Transcript of Franchise Expert: "I Got Laid Off, Bought ONE Franchise And Became Financially Free" | Ep. 448 with Gregory Mohr Founder of Franchise Maven

Going to the office, collecting that paycheck companies give you to help you forget your dreams.

At 16, Greg Moore worked at Taco Bell. Decades later, corporate laid him off, so he used his 401 to buy one single franchise, one territory, and never needed a paycheck again. Since then, 3,000 people have come to him for help. He turned away 2,700 of them.

Don't be like me and buy a job. That's basically what I did.

What's the number one reason that you see that these franchisees fail.

Not following the system or the processes. I had one lady who took over the Las Vegas Palace. She was the vice president in the gaming industry. She told them—

I learned that you achieved financial freedom, financial independence by owning one franchise. I would imagine most people think you need dozens. What is the truth about how much someone can make by owning a franchise?

Pretty much, Dan, the sky's the limit on that one. To some extent there, it's really a matter of how much time, how much effort you put into that franchise or hiring a manager to put in that effort and time for you. But you're still putting in time and effort. You can own one and you can— I did it with one in one territory. It's probably a little bit quicker to do with one franchise in multiple territories. But entirely possible.

When you're looking at what franchise to go with, how does somebody know where to put their money and time?

What you're going to be looking at there, Dan, and that's one of the things that we go over together when I work with my people, is really which is your background. So what do you bring to the table? What is your skill set? And what really— what skill set do you like to use on a daily basis that does not feel like you're working? So what you need to look at from that franchise is what skill set does that franchise require? This way you're utilizing what you like to do best, what makes it enjoyable for you. Also look at the culture on that. And, you know, you get together with the franchise development people and you talk with many franchisees along the way. So kind of get a good feel for what the culture is like for that franchise, making certain that you're comfortable with it. And then there's some other little things along the way too. Well, not maybe not so little things along the way. Really, can you afford it? And pretty much the franchise, they're going to tell you if you can't afford it, then they're not going to talk to you.

But you want to make certain that you have the money to invest. They usually have a minimum net worth on there. So you make sure your net worth is there, make sure you have the money to, to get that franchise up and running. So you need to look at that runway on that. And talking to many different franchises, you'll get a good franchisees, you'll get a good feel for that. It's really, though, challenging when you first start out yourself. Same with I did when I first started looking at franchises to figure out which franchise is right for you because there's 4,000 franchises out there. So it's, uh, it can be a challenge going through there. I did that when I first started. I had about 20 different franchise development people calling me, telling me their thing was the greatest thing since sliced bread, and I'm like, which one do I choose? So, uh, you can do it yourself. You just have to do a lot of research and, and keep checking them, see who's got the territory available. Uh, as a franchise consultant working with, you know, 400 different franchises, I can really help Narrow that field down.

But if you're a do-it-yourselfer and you want to do it yourself, then those are the things to look for. What skill set are they looking for? What are you doing on a daily basis? You're out there knocking on doors, or is franchise happy people coming to you? And when they need it, many, many different things to look at. But really, your skill set and what you like using on a regular basis is really what's going to make a difference on that because It won't feel like work then. It'll just— it'll be fine.

So do you suggest that people look at doing a territory where they're committing to a group or owning that territory where they get people to then franchise within, or should they start at just one location?

Dan, it depends on really what your goal is. So one of the things that I ask people is, where do you want to be 3, 5, 10 years from now? If you're looking to just immediately replace an income, And you're really not looking to grow an empire, then look at one territory. Look at one territory and talk to the franchisees and find out in the franchise disclosure documents what can you expect income-wise from that one territory itself. Is that going to be enough to get you to where you want to be on there? With me, I just wanted one territory. I was fine. I saw what— how much they made. I said, that looked perfect. I can get to where I want to be, financial independence, with that one because I didn't need a whole lot. I lived out in the country, didn't have a whole lot of expenses. I didn't owe anybody anything, uh, and I used my 401 plan to, uh, get the franchise, so I wasn't going into debt. So that part was really simple for me. Now, for you, it may be different. So you need to look at if you're going to replace your income, and if you've got a, you know, high— mid to high 6-figure income, you're probably going to be looking at more than one territory for that, as far as an income from that one territory, and look to see if, okay, That's not going to do it, then I'm going to need to add 2 or 3 territories.

