Jan. 24 - Feb. 6, 2011 www.columbiabusinessreport.

com 9

Economic downturn draws people to franchises

By Bob Bouyea and he opened a FranchiseMart location on to do when you grow up,’” said Patrick the corporate office is really strong.”
Francis B. Allgood Woodruff Road in June 2009. Spadafora, who lost his job in the wire- John McGee was traveling three
bbouyea@scbiznews.com
Deal closing activity at FranchiseMart less phone industry. nights a week and was missing time
fallgood@scbiznews.com
over the past six months is three times Spadafora answered that question with his young family. When his neigh-

A
high unemployment rate is good what Harper experienced in the first 12 with BillboardConnections, an out-of- bor told him he wanted to sell his busi-
for franchising, said Scott Frith, months of his operation. He began rep- home media buying consultancy that ness, McGee asked him what business
vice president of marketing and resenting 85 franchises, and that list has purchases outdoor advertising space he owned: Lawn Doctor, the neighbor
franchise development for Lawn Doc- grown to 200. for clients while providing graphic art replied.
tor. Harper said about half of the entre- design, production and installation ser- Thirty days later McGee and his wife
As people are laid off, many look to preneurs that come to him seeking infor- vices. bought the Wilmington, N.C., business.
become their own boss, and franchises mation about franchises were laid off. “Business has been positive,” he said. Before they did, they looked at other
are attractive alternatives to starting a “Like a lot of people, you lose your job “Working out of my house I have very
business from scratch. This is especially and you ask yourself, ‘What do you want little overhead. The support you get from See FRANCHISES, Page 15 ➤
true in the low-investment franchise cat-
egory, Frith said.
Lawn Doctor, based in New Jersey, is
considered a low-investment franchise
with an investment of around $80,000,
with the corporation financing up to
$40,000 of the cost, he said.
“I honestly don’t think that people
wake up and say ‘I want to be in the lawn
care business,’” Frith said. But after look-
ing at other options and the cost of start-
ing up a business, people get interested.
According to the Kauffman Index of
Entrepreneurial Activity released in May,
business startups in 2009 reached their
highest level in 14 years, said Carl Sch-
ramm, president and CEO of the Kauff-
man Foundation.
“The franchises have done it,” said
Curtis Harper, president of Transworld
Business Advisors. “They’ve made all the
mistakes and you can get a faster startup
because you can learn from their mis-
takes.”
Transworld serves as a franchise con-
sultant, franchise development, busi-
ness brokerage and merger and acqui-
sition firm. Part of Harper’s portfolio,

Franchises such as Lawn Doctor are attractive

alternatives to starting a business from scratch.
Most provide a tried and true system of opera-
tions. (Photo/Courtesy of Lawn Doctor)
Jan. 24 - Feb. 6, 2011
MDVIP BY THE NUMBERS
25%
Annual growth rate in MDVIP enrollment
$1,500
Premium patients pay for MDVIP
430
Participating doctors in U.S.
them, but it was difficult for me. It was an
emotional decision that I had to make.”
Ultimately, Fairey made the switch
so he could provide better care to his
patients. This emphasis on wellness and
preventative medicine is a vital step in
improving the nation’s health care system
as a whole, he said.
“Like a lot of physicians, I had become
discouraged with the volume of care,” he
said.
Fairey, Burford and Steven Ross, an
MDVIP doctor in Florence, all said they
broke even in transferring from a tradi-
tional business model to MDVIP. The
annual fee accounts for about 80% of
doctors’ revenue, Murrison said, and
insurance covers the remaining 20%. Of
the $1,500 fee, physicians keep $1,000.
MDVIP physicians are independent
practitioners.
While the switch has been revenue neu-
tral at best, the three doctors said the pro-
FRANCHISES, continued from Page 9 ➤ “A lot were coming up short.”
franchise opportunities, but none of
them fit their family lifestyle. Plus, with
McGee’s background in agribusiness,
they kept coming back to Lawn Doctor.
“We were in the right place at the right
time,” McGee said. Since then they have
also bought a franchise in Myrtle Beach.
“Taking over a business that wasn’t a
startup had tremendous advantages,” he
said. “And we had to have an income.”
When McGee took over the com-
pany in 1989, there were 500 customers
with one to two technicians working the
trucks. He has built it into 1,800 custom-
ers and six to eight technicians and eight
trucks.
Jerry Pribanic’s career as a controller
and CFO spans 25 years and includes
Milliken & Co., Maytag Corp., The
Hoover Co. and Borg-Warner Inc. Prior
to his retirement, he was a partner in
the Greenville office of Tantum LLC, an
executive services firm.
He began to think about the legacy he
would leave his children, and when his
son lost his job, he decided to help him
start his own business. His son had a
strong sales and marketing background,
and his daughter-in-law was the catering
manager for Sticky Fingers in Jackson-
ville, Fla.
“I began looking at a couple of fran-
chises – doing my homework and build-
ing the financial models,” Pribanic said.
IN FOCUS: HEALTH CARE www.columbiabusinessreport.com 15
32
States with participating doctors
150,000
Approximate number of members
500,000
Goal for number of members
fessional satisfaction that comes along with
providing better care makes it worth it.
“It would be difficult for a physician to
make this decision based on economics
alone,” said Burford, who has been prac-
ticing medicine for 34 years.
MDVIP is one of several concierge
medical providers across the country, and
it is growing rapidly. Now 10 years old,
MDVIP is growing 25% annually. Right
now, MDVIP has more than 430 doc-
tors in 32 states, including 16 throughout
South Carolina, and nearly 150,000 mem-
bers. And the company is recruiting more
doctors here and elsewhere.
The goal is to have 500,000 members
across the county, Murrison said.
“We’re looking for as many exceptional
doctors as possible in South Carolina and
across the nation,” he said. cr
br
Reach Scott Miller at 864-235-5677, ext.
29.
Digital Solutions
He then met Harper, who introduced
him to Corporate Caters based in Miami.
The franchisor already operated a Jack-
sonville location and was seeking a fran-
chisee.
“I looked at the numbers and the
...Copiers & Service
capital investment, and the numbers
were like ‘ca-ching, ca-ching, ca-ching,’” From desktop printers to high-speed, high-volume
Pribanic said. production workhorses, we deliver the equipment,
According to the U.S. Chamber of network connections, software and
Commerce, a franchise has about a 90%
survival rate after 10 years. Only 20% of service you need.
independent businesses, however, make
it.
“With a franchise you get brand rec-
ognition,” Harper said. “Sometimes you
can leverage local and national purchas-
ing power.”
Frith said there are three Lawn Doc-
tor franchises in Columbia, and there are
three more available.
The benefits to the franchisee, Frith
said, are that the company analyses the
customer base and markets to those cus-
tomers and has field representatives that
work with the franchises to help them
build their business and follow the cor-
porate system.
“But one of the biggest things to being
successful is being passionate about what
you’re doing,” Frith said. cr
br
R. Joseph Pollock of Pollock Company has been selected for the inagural Konica Minolta Dealer Award
Reach Bob Bouyea 803-401-1094, ext. for Excellence, recognizing Pollock’s ongoing committment to the Augusta & Columbia communities.
200. Reach Francis Allgood at 864-235- 803.233.0900 • www.pollockcompany.com
5677, ext. 14.