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Online Edition

Turning Homeowners into Landlords


FEBRUARY 2009 I ISSUE 479

BusinessOpportunitiesJournal

SpecializinginBusinessOpportunities,FranchisingandRealEstateInvestments
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Pet Related
Opportunities
Special Report Section

Bark Busters - Speaking Dog


....
Pet Butler - Scooping the Poop
....
plus+
Central Bark Doggy Day Care Willmar Pizza Family Expands
....
....
Matthews Cremation
Martinizing Turns 60
....
....

Directory of Pet Opportunities Forest Beetle Blues - Or Opp?


....

Scaled Down Phoenix Homes


....

Foreclosure Rates up 81%

BusinessOpportunitiesJournal
SINCE1969 | CELEBRATINGOUR40thYEAR

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(ISSN 0193-3221)

Business Opportunities Journal

contents

ISSUE 479 / FEBRUARY 2009

20

8
13

16

special report:

pet related opportunities


Introduction to Pet Opportunities P.4
Interview with Bark Busters CEO P.8
Pet Butler CEO, Matt Boswell P.13

34

franchises

business opportunities

Licensing Key for Einstein Growth P.31

Forest Beetles Turned into a Profit P.40

Willmar Familys Pizza Expands P.32


Martinizing Turns 60 P.34

Central Bark Cofounder, Jackie Jordan P.16 Fast Food Outsourcing in Charlotte P.35

Small Business Woes Have Big Impact P.41


Pasta Makers Business Cooking P.42

real estate investing

Matthews Cremation P.20

Tulsa Man to Expand Dippin Dots P.36

US Foreclosure Filings up 81% in 2008 P.45

Expert View: Economic Outlook P.24

NV Ranks 2nd for Business Climate P.39

Real Estate Pioneer T. Crow Dies at 94 P.46

AKC Economic Survey P.26

Don Callender dies at 81 P.39

Directory of Pet Opportunities P.28

Scaled-down Phoenix Houses P.48

How to Pick a Dog Collar P.30

Oahu Office Vacancy Rates to Climb P.49

Seattle Man challenges poop law P.30

Times Turn Homeowners to Landlords P.50

Business Opportunities Journal

Special Report Section

e
love
our pets!
And why not?
Theyre not just
loyal companions theyre
a part of our
families.

The Time is Right for


Business Opportunities Journal

They are such a part of


American life that one
might not realize that
they translate into big,
big business. In fact, total

U.S. pet industry expenditures


for 2008 are estimated to be
$43.4 billion, as gathered by
the American Pet Products
Association (APPA) from various market research sources.

r Pet Related Opportunities


5

Business Opportunities Journal

Opportunities

PetRelated

Thats up from an
estimated $17 billion in total pet
industry expenditures in 1994. Some
put the figure for
2008 even higher.
What is behind this
industry
growth
and size? In part, it
is as simple as consumers deep-seated love of their pets.
But also, pet ownership is growing. According to the American Pet Products
Association,
63%
of U.S. households
own a pet, which
equates to 71.1 millions homes. Thats
up from 56% of U.S.
households in 1988,
the first year the survey was conducted.

Business Opportunities Journal

AlreadyBig,ButGrowingStrong

Plus, there are more and more products available for pets. Not
only has there been a proliferation of pet products, but also there
has been an increase in professional services available. From pet
waste removal, innovative pet (and owner!) training, doggy day
care, kenneling and grooming, to complete funeral services and
related memorialization services to address the grief of losing a
pet, todays pet lover has it all.
With many of these services available as franchised business
models, and with many of these services being relatively new in
comparison with other franchise categories, entrepreneurs interested in franchising should take a good look at the pet related
opportunities currently available. Many excellent territories still
exist.
As readers will see, a big caveat for many of the opportunities is
that entrepreneurs must first ask themselves, do I love pets? If
the answer is yes, then the time might be right for a good look
at pet related opportunities. In the pages that follow, Business
Opportunities Journal interviews executives from across the pet
related opportunities spectrum, including pet training (p. 8),
waste removal (p. 13), day care (p. 16), and pet memorialization
(p. 20). In addition, we have selected fifteen opportunities for inclusion in a directory of pet related opportunities (p. 28).
But what about the outlook given the current economic conditions? Many (including us, see our January 09 edition), have
predicted that pet related businesses may be more recession resistant than other industries. But what do the experts think? We
asked Pet Care Services Association CEO, Joseph Lyman, to comment on the current economic outlook (p. 24). In addition, take
a look at the American Kennel Associations recent member poll
(p. 26), which has some good news for the industry despite the
harsh economic times. --Mark Adkins

Business Opportunities Journal

pet training

Teaching People to Speak Dog with an Aussie touch.

Bark Busters: A
Lot More to Say
than GDay
B

ark Busters has grown rapidly, garnering many


industry awards along the way for its innovative training techniques. Recently, I met with Bark
Busters CEO, Liam Crowe and Director of Franchise
Development, Joan Trinka, to discuss the growth
of the business, why entrepreneurs are acquiring
Bark Busters franchises, and goals and objectives
for the future. --Mark Adkins
BOJ: How did Bark Busters get started?
Liam: Bark Busters started in Australia. The company was formed in 1989 by Sylvia and Danny
Wilson and at the time, Sylvia was running an RSPA
shelter similar to the ASPCA or the SPCA here. She
was saddened by the number of dogs that were
euthanized due to behavioral issues that she knew
she could fix in minutes. I dont know if youve ever
been into a shelter where there are dogs barking.
It is earsplitting, deafening. She could train these
dogs literally in minutes to be calm. Thats how
Bark Busters started. She was just sick and tired
of seeing dogs euthanized when she knew she
could help them.
BOJ: When you say train them, do you mean that
they had a behavioral change that lasted minutes
or that actually lasted forever?
Liam: They literally have a behavioral change. To
give you some background on the philosophy of
the company, its really to teach owners to speak
dog. Its communicating to dogs in such a way
that they understand that there is leadership
around them -- where they dont have to fret or
worry or be anxious. We see this time and time
again when we go to clients homes. After weve
explained the philosophy of the system, within
minutes the clients can communicate with their
dog. This might be a dog that has been doing
something for the last five or ten years, like barking when people arrived at the door or jumping
on visitors or showing signs of separation anxiety
or fear aggression, and in a matter of minutes, you
can calm that dog down. Youre communicating
in a way that the dog understands. You walk into

Business Opportunities Journal

(Above) Bark Buster trainer Connie Archer & client in Houston, TX.

the persons house and the dog says Ah, finally


someones here that I can understand!
BOJ: Does this work for every dog? Or, are there
some dogs for which it doesnt work?
Liam: Really, its that there are some owners that
dont get it. No one can guarantee a result. What
we guarantee is the support for the lifetime of
the dog. If you say to me that my dog has bitten
15 people I cant guarantee that it wont ever bite
another person, but I can guarantee that Ill support you for the lifetime of a dog.
Joan: We are ranked to the best of the best in pet
service training by the International SPCA. Thats
the international form of the Humane Society. And
they dont give that out easily, so they recognized
how able we are to turn a dog around.
BOJ: You mentioned that people do not have to
have experience in this line of work to become
successful as franchisees. But is this something
you can teach anyone to do?
Liam: My wife and I were clients of Bark Busters.
I am the typical dog owner in so much as I grew
up with dogs and had dogs all of our lives and
thought we knew what we were doing as far as
training them. But then we got Buddy, who is still
with us to this day mind you. He is an Australian
cattle dog/border collie mix. He is about 16 1/2

A conversation with Liam Crowe, CEO of Bark Busters, and


Joan Trinka, Director of Franchise Development.

has an animal or a dog just loves talking


about them. Its really just opening up that
dialogue.

now. Well we got Buddy and we tried everything else that we had tried with previous
dogs and it just wasnt working. We were
at our wits end. We tried various trainers.
Then one day we spoke to our veterinarian.
Ironically, to this day, about 40%
of the work we receive or inquiries that we receive come from
recommendations from the vet.
So he said Call Bark Busters. So
we called them. We were just
absolutely blown away by how
quickly and effectively we were
able to train our dog Buddy.
That was it. We said we want to
do this for a living. So, with little
or no dog training background,
we were trained by Danny and
Sylvia, the founders, and here
we are today. Weve been doing
this since 1995.

We definitely train them with the skills that


they need to network and phone abilities
to close sales with prospective clients. Its
beautiful from both ends because if youre

BOJ: Do successful franchisees need to have


good networking skills to bring in business?

Liam: We do have quite a rigorous selection


schedule for potential franchise owners. This
includes doing a profile on them to (Below) Bark Buster trainer George Kleva from New Jersey.

Its not necessarily someone


whos got a dog training background thats going to be successful. What we have found
is successful franchisees know
how to build relationships. They
are looking at this as a business
as opposed to a hobby.
BOJ: I know the business model
is one that the franchise owner
can conduct from his or her
own home and that the services
can be provided at their clients
homes. I also know that the primary revenue
model is to provide training. Is this a model
that works in all regions of the country or is
it better suited for some areas?
Joan: It is an urban-suburban type model
because it really is about working with
dogs and people where they overlap. Thats
where dogs behavior matters. We assess the
territorys statistics before we look at selling
any marketplace. It really needs to fit the
dynamics of our model as far as household
counts, targeted dog counts (a number that
we have refined), and vet clinics, which are
important for marketing.
BOJ: Are there good areas still available?
Liam: Oh yes. For example, markets like
Oklahoma City, Kansas City and others are
still open.

make sure that they have people skills and


that they are business-minded. Obviously,
liking dogs is important, too.
We have a four week training course. We split
it up with two weeks done remotely at the
beginning and end of the course, and two
weeks of intensive hands-on dog training
in Denver.
The beauty of this business is that you could
be standing in a mixer or a Chamber of
Commerce networking function--Ive done
this myself--and stand there just with your
Bark Busters shirt. People will be drawn to
you because they love talking about their
dogs. This is not a hard push or a hard sell.
We market to vet clinics to help them with
their clients that are frustrated with their
dogs. Anyone from any walk of life that
9

a dog owner yourself, and 99.9% of our


franchise owners are, you love talking about
dogs, and so do your clients.
Over and above all, we have a professional
marketing team and a PR and communications firm that we use that generates a lot
of press for us. Last year alone we got 700
unique stories in the country.
Joan: We actually have a trainer whos going to be on Martha Stewarts TV program
tomorrow!
BOJ: How are you so good at teaching
people to speak dog?
Liam: We have a saying that we train people
the Aussie way. People the world over know
that Australians have an affinity for animals.
You see this on the shows, particularly
our long-lost friend the Crocodile Hunter.
Business Opportunities Journal

SPECIAL REPORT | PET RELATED OPPORTUNITIES


There are other qualities that distinguish
us from our peers. For one thing, we come
to the clients home. This is really important
because for a lot of people this is where
the dynamic of the family is obvious. This
is also where a lot of the issues are occurring. So, we train in the comfort of the
clients home. We are able to get results
very quickly and very effectively as a result.
More importantly, we offer clients a lifetime
guarantee which is transferable across the
world. Bark Busters as a company has about
400 offices across the world. Weve trained
about 500,000 dogs collectively. So, if you
were to move from, say, Denver to Phoenix, and theres an office there, they will
honor that guarantee free of charge.
That is absolutely unique in the
dog world to have something
as powerful as this lifetime
guarantee.

as well. Also, dog walking services, pet sitting services, and poop scooping services.
The amount of money that is created by the
pet industry is just phenomenal. We want
to be able to tap into that to be able to enhance our existing franchise owners ability
to earn as a professional services provider.
BOJ: What are typical backgrounds your
franchisees have?
Liam: Weve got people from all different
walks of life. Weve got scientists, police
officers, teachers, former business owners,
all sorts of people. The fact that they
can be their own boss with the flexibility of the lifestyle in terms
of hours is a huge attraction
to people.

