Justin Strickland started in the industry in 2012 as a minimum wage hood technician working for Express Oil Change and Tire Engineers. After a year, he began working for Jiffy Lube as District Sales & Operations Manager. Through the floor level experience with customers, he felt like there was a better way of doing things. And so, he formed a business plan and proposed his idea to several venture capital firms and lenders in which he was denied funding numerous times. Justin's grandfather collateralized the family home to fund his grandson's vision with a $35,000 HELOC loan. From this, the company has grown to nearly 100 open units and 200+ more committed units to open. Lisa Palmer is the Director of Franchise Development for Strickland Brother’s. She has extensive background in sales and marketing, beginning her career with Express Scripts as a proposal writer, before moving to a sales coordinator position. In 2008, she opened her own business, PerforMax Fitness Professionals. She’s also a CycleBar franchisee, owning 2 studios in Charlotte, NC. Luck is where you’re willing to look. Justin might not have struck fossil fuel but his idea about the oil change business is GOLD! Ready to make your own “luck” through Franchising? Tune in to our Podcast to learn more about everything you WANT and NEED on franchising, investment, financing processes and options. This is Eye On Franchising, where we share our vision for your franchise future. https://www.facebook.com/lance.graulich https://ionfranchising.com/
Are you one of the people who believes financial freedom is born out of luck?
Like some crazy lottery, some people are just born in places where high-value commodities are in abundance and just sells on their own. We’re talking about those who just stumbled upon diamond caves, gold mines, and oil.
To most people, having to work minimum wage means they lost the lottery. But to some people, it’s exactly that kind of experience that makes them “lucky”. It’s down on the ground where people find so many opportunities!
That’s how Strickland Brother’s 10 Minute Oil Change, a one-stop-shop franchise for oil change and other professional automotive maintenance and services, was born! Hear the story straight from Justin Strickland and Lisa Palmer!
Justin Strickland started in the industry in 2012 as a minimum wage hood technician working for Express Oil Change and Tire Engineers. After a year, he began working for Jiffy Lube as District Sales & Operations Manager. Through the floor level experience with customers, he felt like there was a better way of doing things. And so, he formed a business plan and proposed his idea to several venture capital firms and lenders in which he was denied funding numerous times. Justin's grandfather collateralized the family home to fund his grandson's vision with a $35,000 HELOC loan. From this, the company has grown to nearly 100 open units and 200+ more committed units to open.
Lisa Palmer is the Director of Franchise Development for Strickland Brother’s. She has extensive background in sales and marketing, beginning her career with Express Scripts as a proposal writer, before moving to a sales coordinator position. In 2008, she opened her own business, PerforMax Fitness Professionals. She’s also a CycleBar franchisee, owning 2 studios in Charlotte, NC.
Luck is where you’re willing to look. Justin might not have struck fossil fuel but his idea about the oil change business is GOLD!
Ready to make your own “luck” through Franchising?
Tune in to our Podcast to learn more about everything you WANT and NEED on franchising, investment, financing processes and options.
This is Eye On Franchising, where we share our vision for your franchise future.
https://www.facebook.com/lance.graulich
[00:00:00] Lance: Welcome to Eye on Franchising. Are you looking for business opportunities? Well, you are in the right place. We represent over 650 franchises and business opportunities. We will help you find your perfect franchise for free. We even have a free assessment on our website that will help us to determine what the best businesses for you, based on your investment level, mindset, skillset, and life experiences.
[00:00:30] This is Eye on Franchising, where we share our vision for your franchise future. I'm your host, Lance Graulich. Each week, we will speak to fascinating folks from the world of franchising. Franchisors and founders, franchise funders, and franchisees. Are you looking to find your perfect franchise or perhaps you are an independent business owner looking to grow and scale your business by setting up a franchise, either way, our team can help you Eye on Franchising where you will learn the a to Zees of franchising.
[00:01:07] Welcome back everyone to another fabulous episode of Eye on Franchising and today another special group of folks, this is going to be a good one. Let's do the introductions. The first individual I'm going to introduce, she has a sales and marketing background. And of course, she's a mom of three.
