Mechanics, dog groomers and windshield repair companies long ago took their services from the storefront to the streets. Now, the mobile franchises model is expanding to accommodate more time-starved consumers craving convenience.
In the St. Louis market, mobile franchises are delivering everything from bubbles to bike parts to buff biceps, although those will require some work on the customer’s part as well. Experts expect those offerings to expand as e-commerce continues to cater to consumers’ appetites for goods and services delivered to their door.
“Thank you Amazon, because Amazon has created this whole new business model and this whole new mindset,” said Joel Libava, known by the trademarked name The Franchise King. “So I think Amazon is partly responsible for creating this whole delivery craze and mobile business craze,” Libava said.
For franchisees, the mobile model typically requires a lower investment than brick-and-mortar businesses while offering some of the same advantages of traditional franchises, including a proven business model and a corporate office that likely covers some marketing and advertising costs. Mobile franchises can require an investment of $100,000 or less and can be operated from almost anywhere, including the business owner’s home or an inexpensive space well away from high-traffic areas that might draw casual customers.
But, as with any startup, success probably won’t come easy, cautions entrepreneur and small business expert Susan Solovic.
“I think the biggest thing about mobile franchising is that you’re probably going to need to be an owner/operator,” said Solovic, an author whose books include “It's Your Biz: The Complete Guide to Becoming Your Own Boss.”
“You’re actually going to have to do the work yourself, so it needs to be something you really, truly enjoy," she said.
Despite the investment in time, money and sweat equity, an increasing number of Americans are entering the franchise field. The number of U.S. franchises is projected to increase to 744,437, up 1.6 percent from 2016, with franchise employment expanding by 3.3 percent to nearly 7.9 million nationwide, according to a report from the International Franchise Association.
While the report doesn’t break out mobile franchises, Libava said the mobile model is growing, with some of that growth driven by brick-and-mortar franchises expanding delivery offerings and increasing the number of services they provide outside physical locations.
“People want convenience,” he said. “They want it now. They want it delivered. They don’t want to necessarily leave their house. So I think the trend is going to continue.”
Among the St. Louis entrepreneurs taking advantage of that trend is Francesca DeRanzo, who in February 2016 launched the area’s first velofix, a franchise of the mobile bike business based in Vancouver, British Columbia. DeRanzo had spent more than a decade in the cycling industry and considered buying an existing bike shop or starting her own before deciding on a deal with velofix.
“The brick and mortar is missing out on the internet customer because they’re never coming into the shop,” she said. “You’re probably not going to see them until they need something, which could be immediately but could be a year or two down the road. And that’s why brick and mortar is really suffering.”
But there are some disadvantages to working out of a Mercedes-Benz Sprinter van. Customers can’t drop by for a quick tire fix or to pick up accessories, and velofix doesn’t have as much name recognition in the Midwest. So DeRanzo spent a lot of time over the last year connecting with corporate customers, hosting classes, servicing bikes at races and rides, and appearing at events including the St. Louis Earth Day Festival.
“The possibilities are really endless,” she said. “Anything cycling-related I can really offer, whether it’s education, or ride support or anything in between.”
Velofix had nearly 100 franchises in the U.S. and Canada as of April 2017, driving annual revenue growth of roughly 320 percent over the previous year, according to the corporate website. Locally, business has been increasing steadily for DeRanzo, although she hasn’t experienced the same exponential growth seen by some velofix operators who’ve been able to support a second van after only a year or so.
“I don’t have that kind of crazy success story, but I do think in another year or two, a second van would be possible,” she said.
Katie Mackenzie, who owns the St. Louis area’s first GYMGUYZ franchise with her husband Tony, also hopes to add vehicles and expand the territory covered by their traveling personal training service, which brings equipment and a certified personal trainer to clients’ homes, offices or anywhere else they want to work out.
The Mackenzies are both certified trainers and Katie has logged more than a decade in the fitness industry. Still, after having two kids, the couple found it more difficult to make exercise a personal priority. They know plenty of other busy people face the same struggle, which is what made GYMGUYZ, based in Plainview, N.Y., an attractive business opportunity.
“For us, I think it filled a niche that we saw was needed in our own lives,” she said.
Katie devotes full-time hours to operating GYMGUYZ while Tony works as director of digital marketing for a casino company and handles advertising and marketing for the franchise on the side. They also employ four additional trainers part time, booking an average of 50 sessions per week.
“It was an opportunity for us to go into something we were really passionate about, but we could kind of cover both aspects – the fitness side and the marketing side,” she said. “With my background and my husband’s background, it was kind of a perfect fit.”
John Reider was already a veteran entrepreneur when he came across Tekno Bubbles. Fascinated by the glowing blacklight bubbles, he bought out the product’s inventory about a decade ago and began marketing bubbles by doing demos around the St. Louis area. Soon, observers were asking if he could bring his bubble-blowing gear to their parties and other events.
“When I got into this business, I was just going to sell bubbles. I had no intention of being a franchisor and definitely didn’t have anything on the radar as far as doing events,” he said. “So the business kind of found me.”
Thus, Bubble Bus was born. Business built slowly at first, but Reider said he was soon experiencing year-over-year growth of 30 to 50 percent, prompting him to expand his fleet. Today, he operates five company-owned buses and advertises on portals including Franchise Gator to enlist new franchisees. Bubble Bus now has franchises in St. Charles and the New York City area, and Reider is fielding inquiries from potential operators elsewhere.
“We have something that’s unique, different and fun. The cool thing about a mobile business is that every time you’re driving to and from an event, you’re doing advertising. And once people see the bus in action, it more or less sells itself,” he said.
Reider still owns the electronics company IntelliPower Inc., but now devotes his working hours to Bubble Bus alongside around 15 seasonal employees and a small year-round staff that includes his wife Beth. Like his clients, Reider enjoys the business because it’s essentially a party on wheels.
“The beauty of the Bubble Bus is that we can go anywhere, so it gives our customers ultimate flexibility,” he said. “I’ve literally done bubbles in the middle of a corn field.”