Joan: There are three


types I see frequently
who are much more
satisfied with Bark Busters than in previous
In the first visit, were there
careers. First,
for about 2 to 3 hours and
management
we get results for the peoprofessionals
ple. Sure, we follow up
from corpowith as many followrate America.
up visits as we need,
They get
but the fact that we
rid of the
can get there and
headaches
show them how to
associated
communicate in such
with mana quick and effective way so
aging
many
(Above) Liam Crowe & friends.
that the dog gets it and they
employees and
get it and then theyve got the
they now have the ability to run everything
insurance policy, as I liken it to, where they
themselves. With Bark Busters, they are
can call us and well come back and do
building equity in themselves and cant be
follow-up work.
downsized as in corporate America. They
BOJ: What other revenue streams exist for
have the ability to multiplex themselves
franchisees?
and be responsible just to themselves. The
second type are technology people (as long
Liam: We are finding ways to allow franchias they have people skills). They get to go
sees to make passive residual income. For
out and troubleshoot. Then they see the
example, a client that you have may make
results in a couple of hours. Its not like a
purchases of various supplies from our
project they work on in the tech industry
website and then these are shipped directly
where they worked on something and
to the client. The franchise owner doesnt
two years later 20 different people change
even have to touch the products but still
something and it doesnt work. Military
gets a percentage of the sale. That includes
people are a third group of people in frananyone in their territory even if theyre not
chising that have been really successful. In
an existing client.
part because they really get the pack order
We want to develop additional revenue
thing. [Laughter]. They have an innate abilstreams for our franchisees. If youre talking
ity for leadership.
about recession resistant items, everyone
BOJ: What kind of advertising and marhas to feed their dogs, so were getting to
keting support do you provide for local
the point where were delivering dog food
franchisees?
Business Opportunities Journal

10

Liam: We are constantly tweaking that


to try to get the best advertising or marketing that we can get for our franchise
owners. We have PR campaigns as well as
advertise nationally . On yellowpages.com,
for example, if you were to do a search for
dog training or pet training in any city,
Bark Busters would come up number one
on every single city page. That drives a lot
of business to franchise owners. Also, we
have a big presence on the web in terms of
organic searches and pay-per-click. One of
the things that we try to give our franchises
is the opportunity to reach out to the local
media or the local community with the
message that, for example, its national bite
prevention week, or its child safety week,
etc. We put all those things out there for
our franchise owners and they in turn try
to engage the local community. We even
prepare presentations that they can make
to the local community
Joan: We have a series of ongoing marketing promotion programs for franchise
owners. Plus, they are all networked together. So, any idea that theyve tried locally
spreads through the franchise network.
We have everything available for a complete campaign. Theres a campaign on
the Naughtiest dog contest that the local
Bark Buster can use with a local television
station. They pick a dog, complete the training, and then come back with a trained dog
on camera to promote their local business.
BOJ: In is there an ongoing royalty?
Liam: It is broken into two components.
You pay a royalty of eight percent to the
home office based on gross revenue. There
is also a two percent national marketing
fund which supports the marketing weve
discussed.
Joan: Our business is about building a
profession of being a dog behavioral
therapist. Franchisees pay royalties based
on when they earn the money. So they
have freedom. If theyre off on vacation or
something, theres nothing to pay. Many
other models have minimum payment
requirements--we dont.
BOJ: How much has Bark Busters grown in
the United States?
Liam: Well when we first arrived here, we
thought, We better train dogs here and
make sure that they speak the same lan-

SPECIAL REPORT | PET RELATED OPPORTUNITIES


guage here as they do in Australia. Sure
enough, they did. It took us 2 years to sell
10 franchises. From there, once word got
out that yes, you can make a living out
of it, and yes, its fun, it really spread like
wildfire. We are at around 255 franchise
locations now. In the last five years we have
had explosive growth.
BOJ: Have you had growth in same-store
sales as well?
Liam: Absolutely. People in the United
States are absolutely gaga about their
dog. When we got here, the pet industry
was about a $20 billion industry. This year
its about a $52 billion industry. Next year,
theyre talking $55 billion. People have a
love affair with their dogs. And they will
spend an inordinate amount of money on
their dogs. Dogs are part of their family.
BOJ: Would you characterize the industry
as recession resistant?
Particularly in the current climate people
become a little bit insular. The family unit is
particularly important. We find that people
might not be going out and spending as
much money on going out to dinner, but
the fact is they want their dog to be happy.
Its almost a priceless commodity that we
provide because imagine if we come to
their home and within 2 to 3 hours get rid of
all that stress thats been brought on by the
communication not being clear between
dog and owner. They will pay whatever they
need just for that harmony. They love to see
their dog happy because its unconditional
love for their dog.

growth is based on someone opening a


territory area and the results of their work
gaining more and more momentum for the
business as far as selling more franchises.
BOJ: When you brought the franchise to the
United States, did you think there would be
this enormous growth?
Liam: Yes. I can say that now, cant I? [Laughter] We always knew it was going to grow
because we could just see the trends. It
had already started in Australia and New
Zealand. Then we thought My gosh, weve
got to get to the United States.The love affair that you guys have here with your pets
is just so dominant. Theres so much room
for growth. It really excites us.
If you look at the trends where people are
spending their money today, people are
spending more on the pet industry than
on the music industry, going to the movies
and video games combined. In addition,
more and more people are getting more
and more pets and the industry is just go-

ing to keep on growing.


BOJ: What are your objectives and goals for
Bark Busters going forward?
Liam: We want to continue riding this wave
of helping people learn to communicate
with their dogs. In addition, we want to
make sure that our growth is sustainable.
We want to support our existing franchise
owners. We put systems and staff in place
so that we can support those franchises. We
want them to be successful. Its important
to have growth but its just as important if
not more important to have sustainability
in the model. Thats one thing were really
focusing on for 09.
Joan: The proof of that has been demonstrated by the awards we have received.
Franchise Business Review has always ranked
us in the top 50 franchises in terms of
franchise owners satisfaction. Same with
other third-party surveying that look at the
franchisees of the company. This has been
a key to our growth. | BOJ

(Below) Ad for Bark Busters Training Show.

New Dog Behavior and Training Show


Thursdays at 8pm Eastern, 5pm Pacific

A Dogs Life
hosted by Greg Kleva
Bark Busters Dog Behavioral Therapist & Master Trainer

BOJ: What is behind the growth that you


have had in the last few years?
Liam: Were only on this earth once and I
think its important that we do what we
enjoy in life. We get paid to do what we
enjoy, and its really hard to beat that. I think
in years gone by people didnt realize that
theres such a demand for professional dog
training services. Once that door has been
opened, it has really opened the floodgates
for people who want to give back to their
communities and get paid for it.
Joan: Weve also seen a lot of candidates
come out and become Bark Busters because theyve had their dog trained by a
Bark Buster. After having the lessons they
were so blown away by it they just wanted
to join. Ours is really a pack mentality and
the pack continues to grow. So a lot of our
Business Opportunities Journal

12

Greg Kleva, dog behavioral therapist and master trainer with Bark Busters,
the worlds largest home dog training company, will host A Dogs Life on
Martha Stewart Living Radio Sirius Channel 112. Greg will help owners
understand their dogs thinking, reduce problem behaviors and improve their
relationship. Many people go through their lives tolerating their dog's bad
behavior and never getting to the point where they have the emotional bond

margins were incredible as well I mean


the profit margins. I realized once you got
to a certain volume the profit margin was
incredible.
BOJ: What was your background before
doing this?
Matt: I had a degree in marketing and just
loved the psychology of marketing. I had
been in a number of sales jobs and I had
started about a dozen businesses, many
of them the cool, impressive, sexy if you
will, internet type businesses from the
late 90s. I got caught up in that as many
entrepreneurs did, but fell flat on my
face time and time again, and each time
learned from it and got up and did better.
Matt Red Boswell, Pet Butler CEO.

Pet Butler
Pet Waste Removal
A Recurring Revenue Model

et Butler serves busy people, cleaning


up after their beloved pets. Serving
residential, as well as commercial clients,
Pet Butler is rapidly becoming a household
name synonymous with pet waste removal.
I recently interviewed Chief Excrement
Officer, Matt Red Boswell, to discuss the
history of the business, the model, and his
franchising philosophy. -- Mark Adkins

BOJ: How did Pet Butler start?


Matt: I had started Pet Butler in 1998 and
in about 5 years built it up to two-thirds
million gross billable dollars in the Dallas area. I realized I hadnt even scratched
the surface of potential. So I looked at the
various options for expansion, whether
it be franchising, licensing, or expanding corporately. I realized that, without a
doubt, franchising was the way I wanted
to go. Its not that its a more profitable
way to grow my business, but rather its
a way I could help other people achieve
their dreams. Just from a life fulfillment
perspective - I find real fulfillment in helping other people achieve their dreams.
Its my passion.
BOJ: So tell me how you got started in

1998? Not everyone dreams of going into


the pet poop scooping business you
didnt always plan to be Chief Excrement
Officer, did you?
Matt: It was not something in a million
years I would have imagined myself doing.
I heard about the concept and thought
it was a ridiculous idea. But when I was
challenged by some friends to stop and
look at it from a business standpoint and
take the pride, my personal pride, out of
the equation, it just seemed like the most
ingenious concept. Our society is busier
than ever, pet ownership is at an all time
high, yards are smaller than ever, the environmental aspects of pet waste is more
known than ever, the negative aspects if
you will, and the home services industry
is exploding. Then you have the secure
cash flow of the opportunity, meaning
its not a one time service but rather a
secure ongoing subscription service that
never ends. That just really attracts me
the security of the cash flow. As I started
running the numbers I realized that if you
could provide good quality service at an
affordable price, the skys the limit on the
amount of money you could make. The
13

With this business, the first two years I


really still thought I was going to be an
internet millionaire. This was just a fun
thing on the side that I could say I did. But
as those internet businesses failed, and
failed, and failed, and Pet Butler over here
on the side just kept trucking along low
overhead, low maintenance, high profit
margins, suddenly I kind of got, you know,
the proverbial whack in the head. A light
bulb went off and I said why do I keep
chasing this internet dream when Ive got
this thriving business over on the side
that I cant kill if I wanted to! Thats when
I spent really about three years growing
it and building it up to over $600,000. I
worked for over two years studying, learning, realizing the franchising opportunity.
Testing our model, I had two people on
both coasts testing our systems and so
then in the last quarter of 05 we began
offering the franchising opportunity.
BOJ: And from 2005 to present, you have
successfully grown the business as a franchise concept?
Matt: Its grown significantly faster than
expected. Its been a real blessing. I knew
the opportunity, I knew what we had
our hands on, but I didnt know if I could
communicate that clearly so that they
really understand the opportunity like
I did. And its been a blessing that they
have. Also, I have been very pleased with
the caliber of individual that has come on
board with us. You never know what kind
of folks you will attract when you have an
odd, ground floor opportunity like this,
Business Opportunities Journal

SPECIAL REPORT | PET RELATED OPPORTUNITIES


and so the biggest blessing weve had is
the people that have come on board, the
true business professionals that understand and see the vision of where we can
be.
BOJ: You say on the website that you service 1600 towns nationwide, how many
franchise locations are there?
Matt: In less than three years, we have
launched 132 franchises, in 27 states.
BOJ: Is that something that is a curve, is it
continuing to pick up steam?
Matt: You know it has been very consistent, from almost day one it has been
very consistent. We launched about four
a month, three or four a month, for 30
plus months, then the economy hasnt
really significantly hurt us from an enduser, client standpoint. What did have a
huge impact on our franchise numbers
was that banks stopped lending. So the
banks lending has had a negative impact
on people being able to buy a franchise
just because the two most popular ways
they were getting funding was through
their home equity loans and through
retirement, leveraging their retirement

accounts. Both of those have you know


been very negatively impacted. But from
the franchises standpoint, the business
has continued to grow regardless of what
the media says on the economy, we continue to have customers.
BOJ: I have been hearing a lot of talk that
the pet related services are somewhat recession resistant. Do you feel that thats
true?
Matt: Well we continue to see increasing
store sales and we continue to see increases despite what the media may say.
Were not so much a pet service as we are
a home service that is related to pets so
youre referring to the pet industry continuing to be unaffected by negatives in
the economy while a lot of home services
are negatively impacted so why were not
so negatively impacted is because our
number one demographic, above and
beyond everything else that influences
people to hire a Pet Butler is the word,
one simple word, busy. People are busier
than ever and when the economy gets
bad, they get even busier than ever because many times they will have to go get
a second job or the spouse will have to go

get a job, and so the busier the people


get, the better it affects our service.
BOJ: What exactly is the service? And is
it profitable?
Matt: People are just fascinated and
its kind of the only-in-America idea of
Wow, anythings possible. The service
is very simple. We dont incorporate any
crazy technology to scoop the poop. We
dont look like a big Ghost Buster popping out of a van or something with all of
this equipment. The service itself is very
simple. We simply take away the worst
hassle of pet ownership, which is cleaning up the disgusting stuff in your yard.
Every 70 plus million dogs out there in
the United States, every one of them
goes to the rest room every day, often
times three and four times a day and no
one in the country, that 100 million owners, or whatever the number is now, none
of them like cleaning up after it, so it goes
back to the age old adage, find a need
and meet it, something no one likes to
do and do it, and do a lot of it for a reasonable fee. Weve incorporated very high
tech business management software
that weve built proprietary from scratch
over half a million dollars invested in this
software that helps the franchises manage and route. We actually sign up every
customer, they call us directly through
a national call center 1-800-PET-BUTLER
and we put them on the correct route, on
the correct day, and the correct technician route with the correct order the correct franchise and it builds up for them
and tracks every service, times every service, so it just does an infinite amount of
things for the franchisee.
People are so busy, we see less than five
percent of our clients. Its very rare that
someone sees us, maybe two yards a day
that we actually see an individual. Its
subscription. Less than two percent of
our business is a one time spring cleanup. Very subscription focused. In fact, 25
percent of our business is twice a week.
You get somebody paying you I dont
care how much it is twice a week forever, thats a lot of money.
I recently sold the business here in DallasFort Worth for $1.2 million. It does well
over a million dollars a year. And what

Business Opportunities Journal

14

are the costs? He has employees, and he


has 6 Pet Butler technicians in the field.
Lets say he does $1.2 million, which is
probably close to accurate, divided by
6 technicians actually doing the work,
that is $200,000 per year each technician
brings in for him. Well, you can be certain
they dont make $200,000. Most of my
technicians actually do have a college degree so theyre attracted to the idea that
they dont have a boss that micromanages them all day. They dont have to sit in
this stale cubicle, they have some control
over their own pay, they can work at their
own pace, they can enjoy the outdoors,
they can play with dogs, they really dont
get dirty. We have tools they use to clean
up. Its a job that many white collar individuals have been really attracted to.
BOJ: Tell me about the appeal to franchisees?
Matt: The number one thing that attracts
franchisees to our model, believe it or
not, is not that its ground floor, although
thats probably third most important, it
is not only that we have a national call
center, but that we do all the billing and
collections. So the combination of the
call center that handles every call forever, our billing and collections handles
all accounts receivable forever, and our
software that handles the managing of
the business, means that the franchisee is
free to do two simple things: invest their
time and money in marketing, and scoop
the poop, or hire somebody to scoop the
poop. So, if they can do those two very
simple things, they can run their business
from any beach in the world.
BOJ: What training do you provide?
Matt: Its called Poop University or PU
for short. Its five days of in depth training
at our national headquarters Poop Central Command in Dallas, Texas. A third of
it is our software technology, a third of it
is marketing related, and then a third of
it is the rest of the business: managing it,
understanding how things work. Its very
in-depth training. And of course, you
get the software. The number one thing
people get is our people, the Pet Butler
franchisees already out there in the field
thats priceless.