[00:01:25] I say, of course, the hardest job in the world. She launched her own fitness brand back in 2008, 2015, she became a multiunit franchisee of CycleBar and in 2020, she got into franchise development and 2021, she joined. The franchise Fastlane family as the brand director of today's featured brands, Strickland brothers, 10 minute oil change.
[00:01:49] Welcome Lisa Palmer.
[00:01:50] Lisa: Thank you, Lance. Super excited to be here. So happy you reached out and wanted to, have us on and just really looking forward to the next 30, 40 minutes with you.
[00:01:58] Lance: Awesome. We're going to get to the demo where you do the oil change just in a few minutes. Let me introduce you to the, the man, the myth, the legend.
[00:02:06] He's all of those now. So it started 10 years. Everybody at one point, I think started as an hourly employee. Well, he certainly was 10 years ago doing oil changes. And, over a year later he started working for. One of the major brands, Jiffy lube eventually made it to the point of a district sales and operations manager.
[00:02:26] He always wanted to be his own boss and like all great franchise brands. He knew things can be a lot better than they were. So he put a business plan to. Which is good. It wasn't on a napkin. I hope, but we'll talk about that. Presented this idea to quite a few lenders, venture capitalists banks, et cetera, lo and behold, he got rejected.
[00:02:48] When all else fails go to grandpa and a brand was born. So a hundred of them open today, 200 more in development. Coming soon. He's the founder and CEO of Strickland brothers, 10 minute oil change, Justin Strickland. Welcome.
[00:03:06] Justin: Thanks Lance. Appreciate the introduction and the kind words and echoing Lisa. Very excited to be on with you today and to answer any questions that the audience may have for the next 30 to 40 minutes.
[00:03:15] So thank you for having us.
[00:03:16] Lance: Wonderful.
[00:03:17] Thank you. Thank you. So, Lisa, let's start with you fill in the blanks. What did I leave out of your story? How did you get into the franchise world? Really? And what do you love about the franchise world now that.
[00:03:29] Lisa: Yeah, great question. So I always say people fall into franchising.
[00:03:32] You just really don't plan for that. So, after being a business owner, you know, it was a business, it was a brand I created and, you know, did all the hard work that Justin has done so well. And, you know, it was just a very, very, it was a lot for me. So kind of took a break from that. Did the stay at home mom thing for few years, but you know, still had that, that hunger for business ownership, but I knew I didn't want to start something on my own again.
[00:03:55] I thought that franchising would be a good option because I'm not doing that. No. And all the hard work is done, you know, and franchising, you know, the, the plan is laid out and the franchise owner just needs to execute it. So I always thought there'd be so much support within franchising. And I was 100%. Right. So, you know, passion or fitness has always been my passion and really my background.
[00:04:15] So when looking for my next path, I was really into indoor cycling at the time. And. You know, this was the early, early days of psycho Barb. I was speaking to their leadership team before they even launched their franchising. So I was actually connected with them right. As they launched, I made it out to their second discovery day.
[00:04:35] I signed my franchise agreement in 2015, opened my first studio in 2016, second studio in 2017. And. They're still running here in Charlotte, North Carolina. So, it just taught me so much. And I was absolutely right. The amount of support within franchising is tremendous. There is support every step of the way from development, through operations and training and marketing.
[00:04:57] You're not left to figure anything out. It was, you know, Doing that got me where I am today. it's taught me so much and now I love that I've transitioned, you know, onto the development side. So this is, you know, a whole other avenue for me, but I feel like it's given me such a unique insight into this world, having years as a business owner.
[00:05:15] Now, coupled with some years, you know, on development, I just find so beneficial when I'm speaking to candidates because you know, they can really resonate with me just, i've had. That experience I've been on the other side of those phone calls, I've been the one making the inquiries. So it's been a fabulous experience and I don't regret any of it for a minute.
[00:05:33] Lance: Love it, love it. So Justin, fascinating story. Just love it. And I think your story and you personally, of course, Lisa helping are certainly no secret to your success. So let's take it way back a little bit. Fill in the blanks. Amazing success story where you are today in the oil change.
[00:05:53] Justin: Yeah. I appreciate that.
