As we wrap up the first full year with our Tier 2, mobile-only model of franchise ownership in place, the results are clear: The idea has proven an overwhelming success. Across the United States, existing owners have expanded their reach and many new franchisees have entered the field under the new ownership model.
“We anticipated this would be a successful strategy when we put it in place, but it’s exceeded our expectations,” said Glenn Duncan, chief executive officer. “It’s opened up franchise ownership to a much broader base and we’ve seen a significant response.”
Since the introduction of the option in summer of 2016, there have been 13 such locations starting up around the country. The last quarter of 2017 saw major activity in Tier 2 openings: From September 2017 to the year’s end, Tier 2 locations launched in Columbia, SC; Madison, WI; Corona, CA; and Seattle.
Florida has seen the most Tier 2 openings of any state since the program began, which include locations in Daytona, Fort Lauderdale, Palm Beach, Fort Myers/Naples, Lakeland/Polk County and Gainesville/Ocala. Tier 2 franchises have also opened in Austin, TX; Grand Rapids, MI; and Fort Collins, CO.
“The Tier 2 option is a great way for entrepreneurs to enter the market and work toward a full Tier 1,” Duncan said. “What’s interesting is that we’ve actually had people come to us interested in the Tier 2 model who have then decided to start a full Tier 1 instead. It’s been an excellent recruiting tool for PIRTEK ownership.”
Duncan added that the model provides franchisees with two distinct advantages. “The Tier 2 locations hit profitably in a shorter period of time, because they have less overhead compared to a Tier 1,” he said. “They’re more sales-focused, too. They don’t have a home base, so they’re out in the field a lot. In fact, some current Tier 2 locations are talking about expanding into a Tier 1 earlier than three years because of customer demand.”
The Tier 2 model has received positive reviews from owners, too. “It makes franchise ownership more accessible to a larger group,” said Dan Ferretti, owner of PIRTEK Space Coast in Rockledge, FL, (a Tier 1) who recently opened a Tier 2 in Daytona. “It also enables existing owners to own multiple franchises – we wanted to take advantage of that benefit.”
Ferretti is one among several Tier 2 owners who already owned or worked for an existing PIRTEK location before opening a mobile-only location. Others, such as Jason Barrs at Columbia, are new to PIRTEK. “After I checked out the company and visited corporate headquarters, I was excited,” Barrs said. “When I left, I was thrilled and I couldn’t wait to get started.”