BOJ: Take me through a typical life in the


day of a franchisee.

BOJ: Is there an ideal franchise candidate


out there or do you see all types?

Matt: On our website, on the franchise


tour, or I think on the franchise homepage, there is a day in the life of a Pet Butler.
Most franchise owners are owner-operators, so they literally are out there doing
the dirty work. If they are an owner operator, and they dont have any employees,
they are still fairly new, they can just jump
in their uniform and take off because our
software is also mobile so from any handheld phone, any internet enabled phone,
they can see every yard, every detail of
every yard, all the additional services for
every yard, in the optimized order using
Microsoft MapPoint our software is incorporated with and it times them between
yards, it times them in the yard, the second that the yard is completed it puts
the tracking in our software, and our customer service reps at Poop Central Command know when it was done and how it
was done and if a customer calls and has
a question it just tracks everything you
could ever ask for regarding the work.
They simply go out there and scoop some
poop and do some marketing activities.
Scooping and marketing.

Matt: Weve seen all types, all aspects of


life. Our most popular age range is the 30
somethings, those folks who have ambition, are ambitious, and have been in the
corporate world just long enough to realize two things: that theyre never going
to get their golden dreams in the corporate job and theyve had enough time to
save up some money to do something
else. And thats about half our franchise
partners are in the mid to late thirties. The
rest are all over the map. We have two
franchise partners in their early seventies,
and then we have several that are in their
early twenties. So all over the map.

By the way, we do quite a bit of commercial business too, its not just residential.
We have hundreds of apartments and
multifamily communities around the
country that we service, whether it be the
pet stations or the actual service of cleaning up their properties.

Matt: Number one is to become a household name synonymous with the industry. By far the number one thing we are
all shooting towards is becoming that
household name that is the name of the
industry. Like the Kleenex, the Chapstick,
the Xerox of the industry. Beyond that, six
months before we launched our first franchise, back in 05 I set five goals and we
are exceeding every one of them so far.
They were to have a hundred franchises in
five years. Weve already surpassed that.
To operate in all of the 50 largest metro
markets. We are well on our way to that.
I think we are in 32 of the top 50 metro
markets right now. To offer service to 50
million people thats not provide, but
thats offer service to 50 million people.
To collect half a million dollars per week
for our franchisees. So basically do $26
million in five years. These were five year
goals. And then collectively to donate
$100,000 per year to family friendly organizations and another $100,000 a year to
pet friendly organizations. | BOJ

BOJ: So the marketing is done locally. Do


you do national marketing as well?
Matt: Absolutely. We have a national
marketing and PR fund which is two percent of the franchisees gross and thats
out there doing a good amount and its
now over six figures a year. The national
marketing that we do for the franchisees
in a few years it will be seven figures and
it will really have a big impact, but right
now its primarily we coach them, we train
them, we have national buying cooperatives, buying programs that allow them
to save money, save hassle and not waste
time on things that dont work. Ultimately, it is up to them to get out there and
make the noise.
15

BOJ: You talked about there being a two


percent co-op fee. How about the franchisee royalty?
Matt: The franchise fee is $29,900. The
royalty is seven percent. The national ad
fund is two percent. We have a customer
service center fee that goes to handle all
the routing and phone calls and billing,
collections, theyre miscellaneous really. .
BOJ: What are your goals and aspirations
for the business over the next few years?

Business Opportunities Journal

pet day care


Central Bark Doggy Day Care
S

peaking with successful businesspeople in the pet


related fields, one is quickly struck by a common
theme: passion about pets. Obviously, they must get
the business-side right. But it is the passion for pets that I
find interesting. I recently interviewed Central Bark Doggy Day Care Cofounder, Jackie Jordan. She had a lot to
say about passion for dogs, as well as about the growth
of the business. -- Mark Adkins

BOJ: How did Central Bark Doggy Day Care come about
as a company and then as a franchise?
Jackie: I have been running my doggy day care locations for almost 13 years. I started with one facility back
in January of 1997 in blue-collar Milwaukee, Wisconsin,
when no one had ever heard of doggy day care yet and
everyone said it couldnt be done. It was a challenge to
get people not to laugh at me! Eventually, I was able to
get a home equity line of credit to start my business.
I opened my second location within the next 2 and a
half years. I opened my third within 2 years after that.
Its done nothing but grow.
In the process I always thought of the idea of franchising but wasnt sure if thats the route I wanted to go. I
had a friend who was in the MBA program at the Uni Business Opportunities Journal

16

Jackie Jordan and dogs.

versity of Chicago and he did a venture capital challenge class which was a competition. You come up
with an idea, a business plan, a new one or existing one
you want to take to a larger scale. So he said Well lets
do doggy day care, and I said OK, fine Ill help you.
So in a world of high end technical, medical, computer
and all that kind of stuff, we were presenting doggy
day care. Everybody thought it was funny and cute but
we kept making the different levels of the competition.
We kept getting approved and getting approved and
passing to the next level. So finally were in the finals
of this competition, and we presented to a room full
of venture capitalists. They really liked the concept but
they didnt feel it was a VC type of opportunity but was
more of a franchise model. They wanted to acknowledge the plan so we won a fourth place acknowledgement. They really only had first through third but they
created fourth because they liked the idea so much!
BOJ: Did you just continue to grow the business organically?
Jackie: Organically. We decided that it was something
where we could get investors but we wanted to try doing it on our own. We didnt want to give up any kind of

of shares or any control of our business


and our concept and our dreams. So we
have done it organically. Weve invested
in ourselves.
BOJ: Did you have an interest in pets or
dogs in particular before this?
Jackie: Oh yeah. I grew up with pets. I was
awarded a lifetime membership of the
Tri-County Humane Society in the sixth
grade for my volunteer work. Ive just
always, always been involved with pets
and I do have an undergrad in veterinary
technology that I would never use working per se as a vet tech but I do use my
knowledge daily in my business and just
with my own pets. I own three dogs now,
or I should say they own me, and a cat. We
are very passionate about our pets.
BOJ: So when did you start the franchising?
Jackie: About 4 years ago.
BOJ: Where is the company now in terms
of franchise locations?
Jackie: Well were 32 sold; were in 8 states.
All of our stores are open now, except for
5. We were very committed to maintain
at least a 50% open-to-sold ratio because
we just felt that it was very important not
to just be a selling machine, but to actually open our stores and help them in the
process. Its one thing to sell franchises
and another, especially in our industry,
to open them. You know, because of
zoning and were not doing widgets, we
typically have to have special use permits.
Its a process, its not like we can just pick
any type of building we want and go in.
Theres neighbors and theres landlords.
Theres the health department. Its quite
a process so weve really honed our skills
on what to look for and where to be, and
whats going to work for us as well as
whats going to work in the community.
So were really proud of the fact that in
the past year we have opened 14 stores,
since 2007.
BOJ: How would you describe the business model of Central Bark Doggy Day
Care?
Jackie: There is not another model out
there like us. Others are more of a glorified kennel that offers a Day Care. Were

really truly a Day Care. We offer 5 core services, but our bread and butter is the dog
Day Care. Id say 65-70% of our revenue is
on Day Care, then the rest is icing on the
cake. We also offer sleep overs. We dont
call it boarding. We dont call it kenneling.
Its sleep overs because your dog has to
be part of our Day Care program in order
for them to sleep over. So its very different. There are a lot of glorified kennels out
there that will try to have the Day Care
component to it, but we are truly the Day
Care model. The reason why we choose
to do that is because its whats best for
the dog. Anytime you have dog-to-dog
interaction there are potential problems.
If youre not putting the right dogs with
the right dogs. People can not get along
and argue, but the way dogs argue, its
with their teeth, so we want to make
sure that were screening the dogs really
well, that were putting the dogs with the
right playmates and making sure that
were creating the safest, healthiest, most
nurturing environment that we can for
the dogs. Were
about the dogs,
so the dogs
have to come
a minimum of
once a week in
our
program.
We dont take
the Gee, its
convenient for
me to get the
dog out of the
house because
the cleaners are
coming today
kind of customers. Were committed, and our
customers are
committed to
whats best for
the dogs. And
its a consistent
program. The
dog comes consistently, most
of our customers use us a
couple of times
a week, with a
17

minimum of once a week. The dog knows


the environment, the dog knows the
staff, the dog knows the routine, the dog
knows its playgroup.
BOJ: Is this what attracts customers to
you?
Jackie: I think so, and thats something
that we have to screen out with the
franchisees. Are you in this because you
want to make a quick buck? Or are you in
it because you have a passion for it and
you want whats best for the dogs? Well
screen out franchisees that way and well
screen out customers at the store level.
You know, if youre not committed to
coming once a week then this isnt the
program for you.
BOJ: What is the ideal franchisee for the
business?
Jackie: The ideal franchisee is somebody
who wants whats best for the dog and
who has a passion for dogs. You can like
Central Bark Doggy Day Care staff and friends.

Business Opportunities Journal

SPECIAL REPORT | PET RELATED OPPORTUNITIES


dogs, but to be fully ingrained in them
24/7 basically, I mean youre constantly
with them and youve got to love what
youre doing. It would be like somebody
who doesnt really like kids being a day
care provider. It just wouldnt work. That
would not be fun for either the child or
the provider. You have to really love what
you do. We look for people who want to
give back to the community and to local
rescue shelters and humane society type
organizations because thats a big part of
who we are and what we do.
We raise money for our Dog Bless America Program. It has taken a number of
different routes throughout the years.
Right now what were working with is the
Prison Dog Program so we raise money
to provide dogs to the prisons that in
turn train the dogs as service dogs for
veterans who are coming back from
fighting in wars. Its a win-win. Ive picked
up dogs that have been trained by the
prisoners, Ive dropped dogs off to prisoners. Ive talked with these people and
they say this is the best thing thats ever
happened. One quote from one prisoner
out East said I cant take back what I did
yesterday but I can make a difference for
what I do tomorrow. That just was really
insightful to me because hes in for life for
murder, yet hes doing something good.
He trained a dog that we then transported out to somebody in California who
needed a service dog. Its just absolutely
amazing. Thats something that were really proud of with our organizations that
our franchisees help to support that as
well as locally.
BOJ: Is this something that anyone from
any walk of life can succeed in if they
have the right passion?
Jackie: We have accountants, insurance
backgrounds, airline pilots, flight attendants, computer backgrounds. Weve got
franchisees from a variety of backgrounds
that just decided they were successful
in their professional career and decided
You know what? I want to work for myself, I want to do this, I want to be with my
dogs. Wed prefer to have someone with
some business background, some business management background, because
you have to have some basic knowledge
Business Opportunities Journal

on how to run a business. But we also


help with that as well. We give them a
lot of training in dog behavior and dog
training and even first aid and things like
that for the dogs. But they still have to
come with a basic understanding of dog
behavior and be able to manage a pack
of dogs.
BOJ: Do you have a formal training program for new franchisees?
Jackie: Yes, three weeks. Two weeks are
at our corporate headquarters, and one
week were on-site with them.
BOJ: What is it about Central Bark Doggy
Day Care, if you can put your finger on
it, that would make potential franchisees
want to consider it?
Jackie: I think its a couple of things that
weve heard from in the sales process
when franchisees come to our Discovery
Days. We encourage them to go check
out other business, other dog care or
pet related businesses because we really
want to make sure that this is a model
that works for you. We are in partnership for the next 10+ years and we want
to make sure its right, that its a good fit
for you and a good fit for us. So we really
encourage them to check them out and
when they come back to us, the biggest
thing that we hear is the passion. You
know, this place was all about selling,
or this place I didnt get warm and fuzzy
about. We really are a different group.
Somebody came to us and said We want
to buy a master franchise agreement.
Were not about that. The biggest thing
that I found as an individual store owner
is that people are giving you their kids,
they want you to care for their kids, their
four-legged kids, and they want to know
whos behind that counter taking care of
their kids. So if youve got this big investor whos opening up all these different
stores and theres not really a personality
behind it, I think its a detriment to our
business model, so were really about
the people who are caring for the pets.
Thats a big difference between our franchisees and franchisees that go into a different kind of franchise system.
BOJ: Do you have an advertising and
marketing cooperative program for the
individual franchisees?
18