[00:05:54] Lance, as, as you mentioned at the start of the podcast, I've started about 10 years ago as a minimum wage biz technician working for a now competitor. And you know, it was bringing home paychecks of less than $300 a week and I was a newlywed. At the time and I had a son that had just been born. So if you've never lived on minimum wage, you probably can't relate to what I'm saying, but just coming up with the money to pay a power bill is like almost impossible.
[00:06:18] And so I think the initial, why for me was just the competitiveness and hunger to provide a better life for my family, which has the fast growth through various competitors, to a district sales and operations person for Jiffy Lube. And then ultimately. Having exposure to multiple brands that are now competitors led me to believe that there was a much better way to take a dated industry and then put technology behind it and kind of a, a more modern vibe, to it, and then compete with some of the legacy brands, so to speak.
[00:06:47] And so when we put that business model together, and as you said, we took it to a number of venture capitalists and lenders and banks. And unfortunately, 6,000 bucks to my name at that time and was asking for like a million bucks. So I understand they were looking at those pretty high risk. And my grandfather who was just an incredible figure, a figure in my life called me one night and asked me to come eat dinner with him and my grandmother, which I did regularly.
[00:07:10] And he was a tobacco sharecropper and a meat butcher. Wasn't like he was, he was never a business owner or a C-suite anything. I think he maxed out at like 10 bucks an hour, his entire working career. He raised four kids and, you know, five or six grandkids, just the ultimate servant leader, had an appraisal done on his house that my family had been in my family for 70 plus years.
[00:07:30] And the appraisal came back at $61,000 in 2012. And, so he agreed to match. For 35,000 bucks off, we went, that was not nearly enough money to start one of these, but we did. And about four months later, we, we nearly bankrupted at no fault to the operations, but it was a dark asset that previous competitors had gone out of business in, but it was all we could afford from a lease stand point.
[00:07:53] To get into it. And so I personally, along with Mark Hagan, who's our VP of franchising still with us today is in the office behind me, went in and painted it. And we hand built the podiums in it. And anything we could do to save money, we, we did February of 2013 was nearly time to pack it up. And fortunately we had our first profitable month the next month.
[00:08:14] And we scaled. Company to three locations and I guess two and a half years. And then we sold that company at a pretty decent, multiple, we negotiated very small non-competes with who we sold to knowing that we were going to reform recapitalize. And now that we have the capital to turn around and reinvest into what's today, Strickland brothers, 10 minute oil change in 2016.
[00:08:34] So. We started the first location in December of 2016 and sat on it for about 18 months, which was hard because I really wanted to scale quickly. But I thought it was important now that we had the resources financially to invest in certain integrations, as it relates to marketing and figuring out the algorithms and letting campaigns fully mature, which just takes time.
[00:08:53] And once we felt like we had that figured out, we started scaling . Corporately and really 2018 summer of 2018. So we added our second location in the summer of 2018. We added a corporate site about every 30 to 45 days for a year to prove out concept and did really well with that. We started franchising in 2020.
[00:09:14] We awarded our first agreement, April 7th to 2020. And since I've awarded over 200 licenses, so we're very. To be in the space that we're in. We attracted a lot of private equity firms over the course of the last few years.
[00:09:27] Lance: So now, so now it's no problem when you don't really need the money. All of a sudden, there it is.
[00:09:35] Justin: Yeah. That's typically how it works. I think. And so for me, franchising is really about helping people find that passion. And entrepreneurial-ism just like I have, so we've got several franchise owners that have sent me emails, thanking them with a concept, which, which is almost funny because they're the ones doing the work.
[00:09:50] You know, we have the model, but they're out there, they're out there getting it. And so several of them.
[00:09:55] Lance: You changed their life? It sounds like.
[00:09:57] Justin: Yeah. Yeah. Well collectively they, they, they put forth the work and we give them the business model. So it's certainly a team effort and very thankful, you know, where we are today.
[00:10:05] And I really think we're just getting started. We're making some monumental shifts. I feel like every quarter at this point, in terms of support and infrastructure,
[00:10:13] Lance: I love it. I love it. So let's take it back a little bit what. What really was the pivotal moment from developing those corporate stores with Strickland brothers, 10 minute oil change, whose idea was it to start franchise?
