00:28:02] Ryan: a house. Exactly. I do that all the time. house question. Yes, I have a question. So what about if I come with other people's money for the down payment? Is that allowed through the franchise? Absolutely, yes. Nice. That's interesting.
Yeah, because that's, that's how I look at business is if I'm gonna go buy these car washes, or I'm gonna go buy ice vending machines or water machines, I have a group of investors, I can pick up the phone and say, Okay guys, this is what I'm doing. I'm gonna put a little deck together, a little video and show you what we're doing, and then I'll get the numbers and share it with them.
More than likely two or three of 'em are gonna bite and say, I love it. I'd love to do it. Especially now that I think this is the last year that you get a hundred percent depreciation on anything that's real estate based or service based or machine based from the Jobs act that was passed in 2017 to where you can depreciate that straight across the board so that total purchase.
Written off to taxes. And I have some people that are looking that they wanna shield their taxes for the year and they're like, We need to go out and buy something. Okay, what do you wanna buy? And this is the conversa I'm having. The same conversation you're having with your people is, Yeah, what do you wanna buy?
And they're like I don't know. And I said you've gonna have to figure something out because I can't just go buy something without having that knowledge. And I said, I need to have the background as the. So we have to stick to things that I know. And the first thing that they wanna do, and this is I know we're digressing, is Airbnbs, and I'm like, the market is flooded right now with Airbnbs for sale because I think it was 47% of Airbnbs in the last three years, or two and a half years.
Have either come to market or will come to market because they bought at the top of the market and the price of the home and they can't keep it rented because now with all this craziness going on in the economy, they, I'm like why don't you guys just rent them? That's what I don't get. It's like you have another ability to do something and they don't do it.
[00:30:02] Stacey: Digs. And I would, I would say, and I know we're digressing, but I would say rent it in a you're gonna know the term better than I do. , but rent to own c corporate rental or rent to own, But I was
[00:30:13] Ryan: thinking corporate rental. Yeah. But is corporate. For a corporate travel it's still lagging, because of everything going on.
[00:30:20] Stacey: I'm actually thinking of so when I moved to Minnesota , I got moved up here by a corporation, right? , and they had a long term rental in a few houses. and so they put executives that they were moving into these long term rental houses while I found my own house. Yeah, I see.
And ended up building a house, so I stayed in that rental until my house was ready. So it wasn't it was more almost like four month.
[00:30:51] Ryan: No, I get that. Oh yeah, I did that when I moved around for my other business for the other corporations I worked for. They, ty typically put me up for six to 12 months because I was moving so frequently and took care of me.
So yes, totally get that. So
[00:31:03] Stacey: definitely that's a definite for an Airbnb. But yeah, it's the.
[00:31:09] Ryan: Is, sorry. The concept is just that is there when you wa I watch the market in certain places, especially where I'm at here in Phoenix. There's a ton of them hitting the market and. I reached out to a couple of them cuz they're selling them on their own.
They're not using a realtor, which to me is just mind blowing because it doesn't matter how good you are, let a realtor take it and work on the fees. They're the professional. My God. I was just gonna
[00:31:34] Stacey: say, let the expert do what the expert does because Exactly your time. Is worth more money than taking extra time to try and become an expert in something you know
[00:31:44] Ryan: nothing about.
Exactly. And I had to learn that the hard way in my first runs too. So I get that. But then when I reach out to the owner tells me, and this is a quick story in this, we can digress and go into franchises with it, is he thought Airbnb would be similar to a franchise. And I'm like, Okay, where are you going with this?
And he, cuz. I thought he owned a franchise in the past or was part of one or whatever, but he basically thought, since Airbnb was calling people out to, they were doing some type of incentives in 2019, 2020, especially when the pandemic happened, they were subsidizing, helping out with marketing, blah, blah, blah for, revenue stream type of thing.
Kind of get where he is going with it. But then they stopped once their numbers started hitting and people wanted to travel and so forth and. He said he was renting. So out of 30 days in a month, he was renting at the peak, like 24 or 25 days, and now he's down to 10 or 12. And I said, Can I just ask a real dumb question?
Why don't you just rent it? And he goes, I don't want to ha, I don't want the hassle. And I'm like whoa. Wait a minute. Airbnb, you have to hassle, you've gotta have a cleaning crew, you've gotta have an ambassador or somebody that manages the guest experience who is doing. He said he was, and I'm you can pay an ambassador.
There's plenty of them through the air website that take 5% of the revenue, so give up five, mark up your prices a little bit to cover that, and it's less work you have to do. He's Really? Yeah, really . But anyhow, the, that is, but that's
[00:33:17] Stacey: a perfect example of somebody becoming an entrepreneur and not knowing what they don't know.
[00:33:24] Ryan: Correct. Yeah. Very true. Just understanding the concept and he is in a market that's pretty close to me. A neighborhood and rents are dramatically higher, but they're coming down because of the influx of the hedge funds out here. Bought a ton of single family residents, brand new ones, and then rented them out a top dollar.