Jackie: Yes, they pay in two percent of


their gross revenue for the national marketing fund. So we produce ads and materials for them to use at the store level.
We use that to continue our website. We
do a bimonthly newsletter for the stores.
Were not doing radio and TV ads necessarily. Were still very young so that fund
is minimal. In the metro Milwaukee market, weve got 14 stores so we encourage them locally to join together and do
things that way.
BOJ: How have current economic conditions affected individual locations and
the franchise as a whole?
Jackie: Well time is taking its toll. People are nervous. At the store level, our
stores that are a little bit more mature,
they seem to be doing fine. For the most
part, theyre not taking a big hit. Some
customers lose their jobs, some are cutting back. Instead of two times a week,
theyre cutting back to one. But were still
getting new customers in the door. So I
cant say that its made a significant impact on those stores. The newer stores,
the growth is a little bit slower than what
we were experiencing, but theyre still
growing. So well see. I wish I had that
crystal ball.
BOJ: Some say that pets might be more
recession resistant, because in times of
trouble, people need more emotional
support, more companionship. Do you
think theres some truth to that?
Jackie: Absolutely. Over the 13 years that
Ive been doing this, I think about what
kind of economy weve had. Its been
good and its been bad. We went through
9/11 and that was a tough time too for
our country and we continued to grow
during that time, so I think that theres
some truth in that, that people are going
to not cut back or not stop providing for
those that they love. And well, their pets
are who they love. That is their baby. So
they might financially be forced to cut
back a little bit. People who have had to
drop out on those rare occasions were
like Ill be back when I get my job back
or I have to but I dont want to. Its very
emotional for them. | BOJ

SPECIAL REPORT | PET RELATED OPPORTUNITIES


ing the animal care industry has been an
intricate part from the beginning, so the
equipment that weve been building has
been appropriate for both audiences,
meaning the human side as well as the
animal side. It has only been within the
last five years that we have been studying
quite intensely the opportunity in developing this model as a pet memorialization
positioning.
BOJ: What is behind this shift toward pet
memorialization?

Steve: Matthews Cremation is one of six


divisions of Matthews International, a
publicly held company, and is the largest
manufacturer of crematory equipment
for the human and animal audience.
Matthews International acquired the
company, previously known as Industrial
Equipment Engineering, or IEE, back in
the late 90s. That business was started
in 1946. So, for over 50 years weve been
building equipment.

Steve: Back in 2003-2004, we began a


very thorough consumer research study
on various components of the death
care industry. We had an independent
company come in and conduct research
for us and in the process captured over
190 hours of video footage of people
sharing their stories about not only the
experiences of going through the loss of a
family member, but equally important the
loss of a family pet, especially the process
of how they were, or were not, able to
resolve the grief of the experience. What
really hit home for us was when you are
video taping, you have people sharing
their stories about a loss, about a father,
a mother, a brother or sister, but when we
began shifting the focus from the human
loss to the pet loss, the tears just began
to flow. I had to stay out of the way and
basically sit in a room watching video
footage of this taking place, watching
people breaking down, crying because
the grief was so dynamic and the loss was
still real. They had no outlet. They had no
channels through which to get care. So
for us it clearly symbolized there was a
market opportunity. There was a service
opportunity that stands before us.

BOJ: So this is an industry that has been


around many years?

BOJ: And you developed a franchise business model out of this research?

Steve: We have customers that go back to


the start of our own business. The early
pioneers started in the 70s and 80s. They
were basically contracted by the county or
the state or the local jurisdiction to help in,
and I hate to use this word, the disposal.

Steve: No, were simply a supplier. Our


business is in the manufacturing side.
But we do an awful lot of consulting, we
do an awful lot of marketing and brand
development. We have an extensive line
of pet loss memorial products that can
be built into the retail center of the pet
funeral home, so we have all of the different aspects. Its kind of one of the more
interesting discussions when you talk

Pet Cremator - Power Pak II

Championing the Memorialization Trend

Matthews Cremation
H

ere is a unique scenario: instead of purchasing a franchise, you purchase the


equipment you need to start your business,
and the manufacturer helps you every step
of the way, assisting in the design of your
store plans, filing for permits, even providing sales collateral and a professionally
designed website. You gain many of the
benefits of a franchise, without a royalty or
national marketing fund payment.

atthews Cremation is offering this


support to its crematory equipment
customers. According to the company,
pet owners in the United States are under
served in death care services for their pets,
with too few options for pet memorialization. Matthews Cremation sees enormous
growth ahead in the field as entrepreneurs
are beginning to address this need, providing a much needed emotional outlet
for grieving pet owners. What follows is
my interview with Steve Schaal, Division
Manager, Sales & Marketing, Matthews
Cremation. --Mark Adkins

BOJ: I understand that Matthews Crema Business Opportunities Journal

tion is a leading equipment manufacturer?

But for the past four or five years, we have


been championing the development of a
pet funeral home business model. Serv20

Interview with Steve Schaal, Division Manager,Sales & Marketing, Matthews Cremation
about franchising, because we do all of it,
but we dont do franchising.
But I will share with you that there are many
that we have set up who are looking at
franchising, and are carrying a big picture
vision of what this truly could mean from
a national perspective.
BOJ: What do you see as the business
opportunity that is available for entrepreneurs in this field? Is it providing pet
memorial services from a more holistic
perspective, helping to take care of the
pet owners needs in the grieving process,
above and beyond the physical cremation
process?
Steve: What we are championing, and this
is a different model from the earlier pioneers, is were actually encouraging them
to invite families to come to their facility
and have an area laid out that not only is
professional in nature, but more importantly gives them a chance to sit down and
discuss the types of arrangements they
would like that can be as modest as the
service itself or may be a committal which
allows them a chance to have a minister
come in and provide a memorial service,
offer a variety of different products from
which to choose. From garden memorials
to burial products to scattering products,
all the things that you would find in the human side would be just as applicable to the
animal care side. Even including memorial
video tributes.
We just recently went through the loss of
a dog, our dog passed away, 11 years old,
and my children spent a few days going
through the albums, and we came up with
a collage of pictures that we put to a video
tribute for our dog Samantha. You know,
my children are older, but its funny, the
tribute they have is located on their Facebook page. My one son is 63, 220 and he
cant even talk about Samantha without
choking up with this video that he helped
create with us. Its been a wonderful relief
for him to occasionally be reminded, to
be able to turn it on and to work through
the celebration, as we like to call it, of

companionship.
BOJ: So it is a major shift toward serving the
pet owners grief, not simply providing the
cremation services?
Steve: There are many people carrying this
profound loss, and still hiding for fear of being minimized, the pain being minimized,
and there are many of those who until
you talk about it, until you identify it, until
you build the community network, the
awareness of it, theres a lot of them out
there that are simply just going through
the process and can not talk about it. And
this could be a death of a pet that could
have passed away years ago that theyre
still harboring inside. What were doing, the
movement that is happening, and believe
me, its being driven by the consumer, the
consumer is driving this direction, not
us, were simply recognizing the calling
and making it an opportunity across the
country. The fact is that theyre looking for
something that is appropriate and meaningful for them and the definition of that
can be anything. It could be someone that
says you know what, I really dont want
my pet back, go ahead and do whatever
you do, and they simply let the pet go. Or,
like we did, they say No, I want Samantha
returned, I want her back, I want to pick
out what were going to do, I want to pick
the right garden material, I want to pick
the right cemetery ground, I want to pick
what we believe is most appropriate for us.
BOJ: Are the services provided in the industry fairly uniform?
Steve: There are two types of services
that you will find when you are networking with these facilities and that is either
what is called a communal service or a
private service. You can imagine that the
communal service is nothing more than
a cremation taking place with a certain
quantity of pets, all being done at the same
time. The private cremation services are
obviously one pet only, one container at
a time being cremated so that way those
cremated remains are not comingled or
confused with any other pets. They are
21

distinguishably yours so that this way they


can be returned directly back to its owner.
What we see is that for the early pioneers,
for the ones that first got into this business, almost 90% or better of the services
they provided were in the community
type relationship. People were just asking
for their pets to be cremated without an
awareness or understanding. What were
discovering is that now that percentage is
more like 65% are private, and the smaller
percentage is communal.
BOJ: And consumers are willing to spend
more for these enhanced services?
Steve: The real revenue dollars are in the
pet loss memorial care. Once you build
the educational awareness for consumers, whether its at the veterinarians office
or the humane societies or at the funeral
homes, wherever the audience, wherever
the contact is made, once you describe the
difference, the last thing they are going to
do is have that pet be placed with a group
of others and scattered in their field. More
appropriately, they would be returned to
them so that they can decide how they
wish to memorialize. So what we see, or
what weve learned over the last several
years, is that people can distinguish the
difference. If you are looking at your community and see that there are providers
and think I cant possibly do this in my
community because XYZ business is down
the road handling it. Please dont be confused about those who do mass incinerations and those who are building a funeral
model for pets. As the profit number, the
revenue driven number is a distinctly different because youre building the model
based on cremation rates per pound versus
a cremation rate per service and the dollar
variant is substantial.
Weve learned that when a family is making arrangements for their pet and theyre
advised what the cost is, the odds of debating or negotiating is absolutely minimal,
in contrast to other services where you almost anticipate a reaction or a negotiation
or can I cut this out, or can I remove this.
Its amazing when it comes to the services
for pets, how the wallet is wide open.
BOJ: What are the components, as well
as equipment, needed to provide this
Business Opportunities Journal

SPECIAL REPORT | PET RELATED OPPORTUNITIES


service?
Steve: First of all, you would have to decide
on a piece of equipment that would be
rated by its production speed. What I mean
by that is that the equipment is designed
to do a certain amount per hour. Lets just
say in this particular instance, pounds per
hours. Typically an entry level piece of
equipment runs about 75 pounds per hour
and has the capacity to hold somewhere
in the range of 300 pounds. Now thats
just cremation equipment itself. You also
should be aware, and most people dont
know this, that cremation does not dissolve
the bones. Cremation develops the ash
and bone fragments, but those still need
to be processed. What that means is that
they have to be processed to a fine powder
and that would be done by a machine that
you would transfer the bones from the
equipment, the crematory equipment to
a processing machine that actually is an
industrial type blender that cremates the
ashes and bone fragments to a powdery
substance which is what is transferred to
an urn. So you need a piece of equipment
and you need a processor to be able to
conduct the service. Certainly because of
the volume, its wise to have refrigeration,
whether its a refrigeration cooler or a
freezer. Its important to have something
to hold while you are conducting your day
to day business. Since most veterinary clinics have similar type equipment, normally
when you are out making your removals
during the day and youre bringing them
back to your place of business, that needs
to be staged. Its not only for the dignity
and the handling of the pet, but also for
the protection of the operator.
BOJ: What are the basic steps a new business owner needs to go through to get
started?
Steve: First of all, they have to find a location that will allow them the proper zoning
in which to invest in equipment because
of the crematory equipment. A lot of
them are in residential communities, but
its important that they identify the appropriate approval process. The first thing
that youre going to have to understand
in your review of commercial real estate is
that you have to be able to obviously get
Business Opportunities Journal

the permission to install equipment. For


most of the clients that we work with today,
because we work with a couple hundred a
year in the business development side, its
the fact that they probably are looking at
industrial areas for this initial model. But I
caution anyone that is looking at that as
a possibility is although there might be a
lower threshold to get permission to install
equipment in an industrial area, if you are
trying to build a true funeral model for the
animal care industry, it has to be a place
that people will feel comfortable going to.
So if you have to lock the doors and chain
the windows after 5 oclock in the evening, I
would probably suggest that you would be
nothing more than a back door provider.
What I mean by that is that the services will
be rendered through the community but
it wont be your face as a part of it because
you are nothing more than going in the
back door of a veterinarian office, handling
the cremations and giving them back to
the veterinarian and the face of the business represents the veterinarian, which is
totally fine. There are a lot of successful
operations that are doing it, but the challenge that you have with that model is the
fact that veterinarians are not interested
in memorial care services taking place at
their place of business. You are not going
to have a committal area where the pet will
be laid out and the preacher will come in
and your family and friends will walk in and
youll have a moment of silence and the
ability to say goodbye, or video that might
be running in the background that sort of
tells the entire story. You know, the same
experiences you have today at a funeral
home where you go and you express grief
and you take comfort. It is important for
you to have that somewhere in mind in
the idea of where the real estate is located.
BOJ: Is networking with veterinarians
and others important to the model you
propose?
Steve: Well, certainly the business that we
see available is one we see as a network
that allows us the ability to identify those
who we would say first of call. In the
animal care industry, obviously first to
call would be your veterinarian network.
If they are adamantly against the thought
of handling these services internally, then
22