You say something that I think is true. Don't be a founder, buy a proven system. And the truth that I see is most people will fail as a founder. And it may not even be them. It's like, what, 90% fail within the first 5 years? Where do you see the biggest benefit of getting a franchise? Knowing that majority of the time you're going to fail?

Well, Dan, pretty much every single one of those franchises that are out there today are founders. They founded themselves. So what you're not seeing when you're looking and getting into a franchise system is you're looking at the ones that succeeded. You're not looking at the ones that failed because they're no longer there. So now you've got the ones that have said, okay, this is what they've gone through, all the challenges to get to where they want to be. They've made the mistakes, they figured out what doesn't work, and more importantly, they figure out what has worked. For them. So now they've got that system and process in place for you, and you just step right into it and you utilize all the information that franchise has already gathered to who to talk to as far as how to get your clients, where to get your employees if you need them, where to find a manager, how to— if you're a service industry, how to turn that dial up so that you are now booked out 8 weeks in advance. And if you get too much, work and dial that back, that lead source back. That's what you're looking for with a good franchise system is really you just step in, follow their processes and procedures, and then you get to where you want to be, probably 2 to 3 years at least quicker than if you were to go out there and try and do the exact same thing yourself, making all those mistakes and figuring out what to do and what not to do.

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HVAC, your heating and air conditioning system, plumbing, electrical restoration services, senior care, tutoring is a good one. The medical field is a really good one right now. It requires a little bit more of an investment, brick-and-mortar type things. But a lot of these, what we're looking at are essential services. These are things that people need every day. So you don't always think about them necessarily as a franchise. And pretty much anything that has to do around the home or conversely the office or building as well. You know, lawn maintenance, pest control, remodeling, handyman work. A lot of those people don't realize how big some of those systems are. They're as big as some of the restaurant systems. But if you don't need the services or never use the services, you generally don't know about them.

You've helped hundreds of people. become a franchisee, what's the number one reason that you see that these franchisees fail?

Not following the system or the processes on there. I had one lady who took over the Las Vegas Valley. She was the vice president in the gaming industry, and she took over the tutoring in the Las Vegas Valley. And she told them, you know, you guys, you know, girls haven't hidden up the the hotels and motels in the area. She said, I think that'd be a great, great way to start. I mean, you know, it's an underutilized resource. They said, well, that's not in our business model. We've never tried that before. We've never done anything like that before. You're welcome to give it a shot, but we don't have anything to go on to, to how to get it done. So she tried. It did not work out for her. So her first 6 months got off to kind of a rocky start. She then shifted back to their model, what was worked, What was a proven system and took off from then on. So, you can be creative in franchising, but you probably don't want to be creative too soon. You really want to follow that system and process and then get creative at a later point.

But that's where I see people failing, Dan, in direct answer to your question, is really not thinking that you can do— make improvements or do something better than the franchise has already done when they've already proven out this is the way to do it. This will get you where you want to be.

Is it common for people to think that they may know more than what the franchise system knows and they try to do it on their own, or do you find that most people stick to it?

Most people stick to it. I can determine pretty quick, Dan, uh, early on when people start, uh, when I take them through the franchise investigation process and when they start saying things like just like that, like, you know, he's doing some things or he should— she's doing some things that aren't quite right, you know, I think I could do them better. I just got to tell them, You know, if you're thinking that, then you really should not be getting into a franchise in the first place. You are somebody who should start your own business, create your own franchise, and do it that way. So yeah, I just, I tell those folks that franchising is not for you. Uh, time to move on.