They can't. Rent 'em now. So now they're giving away. I've heard Pathway Homes, which is a Blackstone company, they're renting either the first month or the second month is free. Something to that extent. They're giving you an option to buy in 12 months with. Portion of your rent going to the closing costs or down payment, whatever the case is.
They're being creative. But then the other thing is they're flooding the market with these things and they're taking hits. They bottom five, $600,000 there's one up the street that's for sale and it's been on the market for about seven months. They bought it for 550,000 and it's now down to 3 99 and it still hasn't sold.
Wow. I don't know. There's just so many things and we digress, but that's, I guess what the franchise in, in, in everything we're talking about is how does one stay successful in a franchise? I know military, they understand the SOP and so forth, but I'm opening it up to everybody to hear, cuz there could be people listening that want franchise and want to talk to you potentially that are not military.
How can they survive and how do they thrive in that type of, It's,
[00:34:47] Stacey: That's a really great question because that's something that we're talking about today cuz it's real. And what I'm suggesting is that you look at industries that I won't say are recession proof because there's no such thing but a recession resistant.
. So when I look in, in a friend of mine that is a franchise broker, she actually has a great line. The dirtier the job, the more money you can.
I like that. So there are some franchises that truly are recession resistant. Think about it. So I'm in Minnesota right now. In the winter, people have pipes burst in their home. . They're not gonna stand there and go, I can't afford a plumber. I'm just gonna let my the water turn to ice and turn my living room into a skating rink.
They're gonna get it fixed. They're going to call their insurance company, they're going to pay their deductible, and some plumber is going to get that. and some, what do you call the people who come in after a disaster and clean? Adjusters? No the people who literally do the work, I can't think of
[00:35:53] Ryan: the name.
Oh the cleanup crews. I know what you're talking about. Yeah. The cleanup companies.
[00:35:57] Stacey: Yeah. I can't think of the name, but there are franchises that do that. Yes. Wanna know this is like insane to me. This is absolutely insane. I'm sure you've heard of the pooper scooper franchises, you go the dog poop in people's backyard. And I'm like how much money could you make doing. So the franchise industry, every franchisor is required to file a document with the government called a franchise disclosure document. , And there's 23 items in that document, which we will go over if.
I talk with you so that you understand them. Of course, everyone can read them, but nobody does read 'em. It's like when you buy a house and you sit down and the mortgage documents at closing are this thick and they go, Just sign here. Just sign here, right? , That's what people tend to do when they buy a franchise too, so it's no.
We're gonna go through these so you understand what you're getting into. Anyway, item 19 is about how much money people who already own these franchises. There is a pooper scooper. That's not the one, but there is a pooper scooper franchise that the average income, and I'm not talking revenue, I'm talking income is six figures.
No, God, I swear to God. Wait,
[00:37:12] Ryan: is that insane? Okay, but can I ask that can't be recession proof. There's no Or recession resistant? It is
[00:37:20] Stacey: recession resistant in the right market because people who have lots of money are not being affected by the recession. That's correct. I wouldn't do it in a middle class community.
But if you're in my son lives by Santa Barbara, California. , that's a extensive area. Oh yes. Montecito even higher. If you or New York, some of the areas in New York City, they're not. If they can afford a house with a lawn in New York City, they're gonna pay somebody to pick up that poop.
They're not doing it the.
[00:37:52] Ryan: So I gotta ask a question. What does something like that cost on a monthly basis to, or how do they charge a monthly, weekly, every time they come?
[00:38:00] Stacey: The service, or how much do you pay to the franchisor?
[00:38:02] Ryan: Which is the the service, I'm just curious. Oh, I'm going down the rabbit hole.
Sorry. That's okay. .
[00:38:07] Stacey: But depending on the market, so here in the Twin Cities, you'd pay about $120 a month for somebody to come once a. And then they have packages like so again, in Minnesota because it snows most people. This is, we're going down a kind of icky path, but most people don pick up their dog poop in the winter.
It snows on top of it. You can't find it unless you get it right away, blah, blah, blah. So then spring comes, all the snow melts in your yard's full of. So pooper scooper, people have special packages. You hire them all year long. They may not be there when the snow's too deep, but they come clean that whole yard in the spring.
Or if you own, let's say you own a lawn service, a lawn mowing franchise, right? , there's a better word for it. Landscaping or something, right? Also by a pooper scooper. and then you can say to them, You don't want me running over your dog poop. So an add on service is we're gonna come pick up the poop before we mow the lawn, before we mulch the leaves.
[00:39:18] Ryan: Oh, that's smart. I've seen the dog pooper scooper, franchise out there. I just I just, I can't believe I that it, I know, but hey, God bless people, man. It's a business. You know what, If you wanna do it and it makes money, I'm, And you
[00:39:33] Stacey: don't, if you don't wanna do it, hire a bunch of high school boys.
