5 Serial Franchisors In The Money
NEW YORK ( MainStreet) -- There are some people who just can't get enough of franchising, so much so that not only do they own multiple franchises of the same brand, but they have created or invested in more than one name.
Franchises are attractive businesses to operate if you want to own your own business but don't want the hassle of starting something from scratch. From a franchisor's standpoint, it can be very profitable if the product or service answers a need in the marketplace and there is an operations model behind the product or service that is efficient and easily replicable.
Sales by franchises total more than one-third of the U.S. retail market, and more than 7 million people are employed by a franchise, according to the International Franchise Association.
"One of the reasons that many franchises have been so successful is that, in franchising, a business synergy is created. Franchisees brought together under one trademark can achieve things that as individual business people they could not do. Group advertising, buying power and the sharing of ideas are some examples of what can happen," the IFA says on its Web site.
We found five franchisors or franchisees who made a career out of either creating successful concepts or investing in multiple proven brand-name companies. Here's what they had to say about serial franchising.
1. Tony Lutfi, CEO of MarLu Investment Group
Tony Lutfi's experience centers in the restaurant industry, where he spent more than three decades in various positions in restaurants at the line and executive levels. Now as CEO of MarLu Investment Group , a multiconcept franchise ownership and management company, Lutfi gets to use that experience to invest in restaurant concepts with proven records of success.
MarLu owns roughly 90 franchises in California, Nevada, Texas and Arizona, including names such as Arby's, Little Caesars Pizza , Church's Chicken , Sizzler, Jack In The Box (JACK) and one non-restaurant concept -- Sears(SHLD) .
"I think most people are curious about how you manage several brands that often go in several directions," Lutfi says. "Certain brands do well for short periods of time and are very cyclical. So while some brands are doing well, other brands are not doing well. The strategy of diversity within
"You couldn't have 15 restaurants of the same brand in the same geographical area, it just doesn't make a lot of sense," Lutfi says. "With multibranding, there are opportunities to have brands in the same area without necessarily having to compete with one another. You can have pizza and chicken on the same block and not necessarily compete, but in a lot of ways help the businesses. In the food industry in particular you want to be where everybody else is ... you want to be on the high-traffic street rather than a secluded area."