I like that. I mean, save yourself headache, right? I imagine if you help people and they're successful, they obviously are going to recommend you. But if you help somebody and they're not successful, They might even blame that almost on you, even though it was their own fault.

That's very true. I try to be really upfront. You know, it's interesting you say, you know, Greg, you've helped hundreds of people, you know, get into a franchise system. Well, I've probably worked with, you know, so I would say it's up to about 300 people now that I helped get into a franchise system. I would say over 14 years, about 3,000 people came to me to look into a franchise. So, 2,700 people, I helped them realize franchising was not for them. The other end of the story.

Do you get people that come to you who are in the corporate life and they're daydreaming about the fact that they're making somebody else all this money and that they want to leave and they want to do their own thing? And if so, what advice do you give to them?

Absolutely. I get lots of people like that. So what we're looking at there is, again, where do you want to be 5, 3, 5, 10 years from now? What do you want to do on a daily basis? Look at the fact that it's going to take a little while to build this up. It's not going to be instant money right away, depending on the franchise you get into. If you get into a brick and mortar, you're looking at 6 to 9 months build out. If you're looking at a service industry, it's a little bit quicker. So you can get things built up right away. But I tell them to take a look at their finances, make certain that they have the runway to get that business up and going because it does take a little while to do that. Make certain if they're, you know, married with kids, make certain that, you know, the spouse is involved. and the spouse is going along with it and is backing the play as well. And then really take a hard look again at really what do you want your day to look like on a regular basis?

Are you open to, you know, getting up early in the morning or you want to sleep in? Do you want weekends off? Do you want 9 to 5 Monday through Friday? So all those things, those are a lot of the things that we go over and I advise them to really take a look at where your life Because it's not really where it is right now. Because your daily is not— that's why you're getting out of it. There's something wrong. There's something missing on that. Want to spend more time with your kids? Then we need to look at a franchise system where it's either manager-run. So you're doing a semi-absentee. So now you got plenty of time during the day. Some people actually really like, enjoy going to an office. They just, instead of going to an office for working for somebody else, they want to do it for themselves. So if that's what you enjoy, let's take a look at the franchises where you go to that office. on a daily basis. So many different things that we'll take a look at, and I'll really advise them really to take a look at your finances, make sure you got the runway for it and the money for it, and then what do you want your day to look like?

Do you find it's possible that somebody could stay at their job and buy into a franchise that has more absentee so they can continue to work, continue to create cash flow from their job?

It's not impossible, Dan. Probably about half my people do that. So for that advice, your ultimate goal is that you're not getting to where you want to be. You don't see yourself getting to where you want to be down the road. You want more time with your family. You want to do the things you want to do. Okay. It can be done. Plenty of semi-absentee franchises that are manager-run out there as well. However, keep in mind, to begin with, getting that franchise up, you're going to be spending a little more time building that business up. On there. So now you're not going to have quite as much time as you had before, but with the ultimate goal of eventually having that time or having that extra money flowing in. So many, many different franchises can be manager-run. Many cannot. Each franchise has a different rule on that. One of the things that I tell people when they're getting into a franchise and they want to do it semi-absentee and we're looking at those franchises is to talk with all the franchisees who started that out. has a semi-absentee-run business on there. The first thing to find out is just how semi-absentee was that in the first 6 months when you're building that up, and then talk to the ones that have been there for a while and see, is it still going well?

So are more people excited now to do franchising? Are there more people that want to open up a franchise or want to be a franchisee the last few years? And the reason why I ask is there's a ton of new businesses that have been opening. I think The most historic amount of LLCs that have been created the last year or two.