[00:10:26] And that was going to be your vehicle so to speak.
[00:10:31] Justin: It was, it was my idea. I wanted to scale across the country and build a big business, but I felt like we had a, we could identify some gaps to do it through franchising. As we started to scale, I quickly recognized that one person running 500 of these things would be much more like human capital intensive and the service for the customer, which is ultimately what matters.
[00:10:51] Wouldn't be as good. Whereas if we have. A hundred franchise partners that were aligned with us and they, they believe the same mission, the same values, and they followed the business model. And the service at the unit level, would be much better than, than a corporation running five or 600. Now with that said, we are still growing corporately, but we're running in parallels with franchising to scale across the country.
[00:11:13] So the. Theory there was that it would be much easier for us to scale across the country without sacrificing the service for our customers.
[00:11:20] Lance: Gotcha. Wonderful. Well, you know, you hit on something with finding the people that share your mission and your values. Either you release the, please talk about who it is you're looking for.
[00:11:32] In a franchisee in a prospective franchisee. When you have, you know, Lisa, maybe when you have that first phone call with folks, how do you know that the right for Strickland brothers specifically?
[00:11:42] Lisa: Yeah. I mean, it's all, I think it's pretty simple who we're looking for. You know, I'm not looking for that too.
[00:11:49] I mean, our, our franchise owners, you know, they're not auto mechanics or have not necessarily any kind of background in the automotive industry. There's somebody like Justin said, whose core values align with ours. Who is a leader. Who can manage a team who's active in their community, things like that, you know, or the initial thing, somebody that can, this is a proven business model.
[00:12:09] Somebody that can follow the plan that's handed to them and, and execute that. I think that some of those are some of the initial things that I look for with Justin. Go ahead and add to that, please. I'm sure there's more.
[00:12:20] Justin: Yeah, I think that that's a really good start on it. Um, you know, as Lisa said, we're, we're not really looking for out in mechanics, we're looking for business people that understand key performance indicators, they can drive them.
[00:12:32] They're also a servant leader, which is going to be really important when you have employees in your location. So this isn't like a, this can be a semi absentee model, but to be able to do that. And when you're not in the day to day, Got to be adamant and diligent about setting and meeting key performance indicators at all times, for the success of your business.
[00:12:51] So we want people that really wrap their head around key performance indicators and they're excellent leaders. That's ultimately how you can succeed in multiunit management, which is really what we're building.
[00:13:01] Lance: Love it. Love it. Love it. And let's talk about the investment. Let's uh, I know you, you do some unique things with, the real estate, so, speak to the investment range, typical investment, et cetera.
[00:13:14] Lisa: The initial investment. Estimated initial investment for one location, that two 17 to 2 87
[00:13:21] Justin: and for the real estate perspective. So this is a little bit different than a, I think they refer to them and I mean, no disrespect, but like man in a van concepts or some sort of vector, no disrespect towards, towards the concept of that, you know, the concept that you can order a van and you're ready to roll.
[00:13:37] There is this real estate and construction dynamic. And that was always going to be kind of this hurdle in a retail industry when you have single-tenant net retail. And so over the last 10 years, obviously I became very self-educated and learned some lessons in real estate, particularly commercial real estate.
[00:13:53] So we have a lot of development partnerships where we have, as of today, about $350 million in committed capital for franchise owners, real estate projects. And that's how we're able to do, some of these from much lower item seven, then going to own the real estate. Building it out yourself. And so we have this robust developer program essentially to where when franchise owners come in, we don't mandate that they use it.
[00:14:16] It's an option for them at no cost where we can partner them with a real estate team. That real estate team will then introduce them to local brokers, local developers, with some pre negotiated terms and building plans and all this stuff, to, to help them, you know, make intelligent site selections, to bring to us for approval and ultimately be.