this is a network for us to be able to build


this service as an extension of service. That
still rings true in regards to the funeral side.
If you have a funeral network in the area
that is not interested in handling the service but certainly wanting to be an outlet
for families who need that support, there
is an opportunity to be an extension of
service for them as well. So literally you are
building yourself a business model which
has positioned itself within a network of
veterinary clinics, groomers, humane societies, kennels, you name it. Anyone and
everyone that is affiliated to the animal
care network.
BOJ: You talk about championing the shift
toward pet memorialization. How does
Matthews Cremation help go about that?
Steve: Well, for example, we recently hosted a six city business development conference. We had one in San Francisco, one
in Phoenix, in Texas, Florida, Ohio and in
Massachusetts. The last one we completed
was in August, and we spent a couple of
months sort of digesting the material and
digesting the reaction. We had over 500
guests attend the conference, so we had
a great turnout. Ive been getting a lot of
calls since the last one simply asking when
will we host another one. We are considering conducting another series throughout
the country. Wed like to continue bringing people who have gone through the
experience and have built the business
model who can share their scars or all the
different things that theyve gone through
so that this way anyone that comes to the
conference is given an armful of ammunition with which to go back to their market
and begin building the business model.
We have built an arsenal of collateral materials that can be placed at all the neighboring veterinary clinics that, if you know
that a veterinarian doesnt want to speak of
death because that may symbolize failure,
can be placed that are nothing more than
educational pieces so that at the time of
loss, it gives people comfort in knowing
that there is a place to go to.
We have built a free standing pet loss website called Faithful Forever Pets at www.
faithfulforeverpets.com. That actually
shows a lot of illustrations. Its basically a

piece that we include with equipment because when people look to buy equipment,
especially early entrepreneurs, there are
two things we try to provide. Number one,
we have a great finance network to help
people starting their business. Number
two, we love to give you all of the collateral
pieces at a modest cost, because we know
that advertising and brand developing
and all of the awareness components that
have to be a part of the equation can cost
a substantial amount of money. So what
we have done is we have built a boiler
plate for anyone wanting to get in that
can give you these tools that can literally
be branded. You can leave them as Faithful
Forever, which is our template, or you can
literally have it transferred as something
of your own. All of the pieces look and feel
exactly as you.

ally getting started?

BOJ: What is the time line from someone


getting interested in the business, to actu-

BOJ: What would you estimate the range


of start up costs are to enter this business?

IVISION

TION D
CREMA

Steve: Its kind of tough to quantify this


because as you can imagine, the fuse is
rather long. The first thing is that they
need to understand the working capital
to make it successful, and then they need
to begin identifying a location. Once they
get their location identified, then the zoning component comes in place, and then
we file on behalf of the client all of the
permitting components, meaning, pretty
typically you have to file an air permit. Its
usually nothing more than formalities.
Were guaranteed in all 50 states. Our
engineers do that. We do a lot of layout
drawings. Literally we give all of the support within the framework of the company.
These arent add-on costs. Were doing all
we can to guarantee their success.

Matthews CreMation

stiMulus PaCkage

And BAycAp, Inc FInAnce Is reAdy to Lend.

pet equipment
power pak Jr.

75 lbs. per /hr. Cremation rate


300 lbs. Safe Load Capacity
Smoke-Buster 85
Fastest Selling pet Cremator
in the industry.

815

Steve: The real estate is a major variable


number because thats a tough number
to kind of get your hands around because
of the market variances. Typically in equipment, you could probably start at an entry
level that would get you in the business for
about $50,000 up to $100,000. You need a
vehicle. Plus you need plenty of working
capital. You know, prepare yourself for the
haul. Most businesses we see somewhere
in the range of about $250,000 to $300,000
for start up needs. But to get into your
equipment and the development side, the
gradual side of that equation, it can be as
low as a $50,000 investment. | BOJ

Online at www.matthewscremation.com
Email: sschaal@matw.com

For over 50 years, Matthews


Cremation has been helping Veterinary
professionals offer total life cycle pet
care through the investment in
crematory equipment.
We are witnessing one of the fastest,
untapped service trends within the
pet care industry pet loss memorial
services. Discover the amazing service
and revenue opportunities by contacting
one of our equipment consultants
at (800)-327-2831 or visit us at
www.matthewscremation.com.

CREMATION DIVISION

$
**Based on $55,000 budget, 84 month term, 20% PRO
Lease, first & last payments in advance plus processing
fee, requires financial statements, on approved credit.

A Month**
23

EQUIPMENT
SERVICE & SUPPLIES

E m b r a c E

t h E

o p p o r t u n i t y

Business Opportunities Journal

guestexpert>>
Economic Outlook
Pet Care Services Association
This past month, the Pet Care Services Association performed an informal poll to ask members the following question: How much is business
down (in revenue) this year? Of the
2,400 members asked to complete
the survey electronically, 246 members answered, or
more than
10% of
those
it was
sent
t o

and is significantly significant. Although the


survey was unscientific, it does shed light
on how the pet care industry is fairing.
The results were extremely interesting:


51% of those responding said
their revenue increased in 2008.

15% of those responding said
revenue was down 16% or more.

34% responded that revenues
had decreased between 0-15%.
However, the story is not in the numbers, it is in the details. After speaking
with a number of facility
owners to discuss the results, there were many
sides to what has happened with regard to
2008 revenues and
how timing has affected their ability to create
positive business conditions.
Wendy Oleksiak, R.N. of Cohasset and Duxbury Kennels located in Cohasset
and Duxbury, Massachusetts, respectively,
says that early
gains
she
saw at the
beginning
of the year
are just now
being
diminished by
the economic
downturn that
has affected the

Business Opportunities Journal

24

fourth quarter
of 2008. She
says, While we
saw
revenue
growth in 2008
as
compared
with 2007, I
believe we are
now starting to
feel the impact Joseph Lyman, CEO PCSA
of the economic
recession in our area. The Thanksgiving season was up slightly in 2008
as compared with the same period
in 2007 (approximately 3% growth).
However, we saw a 25% decrease in
revenue during Christmas 2008. Our
next big focus is February vacation
and the winter ski season. These will
be good indicators for the balance
of 2009 and will help us understand
what we need to do to ensure a profitable year.
Others such as Nicole MacDuff of
Manoir Kanisha located in Montreal,
Quebec have not been affected by
the downturn, yet. However, this is
largely due to the fact that she has
been earning business from those
that were once customers of other
pet care facilities that have since gone
out of business. Nicole says, The
economic downturn is beginning to
affect the boarding industry in the
Montreal area. We have experienced
clients losing their job, therefore canceling their vacation and pet boarding reservations. However, the closing
of four local kennels & grooming facilities in our area has resulted in their
clients coming to Manoir Kanisha.
This has resulted in many new clients
and an increase of 14.6% in 2008 fall
revenues. The long term effects are
hard to quantify. The business of Pet
Relocation is driven by slightly differ-

ent dynamics. Relocations take place


for two main reasons, moving home
or for new work appointments in other countries. One must assume that
there will also be an overall downturn
in both of these activities.
Still, there are those that have increased revenues for the entire year,
such as Charlotte Biggs, CKO of Stay
N Play Pet Ranch, Inc located in Dripping Springs, Texas. She says, We
have seen boarding stays especially
over the holidays be shortened by
days, but we filled the gaps with additional boarders and there has been
a reduction in the number of add-on
services that our clients usually order.
However, weve proactively countered
that with specialized promotions of
some of these services to gain interest and use of the services by an increased number of our clients. Weve
also had to get creative and come up
with other new, different and exciting
services to offer.
Biggs is a strong believer in making a
plan and sticking to it. Through proper
planning and sticking to sound business practices, Stay N Play Pet Ranch,
Inc has been able to continue profiting through tough times. She says,
The same good business management practices that we use during the
good times, will take us through the
tough times. The decisions we make
may be different, we may increase our
marketing and advertising to ensure
our client base doesnt drop instead
of implementing what we thought
would be a major expansion. Our creativity may have to rise to the surface
instead of us just maintaining the status quo. The one thing I do know is
that we in the pet care services business are some of the most determined

and strong-willed entrepreneurs out


there. With our passion for the pets
and our businesses, we can survive
and even prosper during these times.
Although a majority of individual pet
care facilities answering the poll have
increased revenue in 2008 as compared with 2007, it is clear that the
economic downturn will affect the
pet care industry in the coming year.
David Lummis of Packaged Facts, a
leading market research firm pet care
and product sectors, believes providing dogs and cats with the best possible pet care is an important way for
facilities to survive in 2009. He says,
In the current economy, its more
important than ever that pet industry participants of all stripes tie their
products and services directly to pet
health and position themselves on
the front line of preventive pet care,
which can be far less expensive than
the kinds of long-term health conditions that can result from, say, poor
nutrition or inadequate grooming.
Despite the state of the general economy, there are indications that the pet
care industry will be able to weather
the recent financial downturn. The
American Kennel Club recently surveyed 1,000 pet owners and many
responded that they are willing to
sacrifice many of their own personal
luxuries to provide for the needs of
their pets. More than 96% of respondents with a taste for gourmet coffee
would forego their daily caffeine habit
to provide money for their dogs expenses. Moreover, nearly 79% would
cancel a teeth whitening appointment in order to afford their dogs
teeth cleaning. Joseph Lyman, chief
executive officer of the Pet Care Services Association, believes the AKC
25

survey reinforces the idea that pets


are an integral part of families and
people are willing to make sacrifices
for family members. He says, The
pet care industrys demographic is
primarily female-based and the chief
decision maker in the family. Family
issues are important to these women
and they are willing to make the necessary sacrifices to ensure that their
pets lead a health and fulfilling life.
Although times are tight for most
extravagances, many women do not
consider their pets expenses a luxury.
Someone once said, You develop
courage by surviving difficult times
and challenging adversity. With the
pet care industry filled with creative
and progressive individuals, it reasons
that the industry will not only survive, but thrive these tough economic
times and exit it stronger and more
resilient than when it began.

About the Author:


Joseph Lyman recently assumed the position of Chief Executive Officer of the Pet
Care Services Association.
Prior to joining PCSA, he was Executive
Director of the Insulating Concrete Form
Association and was the Executive Director of the Small Firm Council of the American Council of Engineering Companies,
representing the political and business
interests of over 3,800 small engineering companies throughout the United
States.

Business Opportunities Journal

Economic Outlook

AKC Survey Finds Dog Owners


Willing to Kick Caffeine Addiction
for Canine Affection

seem to be consistent about. PetPartners, Inc., provider of the AKC Pet Healthcare Plan, says that sales rates
are holding up and owners are renewing their policies in consistently high numbers. This shows that pet
owners view pet insurance as a way to manage their
pets health care costs. Some dog owners have even
opted to purchase health plans for their dogs over

Current Economic Woes No Competition


For Americans Dedication to Their Dog
AKC SURVEY RESULTS
A survey conducted by the American Kennel Club
shows that despite a tough economy, pet owners are
willing to sacrifice many daily luxuries to provide for
the needs of their canine companions.
The survey of over 1,000 people on www.akc.org
found that more than 96% of respondents with a taste
for gourmet coffee would give up their latte habit to
save money for their dogs expenses. Ninety-seven
percent also said they would forego massages or spa
treatments in order to afford a vet bill, and nearly 79%
would cancel a teeth whitening appointment so that
Fido could have his annual teeth cleaning.
The only item that seems to compete with peoples
love for their pooches is Internet access, with more
than 70% of respondents indicating that they would
not be able to abstain from their web addiction. One
respondent would give up pretty much anything. I
need the gym and I need the Internet, everything else
is fair game.
In general people are more dedicated to their dogs
than ever before. No doubt dogs bring comfort and
stress relief to many people during this difficult time,
said AKC spokesperson, Lisa Peterson. This is reminiscent of what we saw during hurricane Katrina. With
people facing great hardship, many remained so loyal
to their pets that they were willing to risk their lives.
Our survey demonstrates that they are also willing
to forgo some of lifes luxuries for the welfare of their
pets.
The survey also found that with the holidays coming
up, most dogs can still be assured that they will find a
bone under the tree. More than 69% of respondents
would cut back on gifts for their friends or extended
family before they would skimp on holiday gifts for
their dog. Nearly 9% would even scale back on gifts
for their spouse before cutting back on presents for
their dog.
Healthcare is another area that dedicated pet owners

Business Opportunities Journal

26

themselves. One survey respondent admitted, My


Cavaliers have health insurance, however, I do not.
Holiday Gifts
81% of respondents purchase gifts for their pups
during the holidays
69% spend up to $50; 24% spend $50-100; only
3% spend more than $150
59% expect to spend the same amount on gifts
for their dog as they did last year
Giving up Like for Like
67% would cancel their travel plans if they could
not afford to pay to board their dog.
65% would regularly eat Ramen noodles before
they would skimp on their dogs high quality food.
59% would perm or color their own hair in the
kitchen sink in order to keep Fidos appointments
at the groomers.
Cutbacks Owners Are Willing to Make For Their Dog
Eat more meals at home (97%)
Cancel gym membership (72%)
Cancel cable or satellite service (50%)
Curb spending on new clothes (94%)
Push back plans for home remodeling (89%)
Forgo buying new car or buy a less expensive
model (88%)
Money Saving Techniques
52% look for sales and/or clipping coupons before shopping for pet products
48% are purchasing fewer toys/treats and other
non-essential dog supplies
34% have begun buying dog food in bulk
Explanatory Notes:
The survey was conducted on the American Kennel Club
Web site during a one-week period in Nov-Dec 2008. A total of 1,088 surveyors responded voluntarily. Self-selecting
methods were used in recruitment for this study. AKC does
not guarantee that these statistics are scalable to the overall population. This data is for anecdotal purposes only.