Franchising continues to grow. COVID really made it take off because what COVID did was it shook up everybody's schedule on there. They're used to doing this one thing, going to the office, collecting that paycheck. You know, it's a drug that companies give you to help you forget your dreams. So the business was disrupted. They said it's time for a change. time for something different. It continues to be strong. You see, you don't— if you look back in history, I'll make it quick. Sorry, Dan. But people used to work on the farms. Then we got the industrial age and people decided farms, they're not what we want to do. We want to get a job in an industry because you get the pension, you get the paycheck. Well, after a while, and these days now in the past few years, working for corporate is not what it has been. in the past for people. It's not quite what they have in mind, and they're going towards more towards independent, more towards doing things for themselves. They see a better path to financial independence by doing something for themselves and building up their own business.

I like to say I was forced into it because I've been laid off more than one time, and I realized that even if you have a job, and with AI and technology now, it almost seems like your job is even more temporary. And there really is no security anymore in a job. Do you feel that people will continue to be driven other places, whether it's creating a side hustle, getting into an absentee franchise?

It does not, Dan. And that's what brought me here to where I am today because I also got laid off. So yeah, I don't know if I would've been brave enough to walk away from my job. I'd like to think I would've been eventually to walk away from that job, but I got laid off. And I had worked for Taco Bell. That was my younger days when I was 16, and I worked for a master franchisor. So that got me involved in franchising. But I think people, Dan, direct answer to your question, they are seeing the writing on the wall that there's— they see layoffs all the time, always in the news. In the semiconductor industry that I was in, usually every couple of years we got— we had laid off people, getting laid off. And people see it every day and they're thinking, Just like you said, Dan, that there's no security like it used to be in the job. At any point in time, the manager could say, your manager could tell you bye-bye. And then once we get a certain age, then we kind of have that little worry there of age discrimination.

Once you hit 50, 55, how easy is it going to be to get another job if you get laid off at the same rate? pay rate that you were getting before. That was my, one of my concerns when I did that. And I had just another gentleman just the other day who's a little bit younger than I was when, when I started. And he just got laid off and he was thinking the same thing. So he's picking it up a couple territories and said he'll probably still go back and get a job. But he said, I don't want to go through that layoff thing again. I don't want to have to ever worry about it. So I got something on the side. I build that business up. No, I get a job, I'm good. I don't get a job, I'm good too.

So you were a restaurant manager, then you became a semiconductor engineer. How did you go from that jump and then go into franchising?

So restaurant was pretty easy. That's where I started out. I started out at Taco Bell, worked for a master franchisor. She owned about 50 Taco Bells. Uh, moved up in the Taco Bell world there, went on to manage a, what's called Alliance Restaurant, kind of like an upscale Denny's in Northern California. Did that for 15 years. That was a lot of work. A lot of fun when you're younger, but not so much fun when you get older. So, got kind of bored with that. Went back to school, got a degree in electrical engineering and physics. And why did that? Because I was always good at math. Math was good. So, it was either doctor, lawyer, or engineer because they paid the most. Or working in the forest industry somewhere because I like trees, but they didn't pay too good. So, I said, can't be a doctor. I hate blood. I can't be a lawyer. I don't write very well. So I'm good at math, engineering it is. So I went into that. While I was an engineer though, towards the latter part, but also got a bachelor's degree in the, sorry, a master's degree in business.

A friend of mine, another engineer myself, we bought dry cleaners, privately owned. We bought storage units. And then I had a couple rental properties as well. I was working all those on the side while I was doing my job. So I always knew that I wanted something a little bit different. And I was always each, each movement, I was trying to move up, trying to improve my income and trying to look at a point in time when I didn't have to work quite as much doing it. So that's what got me into it. And then I got laid off, sold my rental properties. The dry cleaners was privately owned. It was a challenge. My buddy that I got in there with, he really enjoyed it, learning about it. But, you know, we didn't know anything about it, so we all had to figure out Both of us had to figure out what do we do next? What do we do with the when the equipment breaks, or what do we dump the stuff, or how do we get clients? He got into that. I was like after where I got laid off, he got laid off too.