[00:39:36] Ryan: Correct. And then, pay 'em a couple bucks and call it a day and move on. I get it. Yeah. But,
[00:39:41] Stacey: and, but I'll tell you another one. So I'm giving you the weird ones, but
[00:39:45] Ryan: those are the best
[00:39:45] Stacey: ones. There's a franchise that cleans up crime scenes. Yeah, I've seen that. I've never thought about when somebody's murdered in a house who has to clean the house.
Yeah. It's not something I would wanna do. No,
[00:40:02] Ryan: no, not at all. And then, oof. Yeah, That's not pretty at all. But it sounds like there's
[00:40:07] Stacey: a friend, but in real world. So the people in recession resistant are gonna be the ones who. The plumbers, the electricians, the, Help me out here, Ryan. The things at homes that need repair.
[00:40:19] Ryan: Electricians, plumbers, hvac. Yes. Any like handymen or handy women? Could be both. Yep. Anybody repair, car repair mechanics? Yes.
[00:40:30] Stacey: Yeah, all of those. And now I'm gonna go back to my military, right? So how many people, how many vets were trained in those areas? Many in the military a lot. And they can either own the franchise and be the one who provides the.
Or they can hire if they wanna own it, but they don't wanna be the one out doing it. Hire another vet that you worked with in the service and let them be the one that goes out and does it. And that's where the motivator assessment comes in when you, my clients work with me because some of 'em are like, Yes, I can do it.
I don't wanna do it. . That's. . If you wanna be the boss and you wanna just work on the operations side of it, it's great that HVAC or electric or whatever, because then when somebody calls in and says, I need help, if you're the one that's answering those customer service calls to set the appointments, you know exactly what they need.
You translate it to your guy that you've hired to go out and do it, and it's just more seamless that.
[00:41:38] Ryan: And makes life so much easier too, cuz you're now, you're educated and you start knowing the things that you think you knew. Now you know them because you've got experience with it.
[00:41:48] Stacey: It's, And you can start with another thing we talk about and a different way to think about it is very much what you and I were talking about before we went live.
Which is multiple income streams. Yes. So one way is, like I said, have a landscape and a pooper scooper. But another way, and another thing to think about if you wanna buy a franchise is do you wanna be a big fish in a small pond or a small fish in a big pond? So again, let's say you have $50,000 to invest.
You could buy five locations of a franchise that costs $10,000 each. You don't have to open 'em all at once. You just have to commit to them all at once, right? , and then you have multiple t. That's what I did with my School of Rock. I had one that I damn near went bankrupt on True story, but I had two others that were doing exceptionally well and that's what saved my butt, right?
So when you go in, the other thing is if you're a big fish in the small pond, you're gonna get a lot more help and support and attention. That's just human nature. So there are so many ways to go at.
[00:42:57] Ryan: There is, and we could go on and on and talk about this for sure. We've gone down lots rabbit hole.
Passionate about business . Yes. But that's great. We're coming to a hard stop, but I'd love to talk more. So a couple things I didn't ask this, but I will ask it now. Will, do you work with anybody outside of the military or veterans that were looking for? I,
[00:43:16] Stacey: I actually work. Yep. I work with anybody who's interested in buying a franchise and wants to know more.
That's great. I just focus my marketing on
[00:43:25] Ryan: Vets. Perfect. We have veterans listening too, so it's that's perfect. Best way for everyone to get ahold of you.
[00:43:33] Stacey: Couple things. My website is my name. Which are you gonna put in the notes? I will. Cause it's a mess.
and I'm on Instagram and it's there. It's Stacy Beck Marmolejo. and everywhere else, Facebook, YouTube, everything is my name Stacy Marmolejo. Except that was taken on Instagram. So that one's Stacy Beck Marjo .
[00:43:57] Ryan: That's beautiful. Beautiful. Stacy, thank you for your time today. It was a wonderful conversation.
I enjoyed it. I learned a lot about franchising cuz I had some misconceptions up here in my head. So I'm very honored that you came.
[00:44:12] Stacey: Thanks for allowing me to dispel some of those misconceptions. Everybody has '
[00:44:16] Ryan: em. Yes. And we all don't have to go after Chick-fil-A and McDonald's
[00:44:20] Stacey: franchises. No, not today.
Maybe tomorrow. Let's build up to it. Let's get that starter home first. You,
[00:44:26] Ryan: You blew my mind. $10,000 franchises or $50,000 franchises. I had no idea those were out there, so that's huge.
[00:44:33] Stacey: Yeah. Most of them fall in that 50,000.
[00:44:35] Ryan: That's big. I had no idea. All right. Thank you.
It's been a great conversation and we'll be chatting.
[00:44:42] Stacey: Thank you so much. I appreciate it. Have an amazing Halloween.
[00:44:46] Ryan: You too.