Pet C
a

ion
iat

ices
Serv Assoc
e
r

Ba

sic Training

to start a business in the


lucrative Industry of pet care!

OURREVIEWS

FEWOPPORTUNITIES

As a future dog daycare owner,


I thought that the PCSA Basic
Training Seminar...was valuable
and informative. I was pleased that
the presenters were people just like
me who brought forth real business
experiences. The sessions focused
on requirements for daycares and
provided numerous sources for
specific aspects within our industry.
The four day seminar gave me an
excellent opportunity to meet and
network with existing and future
owners. The atmosphere really
made me feel connected to the
PCSA community.

There are few business opportunities in life that will afford you
the freedom to do exactly what you wantfew opportunities that
will reward you financially for doing exactly what you enjoy.

- Kim Smith, D.I.G.S. Dog Daycare

I very much enjoyed the talks,


and I feel that I was given so
much information that I would
have had to spend countless,
painful hours trying to put together
myself. I enjoyed the networking
opportunities and the very open
atmosphere that everyone says
makes up PCSA. I would definitely
recommend this seminar to anyone
who would like to get into the
kennel business.
- Regina Bohannon

THEEVENT
Join us for the Pet Care Services Spring 2009 Basic
Training at Tuscany Suites and Casino in Las Vegas,
March 15 - 18, 2009.
PCSAs Basic Training is the leading provider for all the information you need to develop and grow your pet care services business.
Learn the dos and donts of pet services,
Pinpoint ways to finance your facility,
Identify a plan for establishing sound business operations,
Develop an understanding of your target market,
Gain insight into staffing your facility, and
Find out how to provide expert customer relations

For more information go to: www.petcareservices.org


or call (877) 570-7788 ext. 17

Grooming
Aussie Pet Mobile

Number: (949) 234-0680


Website: www.aussiepetmobile.com
Founded: 1996
Category: Grooming
Number of Locations: 81
Description: Aussie Pet Mobile is a mobile grooming
service providing at-home grooming services. Services
include bathing, grooming, nail clipping, brushing
teeth, undercoat removal and flea and tick control.

Hydro-Groom

Number: (336) 361 0706


Website: mobilepetwash.com
Founded: 1991; Franchised in 1998
Category: Grooming
Number of Locations: 9
Description: Hydro-Groom Mobile Pet Wash provides
mobile grooming services straight to pet owners
homes, providing a convenient service for those with
a busy schedule.

Pet Related Opportunities

Pet Training

We picked the following 15 pet related opportunities to provide an at-a-glance overview of some key categories in the
field. There are many more opportunities available, but these
caught our eye for one reason or another. Please check with
the businesses for the latest information and disclosures.

Bark Busters

Number: 877-300-BARK
Website: www.barkbusters.com
Founded: 1989
Category: Dog Training
Number of Locations: Over 320
Description: Bark Busters provides in-home training services for pets of all breeds and ages. Having
trained over 500,000 pets worldwide, Bark Busters
has been named Best of the Best by the SPCA for
their global excellence in dog behavioral training.

Contraband Detection
Interquest Detection Canines

Canine Dimensions In-home Dog Training

Number: 1-800-481-7768
Website: www.interquestfranchise.com
Founded: 1988, franchised in 1999
Category: Contraband Detection Canine Services.
Number of Locations: 40
Description: Interquest Detection Canines specialize
in detecting contraband, firearms and other illegal
items. Interquest Detection Canines are usually found
assisting local schools to detect substances that may
be harmful to the surrounding environment.

Business Opportunities Journal

Number: (888) 281-DOGS (3647)


Website: www.caninedimensions.com
Founded: 1997
Category: Dog Training
Number of Locations: 5
Description: Canine Dimensions helps teach pet owners 2-way communication techniques between the
owner and the pet.

28

TailWaggers Doggy Daycare


Number: (920) 954-1000
Website: www.tailwaggersddc.com
Founded: 2004
Category: Day Care
Number of Locations: 1
Description: TailWaggers Doggy
Daycare provides daycare, overnight
boarding and grooming services to
their clients. Dogs receive constant
supervision by pack leaders.

Central Bark Doggy Day Care

Number: 866-799-2275
Website: www.centralbarkusa.com
Founded: 1997
Category: Day Care and Boarding
Number of Locations: 32
Description: Full service facilities
for day care, boarding, supply shop,
grooming, vet care and canine cab
pick-up and drop-off service.

Day Care
Home away from Home

Fetch! Pet Care

Number: 866-338-2463
Website: www.fetchpetcare.com
Founded: 2002; Franchised in 2004
Category: Day Care and Boarding
Description: Pet care service that provides in-home pet care visits in over
1,700 cities. Visits include waste management, dog walking and dogsitting
(both daily and overnight), as well as
regular household maintenance like
watering plants and retrieving mail.

Waste Removal
Pet Butler

Number: 1-800-PET-BUTLER
Website: www.petbutler.com
Category: Pet Waste Removal
Number of Locations: 132
Description: Pet Butler is a pet waste
removal service, providing professional removal of pet waste to private
residential areas and community
parks. Other services include yard
maintenance to ward off bugs and
maintain lawns and patios.

Preppy Pet Suites

Number: (407) 420-1060


Website: www.preppypet.com
Founded: 2003; Franchised in 2006
Category: Day Care and Boarding
Number of Locations: 18
Description: Preppy Pet Suites provides day care and pet boarding
services for a wide range of animals,
including dogs, cats, birds and small
animals. Superior kennel designs
unique to Preppy Pets Suites are provided exclusively for more flexibility in
setting up facilities.

Dogtopia

Number: 240-514-0210
Website: www.happytailsdogspa.com
Founded: 2002; Franchised in 2005
Category: Daycare and Boarding
Number of Locations: 50
Description: Services available at Dogtopia locations include day care, overnight boarding, spa services, dog training and a gift boutique.

Photography
DoodyCalls

Number: (434) 244-0143


Website: www.doodycalls.com
Category: Pet Waste Removal
Number of Locations: 35
Description: DoodyCalls specializes in pet waste removal, providing
residential and community cleaning.
Services include cleaning, disinfecting and deodorizing pet areas.

29

Lil Pals Pet Photography

Number: (901) 682-9566


Website: www.lilpalsphoto.com
Founded: 2004
Category: Photography
Number of Locations: 5
Description: Lil Pals Pet Photography is a mobile pet photography
service, working primarily in host
locations among pet groomers,
vet clinics, fundraising organizations, grocery stores and pet supply outlets.

Business Opportunities Journal

How to pick a dog harness


Pet Supplies Plus

Number: (866) 477-7747


Website: www.petsuppliesplus.com
Founded: 1988
Category: Pet Food and Supplies
Number of Locations: Over 215
Description: Pet Supplies Plus has
grown to over 215 locations in 21
states, providing pet products for
a wide range of pets. Products are
carried for dogs, cats, aquarium
fish, birds, reptiles and small
animals, including everything they
will need, from food, to housing to
grooming supplies.

Pet Food
& Supplies

Just Dogs! Gourmet

Number: 888-332-0307
Website: www.justdogsgourmet.
com
Founded: 1998
Category: Pet Food
Number of Locations: 41
Description: Just Dogs! Gourmet
specializes in baking hand-cut, allnatural dog treats.

No-pull harnesses come in a variety


of styles. You may need to try several
to find one that works on your individual dog.
Some harnesses, like the Easy Walk
and the Softouch attach the leash to
a point on the dogs chest rather than
neck or back, which make it more difficult to pull while walking forward.
Another approach, used by the Sporn
Training Halter and Non-Pulling Mesh
Harness involves straps that go under
a dogs front legs and tighten when
he pulls.
The Weiss Walkie is the simplest design. Unlike others, it come in only
one size that fits most dogs over 25
pounds. Its basically just one strap
around the dogs chest that tightens
when he pulls.
Designer Emily Weiss created it while
working at an animal shelter so it
would be easy for volunteers to use.
She recommends that you not use
these harnesses to give leash-jerk corrections
``It works best when we let the dog
figure it out, she says. ``If we apply a
correction, it makes it harder for him
to figure it out.
There are several brands and styles
of head halters available as well, including the Gentle Leader, Halti and
Snoot Loop. The difficulty with halters
is getting the dog used to them, and
at least one study suggests dogs dislike all brands equally.
Trainer Victoria Stilwell of ``Its Me or
the Dog on Animal Planet says its
very important to desensitize the dog
to the head halter gradually.
``Take a week before taking it out on
a walk, she says. Associate putting on
the harness with an especially desirable treat, and also reward the dog
for not pawing at it. If you have the
patience, most dogs will get used to
them, and they do stop pulling.

Business Opportunities Journal

30

All of By LINDA LOMBARDI


these For The Associated Press
products, trainers emphasize, should be
seen as a way to get the situation under control so you have the opportunity to train your dog.
Equipment doesnt teach you to communicate with your dog the way
training does, and communication
gives you a big head start on solving
other behavior problems when they
arise.
When she gets called in by a client,
Weiss says, she often thinks, ``If your
dog just knew that when you do X I
do Y, wed be 10 steps ahead in fixing
this behavior problem.

Man challenges Seattles


pooper scooper law
SEATTLE (AP) A man who was given a
ticket while walking his dog in a Seattle park is challenging the citys poop
scoop law.
The man, Steve Guiling of Mount Vernon, was given the $54 citation in
November for failing to carry scoop
equipment as he walked his dog Amy
in Discovery Park.
He told The Seattle Times theres no
definition of such equipment, and he
could easily find a plastic bag or use
his hands.
Animal control enforcement supervisor Don Baxter says a lot of people
make excuses that they would use
their hat or gloves to pick up dog
waste.
The city issued 65 dog poop citations
in 2007, including the scoop law and
allowing an accumulation of waste on
property. The waste carries parasites
and diseases and washes into waterways.
Information from: The Seattle Times,
http://www.seattletimes.com

s
w
e
N
g
n
i
k
a
Franchises M
Licensing key for Einstein Noah growth in 09

AP Wire Service

LAKEWOOD, Colo. (AP) Einstein Noah Restaurant Group


Inc. is sticking to plans to grow mostly by adding licensed
locations in 2009 as diners eat out less and credit markets
remain tight.

tighter requirements from lenders but also some room to


negotiate with landlords on rental terms, Carolan said.
The process of opening new stores also has slowed, he said.
In September, Einstein Noah said it hoped to have five new
franchised Einstein Bros. Bagels locations open at the end
of 2008. Instead it had two, according to a regulatory filing
with the Securities and Exchange Commission.

The fast-casual coffee and bagel chain said this month that
it plans to open six to eight new restaurants on its own,
matched with the same number of franchise restaurants
this year, where franchisees develop a new store that meets
company guidelines.

Einstein Bros. Bagels launched its franchise program in


December 2006. It has not changed its requirements for
franchisees to be worth at least $1 million, with $400,000
in available liquid assets.

It also plans to open 30 to 35 license restaurants, where


licensees use the companys brands to open bagel and
coffee operations in such locations as airports, colleges
and hospitals.

Advertise in the

Einstein Noah started the year with 648 Einstein Bros. Bagels,
Noahs New York Bagels and Manhattan Bagel restaurants.
A little more than one-third were franchised or licensed
locations. The company aims for about half its restaurants
to be franchised or licensed by 2012. Einstein Noah had 612
total restaurants at the end of 2007.

BusinessOpportunitiesJournal
We specialize in covering the serious
business of franchises, business opportunities, and real estate investments.

Paul Carolan, senior vice president of franchising and


licensing for Lakewood-based Einstein Noah, said adding licensed and franchised stores will be key to meeting
customer demand.

Our editorial staff includes real


world business-ownership experience. We take great pride in our
fair coverage, in-depth research,
and breadth of experience.

``We just cant build them fast enough ourselves, he said.


Still, the sour economic climate has affected sales. In the
quarter ending Sept. 30, comparable store sales fell 1.7
percent.
Carolan said fast-casual chains havent been hurt as much as
casual dining restaurants where customers typically stay to
eat a meal and tip their servers. Franchisees have reported

Call 800-854-6570 ext. 108 today.


