From a Fix-it Guy to a Franchisee Now Working on His First $1 Million
Franchise Players is Entrepreneur's Q&A interview column that puts the spotlight on franchisees. If you're a franchisee with advice and tips to share, email email@example.com.
Kory Arntson's Handyman Matters franchise, opened just five years ago in Portland, Oregon, recently won his third Angie's List Super Service Award. Angie's List Founder Angie Hicks says that only about 5 percent of companies in that metro area perform well enough to win the award. "It's a really high standard," Hicks says. One reason for Arntson's success in the home improvement sector? Great customer service. Says the franchisee himself: "We are creating happy customers by easily differentiating ourselves from our competition."
Name: Kory Arntson
Franchise owned: Handyman Matters of Portland
How long have you owned a franchise? Five years
Following the economic downturn in 2009, I made a decision to stop putting off my goal of owning my own company. A franchise provided me the opportunity to hit the ground running and be profitable very early in my ownership cycle. The question was which industry to focus on. Given my background, I decided to marry my love of real estate with my passion to improvement the community I live in.
What were you doing before you became a franchise owner?
I was a managing director for one of the largest real estate private equity firms in the western United States. Specifically, I raised investment capital from high net worth individuals who desired the passive income potential possible with Reg. D private real estate investment partnerships.
Why did you choose this particular franchise?
I love working with my hands and always have a project going. Whether it was working on my rental properties, my own house or helping my friends, I was always investing in a fixer-upper or building something. I decided to combine the two by owning and operating my own construction company.
How much would you estimate you spent before you were officially open for business?
My initial investment was $110,000, with startup costs of $71,212. The biggest costs were the franchise and territory fee, $42,500; startup advertising, $4,000; and a workmans comp reserve, $5,000.
Where did you get most of your advice/do most of your research?
Existing franchisees, family and franchisor.
What were the most unexpected challenges of opening your franchise?
Human resources! With no track record of business success or guarantee of future projects to work on, it was challenging to convince prospective employees that this was a great place to work. All I could offer was a wage and the promise that I would treat them fairly. I was subsequently introduced to the “revolving door” of employees who were always looking for “greener pastures.”
What advice do you have for individuals who want to own their own franchise?
Do it! Don’t procrastinate. Thoroughly research the franchisor and dig in deep on history, financial stability, growth potential and industry sector. Always run your numbers knowing that you will be paying royalties before you pay yourself. In your planning process, schedule a vacation to get away from the day-to-day operations, giving yourself time to reflect.
What’s next for you and your business?
Two things: investing in small real estate projects that my in-house crew can improve for value creation and reaching the $1 million revenue mark.