I said, "I'm selling you all my stuff." I liked that franchise thing when I was doing Taco Bell, so I'm going to go back and do that that franchise thing. And that's when I started looking for a franchise. I eventually found a franchise consultant to work with after those twenty different franchise people were calling me up and telling me he did real good. I like that. So after I built up my franchise for a while, and I was going out and talking to business. business owners over in the Austin, Texas area because that's where I worked in the semiconductor industry over at Motorola in Austin, Texas. But I had a lot of driving around to do. And then I thought, you know, that franchise consultant thing was pretty cool because he got to sit at home all day and talk with people. So that's a really good use of your time. So after I built up my business, got my financial independence, I said, I got to help other people do this. So I went into, called him back and said, hey, Teach me what you do. I want to do that. Work from home all day, set my own schedule.

When you get comfortable in a corporate job, at least for me too, when you're moving up, you just get comfortable and you're never really prepared, I don't think, for what could possibly happen. And I feel like the economy, like so many things are up and down. It's great to have something there that you can fall back on just in case, if not becoming your own thing. When you go into franchising though, were you thinking about building something up to create money long-term?

Create money long-term, Dan. That's the only thing I thought of. So create money long-term, no employees, do it all myself. That was my real mindset after being in the restaurant industry and having like 50 employees, system managers, kitchen managers, and all that. I said, I don't want to deal with that anymore. So I still have people that help me, And for you entrepreneurs out there, you can not have employees and still have contractors that help you. So with any business, you go out and figure out what you like to do and what you don't like to do. So you do everything at first and then the things that you don't like to do, you get other people to do it. So I just thought about money creation. I just wanted to become independent, set my own schedule and not have employees. That was my mindset.

So can you build up a franchise to then sell it later?

That was your other question. Yes, indeed. So what I tell every single one of my people is don't be like me and buy a job. That's basically what I did. I still sold it, sold it back to the franchisor. But any business with a franchise system, you can sell. What you wanna do is when you're going into a franchise system, again, this is what I tell all my folks, do not treat it like a job. If you treat it like a job, it will be a job. You treat it like an asset. It is an asset that you want to sell. Or just have somebody else, you know, run it for you while you go do something else. You treat it like an asset. You do want to get that business to where it does not revolve around you. You can take a vacation whenever you want. You can go wherever you want. You can take off for 30 days. That business still operates. That is a sellable asset. And that's what people look for. Franchises, resales, they're easy to sell. Most of the time when you sell a franchise system, what you'll do is you'll tell the franchisor that you're selling and the franchisor is gonna tell the other franchisees in the area.

So you got an asset that you can just transfer over to somebody real quick. One other franchisee will come in, buy it from you, pick that up. If there's no other franchisees, then they put it out on the open market. People ask me about franchise resales all the time and generally don't have too many good ones because franchisees pick them up right away on that. But yes, great sellable business, but it's got to be an asset where it does not revolve around you.

If you had to start from scratch tomorrow, what franchise would you buy into?

Doggy daycare or a chocolate shop, just because that's what I enjoy.

Chocolate shop or doggy daycare.

Yeah.

Why those 2?

So I love dogs. We got 5 dogs at our place right now. So I love working with animals. So that's, again, I'm thinking about what skillset do I like to use? What do I enjoy doing on a regular basis? Love working with dogs. Absolutely fun. It would never be work. I'd never work a day in my life if I work, if I, you know, ran the doggy daycare, that would be great. It's also a big business because nowadays people treat their dogs as family. They're their children. On a huge business, will continue to be a huge business on that chocolate shop. I'd probably lose money because I would probably be my best customer on that. I'm not too sure a chocolate shop would be. There's some that are profitable, but you gotta put 'em in a really good location. But doggy daycare, That would, uh, if I was to do it all over again and build something up, uh, that would be it because I just love working with dogs. One of the things I like.