[00:14:35] And get the zoning, right. And have the construction completed correctly and stay within brand standards. So I think there's three parts to franchising, right? You've got to have an attractive item, seven, you've got to have an attractive item 19, and you've got to be able to get open. And when there's a construction dynamic in this real estate portion to it, then sometimes that can cause a hurdle if you don't have that built out well.
[00:14:55] And I think that compared to industry standards and other single tenant net retail companies, I think that we're doing pretty well in that.
[00:15:01] Lance: Yeah, I love that you have it all figured out. Um, most people think of oil changes, but most, most people think of the oil change. Arena and obviously you do things far differently, and far better.
[00:15:17] In my opinion, you know, the real estate you've taken the real estate component out of it. You have partners that will buy the real estate, as you say, and it's just, it's phenomenal because then you have. You know, a really attractive landlord situation, I guess you could say, because the numbers have to work.
[00:15:35] You're looking at what the franchisee is going to be paying and how the deals work. Right. I mean, you're over your team is overseeing that.
[00:15:42] Justin: That's exactly right.
[00:15:43] Lance: So it's all in the best interest, obviously of the franchisee. Now, what percentage of the. Franchisees the hundred that you have open are most of them, the scenario that you laid out where the, the real estate group, so to speak those guys or that team is buying the real estate on the majority.
[00:16:01] Justin: Yep. So corporately, we own zero pieces of real estate, none. So we would never recommend a program to a franchise owner that we don't follow ourselves corporately. And in terms of the franchising side, I think we may have two units that are owned that have the real estate owned. One of them, they opted out of the developer program and ironically enough were a developer and they liked the concept.
[00:16:24] So they wanted to come in and develop their own. So they, they own. Real estate locations. Another one was an acquisition opportunity. We also have a mergers and acquisitions team at Strickland brothers that they do nothing but make phone calls and try to make acquisitions and another path to ownership that we offer here.
[00:16:39] Um, and so, you know, in some of those cases, it makes sense for, for the owner to own the real estate, not all the time, sometimes it still doesn't, but sometimes it does in terms of SBA lending and being able to extend that term to 25 years, rather than a 10 year Goodwill loan and increased. All that good stuff.
[00:16:56] So we're very well versed and familiar, with SBA structures, but in the real estate ownership. So for the most part, you have 95% plus they, they follow the same thing and have a real estate partner come in and buy the real estate that we introduced to them. But on those two occasions, a little different,
[00:17:12] Love it.
[00:17:13] Lance: So regarding some of the things you threw out, item seven, item 19, for those of you listening, the franchise disclosure document has 23 items. And if you have listened to my podcasts before I've had my friend, Amanda Dempsey, a franchise attorney break down all 23 items for that, Franchise disclosure document to help you guys play along at home.
[00:17:35] So to speak. Let's talk about the process.
[00:17:37] Lisa, describe the franchise process, you know, really how you get people in the queue, in your funnel. So to speak, you know, brokers like myself are introducing, candidates, but you know, there's obviously a first phone call and what is the product?
[00:17:53] Lisa: Yeah. So once a consultant gets their candidate registered with Fastlane, the first step is an intro call with myself.
[00:18:00] And the first call is just what it sounds like. It's just an opportunity for us to get to know each other a little bit. You know, I'm looking to learn a little bit more about the candidate. You're their background, their story, hear what they've got going on in their life. And, you know, I want to know about their family, I to know what they like to do for fun.
[00:18:15] And then I share a little bit about myself and Fastlane, just so they know who they're going to be speaking with over the next few weeks. And then we just get into some, you know, questions they might have about Strickland brothers. After that, we take it to the next step, which is the second call, which is unit economics.
[00:18:30] And it's everybody's favorite call because it's all numbers. Everybody wants those numbers and I saved it for its own special call, just because it's, you know, there's a lot of info phone. I want to make sure that I have time to, you know, walk candidates through everything, but we're looking at the item seven, we're looking at the item 19.
[00:18:45] I have an interactive workbook. I take candidates through. Where we can build out a budget, they can build a performa, they can build their investment. And then I emailed them that workbook after that call. So they have the opportunity to take some time and go through that on their own. They also receive the FDD.