31

Business Opportunities Journal

FRANCHISING NEWS

Willmar familys pizza company


expands in Midwest

By GARRET FELDER
West Central Tribune

As of December, Jimmys Pizza


Inc. has 44
franchise
stores spread
among the
smaller
towns of
Minnesota,
Iowa, Wisconsin, the
Dakotas and
one store in
Colorado.

WILLMAR, Minn. (AP) Jim Gordon greets customers


about six times a year while standing behind the counter of a Willmar pizza joint, the relentless aroma of tomato sauce and spices surrounding him.
The owner of Jimmys Pizza Inc. based in Willmar, Gordon
has plenty of office work to keep him busy with Jimmys
Pizza franchises popping up all around the Midwest, but
he still likes getting back into the kitchen.
And why not? After 23 years in the pizza business, side
by side with members of his family, Gordon is just starting to reap the fruits, and perhaps vegetables and meat
toppings, of his labor.
``Theres been a lot of times when its been tough, just
like any business its hard work, Gordon said. ``But overall I think its been an exciting, fast-paced business. Making a pizza is fun, it always has been.
In 1986, Gordon opened the first Jimmys Pizza in Pine
City after buying the store space from his father, Frank
Gordon. His father had operated a full-menu restaurant
there before the sale.
``I told him it was crazy, said Frank Gordon of Willmar.
``But he is a very good businessman. He makes very
good decisions, he thinks them out. And he did that
when he was younger. He just loved the (restaurant)
business.
Frank said his son ``had a knack for restaurant management and remembers when his son was 11 years old,
opening up one of the familys restaurants in the early
morning hours. Gordons parents had owned numerous
restaurants in Minnesota after the family moved from
Laguna Beach, Calif., when Gordon was a first-grader.
Even with that experience, Gordon had his failures.
When Gordon went into the pizza business at age 23,
it was after a hard lesson learned. Just a year prior, Gordon had tried opening a full-menu restaurant in Pine
City and didnt succeed. ``I tell people I was able to lose
$10,000 in about six months, Gordon said.
The pizza business seemed like a logical option, Gordon
said, because he had been a cook for a St. Cloud pizzeria
while finishing high school in Sauk Rapids. He said his inlaws also injected the business into him: his brother-inlaw had worked at a St. Cloud pizza shop and his fatherin-law opened a pizza store in Rice.
Nine months after that first Jimmys Pizza opened in Pine
City, Frank Gordon opened a store in Braham in September 1986 and quit his full-time job with 3M. Shortly
afterward, Jim Gordon said, he and his father bought a

Business Opportunities Journal

32

store in Mora.
``We were in a lot of small towns, Gordon said. ``And at
that time, in 86, we were the first chain that was delivering in these small towns. You did not see delivery service
in small towns in those days, and I think that was a niche
for us.
Soon, Gordon, his wife, Jana, and Gordons parents were
operating five pizza stores per couple and then selling
them to store managers.
Jana said the family found that ``every town has its own
personality and its always kind of a challenge to see
what works in what town.
Over 10 years and numerous stores later, the state of
Minnesota contacted Gordon about the business arrangement he was making with his store managers. The
state said Gordon needed to protect the new owners
using the brand name by making Jimmys a franchised
company.
The Gordon family is glad it did. As of December, Jimmys Pizza Inc. has 44 franchise stores spread among the
smaller towns of Minnesota, Iowa, Wisconsin, the Dakotas and one store in Colorado. Expansion into Nebraska
also looks imminent, Gordon said.
Gordons oldest son, Jimmy, is leading the Nebraska
expansion project, and the 21-year-old already owns
stores in Isanti and in Watertown, S.D. Gordons 18-yearold daughter, Justine, works as an assistant manager for
the Willmar corporate store, which is used as a training
ground and showroom for prospective franchisee owners.
Gordon made Willmar the corporate center because it
was close to his familys fall hunting grounds near Raymond. And it probably doesnt hurt that Minnesota is
the land of 10,000 lakes. Gordon is also a professional
fisherman for the FLW Walleye Tour.
``Not only do we sell it, we believe it, Gordon said.
``When we say family business, its been a family business.
Gordon said he wants his three youngest children to
try something else before following the family path like
their older brother and sister.
``Were a lot closer than your normal family, Jimmy Gordon said. ``I know I spend probably how many hours a
day talking to my grandparents and (my parents), Jimmy said. ``(The pizza business) is in your blood. Its like
an addiction.

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33

Business Opportunities Journal

FRANCHISING NEWS

MARTINIZING TURNS 60

Led by CEO George Strike for past 30 Years


(Loveland, OH)--- George L. Strikes first job was helping the
local milkman on his daily deliveries, running cold bottles of
milk to neighborhood houses. He was 10 years old and Strike
earned 10 cents a day for his before-school job; 25 cents on
Saturdays because he could work half a day. It was a good
wage in Salt Lake City, Utah at the time.
For 10 cents in those days, I could see a double-feature at the
movie theater, including the newsreels, Strike recalled.
Strikes parents, Louis and Christina, were self-educated Greek
immigrants. George was the youngest of their four children.
Strikes parents instilled important lessons in their children
and Strike took them to heart.
My parents told me that if you do the very best you can in
whatever job you have, opportunities will come for you and
they were absolutely right, he said.
Turning his parents advice into his own creed, Strike today is
CEO and Chairman of Martinizing Dry Cleaning, founded in
1949 and now one of the oldest and most recognized brands
in the $7 billion dry cleaning industry as Martinizing celebrates its 60th anniversary in 2009.
Since taking over the company in 1978, Strike has been instrumental in growing Martinizing into a worldwide brand
and today it is the largest dry cleaning franchisor in the United States, with more than 160 franchisees operating more
than 550 stores across the United States and in eight other
countries and U.S. Territories.
It just comes down to the basics: quality and service, said the
amicable Strike. Strikes father was an inventor whose ingenuity helped create significant improvements in the clothes
pressing industry. That inventiveness enabled Louis Strike
to start Ajax in 1929, a company that manufactured laundry
presses and where George got his start in the industry, working part-time as a delivery clerk as a teenager.

tinued to operate its own division and within five years, at


age 32, Strike was named president of the entire company,
a particularly proud moment for Louis Strike since American
Laundry had been his chief competitor.
After a decade as president of American Laundry, Strike resigned and in 1973 purchased Hess & Eisenhardt, a leading
automobile engineering and manufacturing company that
had customized the limousine that John F. Kennedy was riding in when he was assassinated in Dallas in 1963. Hess &
Eisenhardt specialized in building hearses, ambulances and
other specialty vehicles such as armored automobiles, but
Strike helped expand its business even further by adding
markets and product lines, including a project with Jaguar,
in which the company produced a special-order XJS convertible. It was a fascinating experience, Strike said.

Strike inherited his fathers sense of curiosity and passion and


parlayed it into a business career that is as interesting as it is
successful. His parents endured hardships in the Greek village
that they left to come to the United States and Strike says he
couldnt have achieved his own success anywhere else.
After attending the University of Utah, Strike went to work
for Ajax, his fathers company. Afterwards, it was bought by
American Laundry Machinery Co., the largest laundry machinery manufacturer in the United States. The family con Business Opportunities Journal

34

We always say our business is recession-resistant and we


believe that, but it has definitely been proven in these difficult times, Laesser said. Weve had lots of competition in
recent years from competitors who had some big ideas, but
theyve fallen by the wayside. Were a conservative company.
We dont do a lot of flashy things, but we get it done.

In 1978, Strike returned to the family business, purchasing


the struggling American Laundry Machinery Co., which included Martin Franchises, Inc. (Martinizings parent company)
and continued the legacy his father began. In 1987, Strike introduced a new franchise agreement that offered improved
support and was more reflective of a full-format franchisor.
Three years ago, Strike once again assumed a more active
role in the company after son Anthony Tony Strike, who had
been serving as president and CEO, began focusing more on
other family businesses.

About 30 percent of Martinizing franchisees own more than


one store. And while the company guides and directs its franchise owners, Strike trusts them to operate their stores in the
way they know best.

Recently, Strike spoke to some graduate business students


from the University of Utah and gave them three pieces of
advice: 1) An education lasts a lifetime and doesnt end with
formal schooling; 2) Do the best you can at every job; and 3)
Follow your moral compass.

You always like to have a strong relationship with your customers, which in our case are our franchisees, but our relationship with them transcends that, Strike said. The franchisor-franchisee relationship is a very strong bond. We view our
franchise owners as our partners.

Since we were young, each of us has been able to recognize


the right thing to do in any given situation, Strike said. Its
important in business that you do the right thing. Most of the
time its easy, but it matters most when its difficult to do.

In many ways, Strike said the current recession has served to


spotlight Martinizings strengths. It is in times like these, that
a companys strengths and weaknesses are magnified, either
positively or negatively. Thus, Martinizing truly does have
something to celebrate during its 60th year.

Martinizing is holding up well during the current economic


climate. The franchise has more than 100 stores to open under Exclusive Multi-Unit Development Agreements over the
next few years. Stores opening in 2008 were up from the
previous year and it anticipated that 2009 will double those
openings since there is an increase in the availability of rental
space and at lower rental rates due to the economy.

This difficult economic climate really enhanced our feelings


about the future of our business, Strike said. The true value
of a business really comes through in difficult times. We have
a strong, competitive advantage and were gaining market
share. The outlook for Martinizing is the best ever.

Fast-food outsourcing gets trial run in Charlotte


to the quick-service restaurant industry.

CHARLOTTE, N.C. (AP) _ A fast-food giant has been trying to determine whether its easier to place your drive-through order with
someone around the world instead of around the corner.

AP Wire Service

Customers in Charlotte have noticed heavy accents among


order-takers only to find different workers at the drive-through
window.

Jack in the Box Inc. has been outsourcing order-taking for some
Charlotte-area restaurants to a call center elsewhere, testing
whether the idea could improve efficiency.

``I had noticed it (several months ago), but I just thought the person taking the order was somewhere else in the store where we
couldnt see them, said Elizabeth Banks, a Charlotte teacher and
mother of three. ``It never occurred to me they might be out of
the country.

Company spokeswoman Kathleen Anthony told the Charlotte


Observer that the technology is intended to improve speed, accuracy and service. The San Diego-based restaurant chain hopes
the process will free up on-site employees to process orders, accept payment and address other needs.

Kate Mosteller, marketing director of Andover, Mass.-based Exit


41, which focuses on off-site order taking, said the technology
can help eliminate barriers between customers and employees
who speak different languages. But it can also be difficult to
match order-takers with customers who may have different dialects or expectations.

``It is something were testing, not something were necessarily


committed to at this point, said Anthony, declining to discus the
results of the Charlotte trial that began in the middle of last year.
Anthony told the Observer that the orders are routed to a Texas
call center operated by Bronco Communications, and she said
some orders may be routed outside of the country.

``You want someone whos friendly and articulate and who can
understand ... different nuances, Mosteller told the Observer.
``(Otherwise) youre going to know youre (being routed) somewhere else, and thats exactly what you dont want to do.

Restaurants including McDonalds and Wendys franchisees have


tried centralizing orders but neither has used the program nationally because they have found it difficult to prove it saves
money, said Sherri Daye Scott, editor of QSR Magazine, dedicated
35

Business Opportunities Journal

FRANCHISING NEWS

Tulsa man wants to expand Dippin Dots

By KIRBY LEE DAVIS


The Journal Record

TULSA, Okla. (AP) _ Ryan Hausher foresees great opportunity in


Oklahomas first full Dippin Dots store.

``Events are where Id like the lions share of the profits to come
from, Hausher said. ``Its great exposure for the product, its great
exposure for the company, and were able to give a little back.

But he anticipates even more potential building sales beyond


that 906-square-foot Promenade Mall site, which he sees as a
launch pad for offsite sales.

Such offsite sales also allow him to expand Ryadds franchise


area without adding storefronts.

``Our goal is to do as many outside sales as possible -- fundraisers, catering, corporate events ... anything fun, said Hausher, a
franchise industry and corporate American veteran. ``Id like to
take the three franchise locations that I have now and develop
an attraction in each area where Dippin Dots is the go-to company when you want to raise money.

``Dippin Dots as a store is very accommodating in your ability to


branch out, he said. ``My goal is to have more outside business
than inside business.
The larger Promenade spot also gives Ryadd room to create new
specialty products like the Birthday in a Box, which features a
Dippin Dots cake, balloons, hats and other celebration fixings
for 12 to 14 people. Its price remains undetermined.

At $12,500 each, his new firm Ryadd LLC of Tulsa acquired franchise kiosks from the 22-year-old ice cream chain at the Towne
East Mall in Wichita, Kan., at the Northwest Arkansas Mall in Fayetteville, Ark., and at Tulsas Promenade Mall.

Getting into business for himself promises a quality-of-life


change for Hausher and his 13-year-old daughter, Addison. Their
first names determined the companys moniker.

While these kiosks offer lower costs, Hausher said the smaller
platforms not only restrict the number of flavors he may stock _
such as Strawberry Cheesecake, Java Delight or Birthday Cake _
but also dont allow room for distinctive products like Dot Cakes,
Dotwiches, or Dotsn Cream.