I was just reading that it's like over a $100 billion industry is health and wellness for dogs, for pets. And I thought that was very interesting. What type of profit margins are you seeing across the board?

If you're looking at the service industry, there's various ones. It's interesting. There's some Where if you do like vinyl, leather, plastic repair, you could look at it, you know, 70 to 80% margins on that, on that type of business. Really huge one for those. In general though, we're probably looking at around 25% for the service industry, give or take, when it's all said and done. Probably a little bit less for your brick and mortar because you've got a little bit more overhead with those. But there's quite a few businesses that have a It can get up to like 30% profit margins in the, uh, in the service industry. And the service industry, again, is where your clients don't necessarily know you exist. And then you're looking at the things that you do around the homes, the DIY things that you do anywhere from outside to HVAC, plumbing, electrical. Those are some really, really solid businesses with really good numbers.

What are 3 traits that you think people have that make them the best franchisee?

Uh, gotta be a self-starter. A franchise is not gonna call you up in the morning and say, Greg, it's time to go do your franchise. So you gotta be a self-starter. You got, you do have to have a little bit of risk tolerance on that because it is a business. While your chances of success are a lot greater with the franchise, it's still some risk involved in there. And you've got to be able to follow a system and follow a process because that's what it's all about. You don't, you're not, you're not being a founder. You're not founding that yourself. Somebody else already did that for you. They've already got the system. That's why you get into the franchise. That's what you're buying into. That's what the franchise fee is for and the royalties are for. You got to be able to follow that system.

Why did you write a book, Real Freedom? Because writing a book is a lot of work. I just wrote a book, came out in January. I don't even know if I would ever write a book again.

Then it was a little bit more work than I anticipated it to be. I had so many people asking me the same questions over and over again. I thought I may as well just write a book about it. All these people are asking me these. So yeah, if I put 300 people into franchises, 2,700 of them, I did help them decide it wasn't right for them. So I thought, why don't I just give them a book and they can read the book first and decide on that? So I wrote the book, step-by-step process of how to evaluate, investigate franchises, Real-world examples of the people that I work with. So I wanted people to have something like that, something like that in their hands that they could hold, that they could read, and they could say, franchising is not for me, or franchising is for me. And this guy is crazy. I'm not going to talk to him. Or this guy knows what he's talking about and I'm going to give him a call. So it kind of filters the people out too. The ones that think I'm nuts, they don't ever call me, but the ones that resonate with me, How they could do it.

So I put it, that book into their hands so that they could get a feel for franchising, uh, before they took the next step.

What are 2 or 3 of the most important questions somebody can ask themselves right now to even determine if they should even be talking to you?

Do I have the time to open a franchise? Do I have the money to open a franchise? And do I have the tolerance to open up a business?

I love that, Greg. By the way, I know we were talking earlier. I used to work in a similar field. I got to say, being a consultant is a really— it's a lot of work in itself. I don't think people understand. I think it's almost more work than starting the business or being in the business. But I learned so much just about business in general. It was the best job I ever had. It was also The worst job I ever had, but I, I'm thankful for what I got to learn, what I got to see. Like you said, when you start a business, you don't know anything about anything about anything most of the time. At least with the franchise, you have so many systems and processes and like you, they've done all the failure. So I think this gives them an incredible way to become a founder and in a way become a business owner, entrepreneur. Without having to also go through so many things and so many failure rates. But if people want to get your book, by the way, Greg, how can they find it?

You can find it on Amazon, probably the quickest thing to do on there. That way you have to pay for it and I get some money for that. That's always a good thing for me. But if you want a free PDF version, you can go to my website, franchisemaven.com, franchise, M-A-V as in Victor, E-N.com, and just go to the book resources on there and you can just download a PDF version if you want.

Greg Moore, founder, franchise maven. Love the story. Thank you so much for what you do to impact other entrepreneurs, and thanks for joining us today.

Dan, it's been an honor. I appreciate you having me.