[00:18:59] After that call. After that unit economics call, they get to start hopping on group calls. We have group leadership calls with Justin and the rest of the Strickland brothers leadership team. This gives the candidates an opportunity to meet the team. Very early in the process, come at them with any questions and you know, there's other candidates on the call.
[00:19:16] So they may hear something they didn't even think of. We also have group franchisee validation calls and these calls recur every week. So candidates can hop on these as often as they like, but the validation calls are with current Strickland brothers owners.
[00:19:29] Lance: And describe how the validation calls go.
[00:19:32] I mean, is there's an opportunity to ask questions or how does that.
[00:19:37] Lisa: Yeah, it's just open forum, Q and a. I have that. I have a handful of great Strickland brothers, current, current circle of brothers owners. I rotate out and candidates hop on and they just ask a way, you know, it's just a, it's a great perspective for them to hear that, you know, from a franchise owner, they can hear things from me all day or from, you know, the corporate team.
[00:19:57] But I think it's such a wonderful opportunity, to hear. You know, a day in the life of a current owner, what it's like to be a multiunit owner. You know, things like that, that early in the process, which I also love, then we get to the mapping call, which is everybody's second favorite call. Cause we're looking at territory.
[00:20:12] So yeah. They want to see what is this look like? So I get to present a potential territory for them and, you know, we kind of build it from there. And then, after that, you know, that those are kind of all the big, the big steps in the process that lasts. The check really is coming up for confirmation day.
[00:20:31] You know, that's that last box you checked before signing your franchise agreement so that they get to come out to Winston Salem spend, you know, a couple of days with the leadership team, Strickland brothers, they get to spend some time at Lindbergh. Getting a full real estate presentation. And it's just a great opportunity for them to immerse themselves in the brand and the rest of Strickland brothers.
[00:20:52] And again, it's that final checkbox. And then typically about 10 days later or so they're, they're signing a franchise agreement and then they're, they're off
[00:21:00] Lance: and they're off. And typically from the time they come to confirmation day, when they actually sign their franchise agreement, which is thereafter, what is really the average time these days to get their first location open?.
[00:21:12] The great
[00:21:12] Justin: question. So again, there's two parallel paths here. We've had some folks that have came in the system and we've had a pretty hot lead on an acquisition trail, which is certainly the fastest, the acquisitions. We, we can't promise that there's an acquisition in, anybody's said territory, that's available at a good price point, et cetera.
[00:21:31] But as soon as an acquisition is under LOI. Which is a letter of intent to purchase. LOI to closing typically takes 90 to 120 days from the time we find one and have it under LOI on a full build to suit. We've had some that have been anywhere as quick as 12 months and some as long as 15 to 16 months. And so it really just depends on the municipality challenges, which we can certainly help them with, obviously in the Northeast or Colorado, sometimes municipalities take a little bit longer to get through permitting, to be able to start vertical construction.
[00:22:05] So that timeline. The site selection is heavily kind of on the, on the franchise owner. We're assisting with that and partnering with local brokers and things of that nature. But if there's availability and affordability in their market and they're familiar with their market, some owners find sites faster than others.
[00:22:21] And, you know, bring those in for approval. From that point, it's really doing the due diligence on the dirt to make sure it's clean, make sure it's zoned properly. And during the due diligence, the development partner is sending all the prototypical building plans to architecture and engineering, to start preparing for permitting.
[00:22:38] They're bidding it out to general contractors and that process, we really can't control municipalities, but as soon as that is done and through permitting and we've got the building permit, we close on the real estate end, the vertical up construction component pending. The pen is anywhere from 90 to 120 days.
[00:22:54] Lance: Got it. Now it's I mean, lucky you, you haven't dialed in. So the franchisees or prospective franchisees that are hearing this, it's all covered. Strickland brothers has it covered. That's why they've got a hundred already done and many more coming.
[00:23:08] Justin: We've gone down quite a lot.
[00:23:11] Lance: So let let's talk about, so your, if you're going to look at your.
[00:23:16] Top 10% of best franchisees, okay. Name them. No, I'm just kidding. Don't name them. If you're thinking about the top 10% in this case, 10 franchisees, roughly right now, what do they all have in common? You know, what is, is there a background? Is there, are there certain traits or characteristics because clearly you're paying attention to this.
