Back from the Brink
A generous financing program helped an entrepreneur revive a fading franchise.
By Tracy Stapp
Bill Ellis' 13 years of experience in equity sales gave him a leg up when it came to researching franchises. He chose Volvo Rents, a construction-equipment rental franchise, because of its unique financing program.
While many franchisors help franchisees obtain third-party financing, those that actually offer financing themselves are much rarer. Volvo Rents, through its affiliate Volvo Financial Services, breaks the mold, offering financing of up to $5 million per location for equipment, leasehold improvements and other startup expenses. As Nick Mavrick, vice president of marketing, says, "It's our capital at risk alongside that of the franchise owners." To date, Volvo Rents has invested more than $450 million in its franchisees.
With the franchisor's help, Ellis bought a struggling Volvo Rents store in Langhorne, Pennsylvania, in 2005. But he knew capital wasn't all he needed to make the business succeed this time around. He replaced the former owner's equipment and cut ties with their existing customers in order to focus solely on commercial construction clients. "It was a little nerve-wracking," he admits, "but it was the right thing to do." He rewards the top customers he's attracted since with trips to sporting events--including the Super Bowl.
Ellis, 43, bought another existing location in Somerville, New Jersey, in January 2007. He's grown his total staff from eight to 35, hiring from within the industry so he can focus on what he knows best: the financial side of the business. With sales of $13 million projected this year, he's already considering acquiring more stores--and building some from the ground up.
Working with chocolate and being your own boss. what could be better?
By Emily Weisburg
Imagine making the transition from federal government and insurance work to owning a chocolate business. When Lori and Mark Gray bought a Rocky Mountain Chocolate Factory, they felt as though they'd found their golden ticket--in more ways than one. "We saw how the [wealthy] lived and wanted to know how we could [live that way], too," says Mark, 47, who has worked for the Bureau of Reclamation for 25 years and now also works part time as a chocolate cook. Lori, 44, was tired of working for someone else, so she quit her job in insurance to become the full-time manager of their Farmington, New Mexico, Rocky Mountain Chocolate Factory store.
When the Grays were shopping around for a franchise, they were impressed by how the Rocky Mountain Chocolate Factory corporate office embraced them. It took about eight months for the Grays to go from concept to grand opening in August 2007. Their store is located in a bustling shopping mall near a large American Indian reservation, so it gets heavy foot traffic and requires little local advertising. Once in a while, they advertise in the newspaper or give chocolates to radio station DJs to eat on-air or give away as prizes.
The Grays employ nine part-time employees--their first employee was their 16-year-old daughter, Stacy Brandt, who is now a manager. Since opening their chocolate store, they've averaged sales of $55,000 a month, with revenue swells during holiday seasons. They know their success is a result of their constant involvement, and although the work is sometimes hard and the days are often long, Lori says she finds much more satisfaction in working hard for herself than for someone else. Her customers seem satisfied, too. As Lori says, "What better way to make people happy than to offer them chocolate?"
Actually, it is easy being green.
By Tracy Stapp