Alternative-lifestyle franchises are booming
From back rubs to health food, alternative-lifestyle franchises are booming
Who knew that you could franchise the concept of getting business owners together to talk shop? Minneapolis entrepreneur Norm Stoehr thought so; he put a New Age spin on the idea and turned it into a national franchise chain. Stoehr’s company, Inner Circle International Ltd., sponsors encounter groups for entrepreneurs from noncompeting businesses. Meetings are a blend of camaraderie and tough love: members vent about the stumbling blocks that are impeding the realization of their business and personal dreams, and the group responds with pointed, no-holds-barred feedback. “We hit them on the head once a month,” Stoehr says; “then they create an action plan to accomplish what they really want in their lives.”
And at Zuka Juice, the corporate culture is based on Zuka ‘tribal traditions,’ among which are teamwork, a positive work environment, and respect for others, regardless of rank. The 84-store juice-bar chain, based in Salt Lake City, even has its executives refer to franchisees, staff, and customers alike as ‘the Zuka tribe.’ Flaky? You might think so until you consider that the three-year-old company’s revenue projection for 1998 is $35 million.
Since alternative spirituality and health concepts are some of the hottest tickets in franchising today, Zuka and Inner Circle are both sitting pretty. The Washington, D.C.based International Franchise Association (IFA) reports a doubling of membership over the past 18 months in what spokesperson Kara LaGrassa calls ‘New Age’ franchise categories: encounter groups, health food, back rubs, and the like.
There’s a huge market for these so-called feel-goods, says BrainReserve, a New Yorkbased marketing-consultancy ̃rm. And we’re talking choice demographics here. New Age consumers live everywhere and embrace all age groups; they tend to be well educated and have plenty of disposable income.
One caveat: Don’t be too distracted by the granola-chomping aura that many New Age franchises project. New Age concepts are hot because of market demand, not because traditional business rules don1t apply. So whether you start a chain yourself or buy a franchise from an established company, you need to balance customers1 desire for an alternative atmosphere with their demand for high-quality service and products.
Following are four questions you must ask in order to choose and operate a prõtable New Age franchise.
Will it travel?
No matter how many trees died to enable the tree-hugging psychobabble in their marketing literature, New Age franchise chains aren1t, at bottom, very different from Jiffy Lube or McDonald1s. Buying in will cost you thousands in franchise fees and royalties. So, before plunking down your life1s savings, make sure the concept will work in your region, advises Andrew Sherman, a partner at the Washington, D.C., law ̃rm Katten Muchin & Zavis and the author of Franchising and Licensing: Two Ways to Build Your Business (Amacom, 1998).
Don’t just accept the cheery assurances of company sales reps (“Of course you can make money ̃xing surfboards in South Dakota!”). Instead, ask for hard sales data from a variety of locations, including your own area and others that are demographically comparable. In other words, don1t try to compare apples and oranges. If you’re thinking about buying a health-food franchise in a middle-income midwestern suburb, then check sales ̃gures for other middle-income suburbs in the Midwest.