[00:23:40] And th that goes into the selection process for the future.
[00:23:44] They are.
[00:23:44] Justin: That's a great question, Lance. Our best franchise owners are competitive. They are engaged. They are excellent leaders. They are. And, so, you know, they're making KPIs, they're in communication with their managers even though they're not, I don't think our top percent or our owner operators necessarily, although there's one or two that are pretty successful, that are the ones that are not are talking to their managers regularly.
[00:24:11] So they're not letting you know, not letting the stores operate for two, three days without any communication. And so to piggyback that, I would say the bottom portion are the ones that don't make KPI. They look at it more as a passive, fully passive investment and they kind of let the manager run the show entirely and do everything.
[00:24:30] So again, they're engaged, they're numbers driven. They're very passionate about their business. They're great leaders. Those are highly competitive.
[00:24:38] Lance: Great. And KPI's, I don't know if we set it are key performance indicators for those folks listening. We should have an acronym, a key at the bottom of this, in the show notes.
[00:24:49] And if that, anything to add in the beginning stages. Is there something that you've noticed, you know, as you and Justin talk about the, the high performers and, you know, I dunno if there's school teachers out there or lawyers or management folks, the typical corporate refugees that didn't like their job anymore.
[00:25:07] Are there any commonalities that you've noticed so far?
[00:25:11] Lisa: You know, not really. I think, you know, Justin really hit it on the head. I think the story though, that I hear most often with candidates are those, you know, corporate refugees, somebody who is looking, you know, they're at that stage in their life where everything's kind of shifted, kids are grown, they're out of the house.
[00:25:26] They're looking for what's next, you know? So they're looking for that next opportunity. And so that's, that's kind of, I I'd say a good chunk of my candidates are they're looking for something for themselves.
[00:25:36] Lance: Got it.
[00:25:37] And what out of the hundred stores at this point, or, or you could even talk about the future owners, the additional 200 that are in some phase of development.
[00:25:47] How many are going to be multiunit? What percentage of those 300? Let's just say, where are they going to have more than one location?
[00:25:55] Justin: Probably 90%. The majority of our. Yeah, our multiunit owners, you know, we're, we're built for scale. And that was a goal behind Strickland brothers was to try to simplify the business model, make it very easy, to understand, make it easy to train on and allow people to scale.
[00:26:12] So I, I would say at least 90% of them are multiunit.
[00:26:16] Lance: Well, where I come from having owned franchises before myself. Uh, I know that when there are multiunit owners and quite a few of them, I know there has to be some good economics. Obviously you're paying attention to the KPIs. You can talk to. Each in, you know, the you'll have an opportunity at validation, but now let's talk a little bit about the item 19.
[00:26:38] The item 19 in the franchise disclosure document is the financial representations, earnings claim, et cetera. And some brands just put sales, you know, in various categories and other people put margins. Well, what do you show in general in that category for people to get excited about?
[00:26:55] Justin: Yep. So in item 19, for our 2020 1, 20 22, hasn't been filed yet, but 2021, a franchise disclosure document item 19, we focused on EBITDA, which is earnings before interest taxes, depreciation, amortization, most businesses are valued on EBITDA.
[00:27:12] And so we understand that our owners, in some cases, or everybody starts with a why, like, why are they getting in business? Some of them are, are wanting to build a business to sell it and make money. And one thing that makes us an attractive option is there's recurring revenue, which naturally increases your earnings multiple, which would be based on EBITDA.
[00:27:30] So, our item 19 will show EBITDA and out of the locations that are disclosed in item 19 for 2021, the average EBITDA was $145,000.
[00:27:40] Lance: And obviously you don't have people signing up for multiple locations, unless they're really happy with that, that ROI. So. Great job on that. And from, from experience, I'm sure that'll continue to even grow from there.
[00:27:52] It's pretty amazing the power of your, of your brand. And as you guys continue to grow and become that beacon for people to understand, you know, the Starbucks of oil changes. Did I just coined a phrase? I don't know if that's good or so what, what I wanted to also talk about when it comes to, well, we talked about selection.
[00:28:09] We talked about selecting franchisees. We talked about the fact that it's quite a few of your folks are multiunit operators. So one thing I forgot to ask is regarding the revenue streams, this isn't just the oil change business, although that's a lot of your business. So share with us what your revenue streams are besides oil changes.
[00:28:28] Justin: Of course. So at Strickland brothers, we offer basically seven services. A lot of them are preventative maintenance, obviously all changes being one, but we also offer an air filter services, cabin, filter services, wiper blades, light bulbs, state inspections, and states that have state inspections, tire rotations, and a couple of select additives as well in some of our locations.
[00:28:49] Through the acquisition channel. We're not building them currently. We also have some carwash concepts that are attached to some of the merger and acquisition opportunities that we have. So a couple of different revenues there the additional services in a, in a normal service center typically encompass 30 to 35% of the revenue.
[00:29:05] So it was pretty healthy and meaningful.
[00:29:06] Lance: Sounds fantastic to me, sign me up. So what, what, Lisa or Justin, or both of you? What, what did I miss today that we need to. Have the listeners know about Strickland brothers
[00:29:17] Justin: I think from my perspective, and then Lisa, I'll kick it over to you to end it. But I think the important part is understanding in any franchise network.
[00:29:25] So whether someone decides to franchise strict on brothers or, or somewhere else, you need to really vet the franchisor. We were ensure that they're there for the best interest of the brand. I would start with. Start with the CEO and find out what their, why is, why are they even in business? Why are they doing what they do?
[00:29:39] And for me, it's changed over the years. Initially, as I mentioned earlier on the podcast, it was to simply not make minimum wage anymore and be able to provide for my, my kids and my family and have the opportunity to grow. And, you know, as, as time has gone on has certainly shifted where it's not at all about money.
[00:29:55] If the board decided tomorrow that my salary was $0 I would show up. Tomorrow and come back to work, with a smile on my face. So I really enjoy what I do. And my why is almost like a reverse funnel impact. I really hope to impact not just the people in our office, but outside of it, our franchise owners, our store level employees, I'm heavily driven by the development of our brand and ultimately our people.
[00:30:15] So I think that that's an important understanding that the listeners need to have of Justin Strickland. And ultimately if Strickland brothers isn't the brand for you, I would strongly recommend that you vet the CEO on what their, what their missions are and what their why is.
[00:30:27] I love it.
[00:30:28] Lance: I love it. Love it.
[00:30:29] Lisa, any additional thoughts?
[00:30:32] Lisa: Final few thoughts before we wrap up, you know, I just want us to speak to this opportunity itself. I mean, it's just such an amazing unique opportunity, you know, especially that real estate piece is so unique. Not only in this industry. But in franchising in general, and to be able to own this brick and mortar location for such a low investment opportunity is really unheard of.
[00:30:54] I liked, I used myself as an example here being a business owner and I pay rent on both of my studios, but I also had to incur all of the construction and all of the build-out costs and all of the headaches that came along with that. So when I learned about this opportunity and that I would be representing it, I was like, holy cow, where was this years ago?
[00:31:11] When I was looking for an opportunity. Cause that's. I would have jumped on this and unfortunately we are sold out in Charlotte. So, you know, unless I go somewhere else, but this, this opportunity is amazing. I would love to share it and talk more with anybody that's listening. Anybody that just, you know, has a passion for multiunit business ownership and looking for something semi-absentee, you know, let's chat.
[00:31:32] I would love to tell you more.
[00:31:33] Lance: I love it. I love it. Well, thank you, Lisa Palmer. Thank you, Justin Strickland, Strickland brothers, 10 minute oil change. Amazing episode. Thank you both.
[00:31:41] Lisa: Thanks Lance.
[00:31:42] Justin: Thanks
[00:31:43] Lance.
[00:31:43] Lance: Thank you very much for listening today, please like following subscribe. So you don't miss anything here at ion franchising.
[00:31:51] Visit our website @eyeonfranchising.com & ionfranchising.com and complete our free assessment. So we can assist you in finding your perfect franchise. This is Lance Graulich until next time.