``She cant wait to help out in outside events this summer and
learn the ropes, he said. ``Maybe one day shell have an empire
to take over.
That depends on his starting and building a business under one
of the worst economies in decades. But with long-term relationships under two lenders to draw from, Hausher remains optimistic.

And theres definitely no room for shakes, malts, sundaes or other traditional treats made more distinctive by the cryogenically
frozen pellets, which must be stored at 40 degrees below zero.

I think something fun is always good to bring to kids and adults


when times are tough, he said. ``Even in tough times, people
still want to be happy and eat ice cream.

So Hausher took his Promenade location to a leased storefront,


the first in the Sooner State for the Paducah, Ky., company. He
will celebrate its grand opening Jan. 24.

He has already fielded expansion offers from other malls in Oklahoma. In February he intends to launch a Dippin Dots vending
machine in a Bartlesville shopping center. The Dripping Springs
Yacht Club at Grand Lake may receive one this summer.

``We thought wed pioneer the inline store in Oklahoma and


make it as successful as possible, he said.
The choice increases his cost from the $30,000 to $60,000 expected for a kiosk to the $80,000 to $235,000 he said may accompany an inline store. Since the Promenade slot formerly
housed a Dairy Queen, providing all the necessities for a food
operation, that limited his expenses to cosmetic changes _ color
scheme, signage and the like.

An inline store at Quail Springs Mall also may develop this year,
providing a similar events platform in Oklahoma City.
``We just watch how we expand and do it very methodically and
definitely not try to overexpose ourselves, he said of expansion.
But he also pointed all such moves to one foundation for success.

Hausher estimated his initial investment at less than $100,000,


although he plans to move the Wichita franchise to a smaller
mall in Fort Smith, Ark., for closer proximity. He hopes to record
monthly sales of $7,000 to $15,000 at the kiosks and $15,000
to $25,000 at the Promenade storefront, with a minimal staff of
three employees at each location.

``When you have Dippin Dots, they come, he said of customers.


``For a lot of people, its a destination location. Theyll seek out
Dippin Dots.

``Thats the beauty of it, he said. ``You dont have such a vast
menu that your labor eats you up.
The extra room at Promenade allows Ryadd to stock and manage
offsite events, either through direct sales or by staffing booths.
He already has deals to sell Dippin Dots at festivities with Union
High School and Guts Church in Tulsa.

Business Opportunities Journal

36

$1,300,000+

Model locations gross income*

$700,000+

Model locations gross profit*

$450,000

Minimum net worth required

Considering the return on investment, its perfectly acceptable to pant.


As an All American Pet Resorts franchisee, youll have all the support you need to succeed. Front and back office
expertise. Site design and layout. Advertising and marketing. Staffing. Training. Certifications. All backed by an
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Disclosure Document, Item 19. Actual results vary from unit to unit and we cannot estimate the results of any particular All American Pet Resorts Business.
We recommend that you make your own investigation and determine whether the All American Pet Resorts Businesses are profitable. We recommend that
you consult with an advisor of your choosing. Even though the above figures are actual results, the FTC requires us to include the following statement in
this advertisement - Caution: These figures are only estimates. There is no assurance or guarantee that you will do as well. If you rely upon our figures,
you must accept risk of not doing as well.

941-661-1175

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www.allamericanpetresorts.com

Report: NV ranks
2nd for smallbusiness climate

AP Wire Service

RENO, Nev. (AP) _ A report says


Nevada ranks second nationally
for its friendliness to small businesses primarily because of its favorable tax structure.
Nevada was second only to South
Dakota in the Small Business Survival Index, which looked at all 50
states.
The indexs rankings are based
primarily on a states public policies and how they affect small
businesses.
Nevada ranked first in several
areas, including tax rates for personal and corporate income and
capital gains.
Nevada also ranked first for having the lowest number of government employees per 100 residents.
California was ranked 49th overall
in the index.
The report was released by the
Small Business & Entrepreneurship Council based in Oakton, Va.

Don Callender, pie entrepreneur, dies at 81


AP Wire Service

LONG BEACH, Calif. (AP) _


Don Callender, an entrepreneur with a passion for pies
who built his mother Marie
Callenders
home-based
baking business into a popular brand, has died. He was
81.
Callender died Wednesday
at Hoag Memorial Hospital
Presbyterian in Newport
Beach from injuries he suffered in a fall in 2007, said his
wife, Katy.
Marie and her husband, Cal,
set up a wholesale bakery in
Long Beach in 1948. Marie
worked long hours producing pies for Cal and Don to
sell to restaurants.
``We had three rolling pins
and this old oven, and we
used to work all night, Marie
told the Los Angeles Times
in 1986.

The pies were hugely popular and Don Callender eventually came up with the idea
of opening a pie and coffee shop in Orange in 1964.
Named after his mother,
Marie Callenders Pie Shops
Inc. was so popular that Don
Callender opened two more
stores in the region.
Those shops only sold pies
but Don Callender wanted
to add other dishes, so after
experimenting with various
recipes he went on to add
hamburgers, ham sandwiches, chili and cornbread to the
menu.
By the time Don Callender
sold the company in 1986 to
Ramada Inc. for a reported
$80 million, the chain had
grown to 120 locations nationwide. The restaurants
are now a subsidiary of Castle Harlan Inc.

Marie Callender died in


1995.
Kent Kitselman, who started
with the company as a dishwasher in 1972, and now
owns three Marie Callenders in Southern California,
said Don Callender had considerable drive and would
reward hard work from his
employees by giving them
opportunities.
``All he wanted to talk about
was food recipes, Kitselman
said. ``It was his interest. It
was his life.
Callender continued to work
in the restaurant business
until the end, launching
Babes Barbecue and Brewhouse outlets in Southern
California and a Jackalope
Ranch restaurant in Indio
that opened the day after he
died.

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39

Business Opportunities Journal

BUSINESS OPPORTUNITIES

s
e
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t
i
n
u
t
r
o
p
p
O
Business
p
i
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s
r
u
e
n
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p
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& Ent
Scourge of forest beetles turned into a profit

Producers have relied on sawBy SANDY SHORE


dust from mills that cut lumber
AP Wire Service
for housing. If they are forced to
collect dead trees and process
them, the cost could be three to four times greater, Swaan said.

DENVER (AP) _ A tiny middle school tucked in a snow-covered


mountain valley ditched its decades-old coal-fired boilers for
a wood pellet furnace, partly due to a beetle not much bigger
than an eyelash.
Mountain pine beetles have ravaged wide swaths of trees in
Colorado, leaving the surviving forest more susceptible to fire
from decaying trees.

That could make the business less competitive when oil is cheap.
Crude has given up two thirds of its value since peaking near $150
over the summer, which led to sharp increase in sales for wood
pellet producers, particularly in the Northeast where heating oil
is used widely.

A handful of businesses are trying to capitalize on a bad situation,


and may incidentally prevent it from getting worse.
Sorocco Middle School contacted one of the two wood-pellet
plants in Colorado that have opened since the beetles began
attacking trees a number of years ago, and now draws heat from
pellets.

Despite its cyclical nature, investors believe the business model


is workable.
At Grand Lake on the outskirts of Rocky Mountain National Park,
Joe Kostelac and his neighbors began talking about dealing
with the dead trees and created the Rocky Mountain Pellet Co.
in nearby Walden. The 20,000-square-foot mill began producing
pellets last fall and has sold as much product as could be manufactured through April.

``Its a disturbing situation to watch all of our trees die and we


know this is going to dramatically impact our landscape, said
Mark Mathis, president and chief executive of Confluence Energy,
a pellet producer about 100 miles northwest of Denver.
In Colorado, beetles had infected at least 1.5 million acres of forest as of 2007, creating vast tracts of dying red and gray forest.

``We really believe the growth is in the industrial side and commercial application of this product because of gas and oil and
all the other energy products, said Kostelac, who came out of
retirement to run the company.

The beetles that have scarred breathtaking vistas from Alaska and
British Columbia to the Southwest have spread because warmer
winters allow more to survive, according to the U.S. Forest Service.

In the Yampa Valley, the South Routt School District installed


Soroccos wood pellet heating system as part of a $4.1 million
renewable energy project that also includes a geothermal heat
pipes. It was financed by state grants and a bond issue.

Forest Service officials believe most lodgepole pine _ the predominant pine tree at higher elevations _ will be killed by 2013
and it could take decades before they return.
The predominant use for beetle-killed trees is still housing lumber,
but the downturn in real estate has piqued interest in harvesting
more dead trees for fuel, said John Swaan, executive director of
the Wood Pellet Association of Canada.

Business Opportunities Journal

``I think its definitely a conscious effort to make a green impact


on the community. By using products that are close to home, it
multiplies that effect drastically, Sorocco Principal Dennis Alt says.

40

Small business woes have big impact on US economy


the neighbor- By EMILY FREDRIX and ASHLEY M. HEHER
hood, opening
AP Retail Writers
his shops space
for community
meetings and writing letters to a popular local Web site, asking
them to publicize his plight.

NEW YORK (AP) _ Times are tough for small business owners,
those whom politicians tout as the backbone of America. As the
recession marches on, its those businesses _ which employ about
half of the countrys private-sector workers _ that are particularly
vulnerable to the squeeze.
To cope, small business owners _ from neighborhood plumbers to
graphic design firms _ are paying employee salaries before their
own, trying to renegotiate leases and pleading for customers on
neighborhood blogs. But despite their best efforts, the customers arent there.

``Right now Im trying to do everything I can do, he said, adding


that hes using his own money to pay the coffee shops bills and
the salaries of his two employees. ``With every hour that Im staying open, Im not making money. Im losing money, which doesnt
make much sense.

``Its all feeding on itself, said Raymond Keating, chief economist


at the Small Business Survival Committee, an advocacy group
based in Oakton, Virginia. ``People are scared. Theyre not quite
sure what to do.

Thats why Bonnie Mihalic closed her eponymous costume and


bric-a-brac store on New Years Eve, after sales fell by 50 percent
during the all-important Halloween season. When she shut down
the Ventura, California shop, she laid off her seven employees and
said goodbye to loyal customers she had come to know during
30 years in business.

Not every small business is facing impending doom. But the


economic quicksand brought on by the longest recession in a
quarter century is getting worse as the nations unemployment
rate reaches a 16-year-high and banks become more careful about
lending money. Thats consuming even local favorites like Heinemanns restaurant chain in Milwaukee, Olssons Books & Records
in Washington, D.C., and The Music Mill, a popular performance
space in Indianapolis.

``Theyre like my children. Or my grandchildren, the 76-year-old

We can put

your logo

Small businesses _ defined by the government as having 500 or


fewer workers _ are a key portion of the U.S.s commerce food
chain. They account for more than 99 percent of all employer
firms, according to federal statistics, pay nearly 45 percent of
the countrys private payroll and produce almost a third of the
nations export value.

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with 4imprint
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That means when they hurt, everyone feels the pain. Closures
affect communities, where friends are co-workers and customers, and the cost-cutting creates a hard-to-stop cycle. Charitable
donations wilt. Storefronts sit empty. Cities and towns get less
tax revenue, and have to cut their budgets. And people wind
up spending even less as those who are unemployed _ or those
who worry they will be _ trim their own budgets at the expense
of other businesses, large and small.
While falling sales and the credit crunch have made headlines,
the small business owners left standing are facing problems as
varied as the businesses they run. Manufacturing is slowing.
Layoffs are looming. Financing is hard, if not impossible, to
come by. Vendors are being skittish about extending credit for
inventory. Rents are rising. And profits are falling _ or vanishing
altogether as sales slip.

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Ajay Ekesa, 29, worries that his Kahawa Coffee House in Chicago
may not last through the spring. Hes spreading flyers around

41

Business Opportunities Journal

BUSINESS OPPORTUNITIES
said. ``Im heartbroken.

Odland.

his workers get theirs.

Now shes emptying her 10,000-square


foot (910-square-meter) store and moving
things to a warehouse. If she doesnt get rid
of her stock, including hundreds of wigs,
tiki torches, and leftover holiday decorations by the end of the month, shell owe
another $15,000 in rent.

The office supply chain is bumping up the


number of sheets in some reams of paper
and repackaging items such as pens into
smaller _ and cheaper _ packages.

More than 110 people lost their jobs this


month when the Heinemanns restaurant
chain, a Milwaukee institution for 86 years,
shut the three restaurants that remained of
what was once a 10-location chain.

Its not just communities that feel the pain.


Small businesses that are pinching their
pennies also thwart corporate America.

Officials said fewer customers were buying


more expensive items like desks and file
cabinets or computers.

Just ask Wal-Mart Stores Inc., which blamed


a pullback in spending by more cautious
small business customers shopping at its
Sams Club stores for lower-than-expected
December sales figures on Thursday. The
surprise shortfall stunned investors in the
worlds largest retailer, which had been
weathering the recession by catering to
bargain shoppers.

``I do what Ive got to do to keep the business running and the employees paid,
said 36-year-old Parrish Walker, who owns
Walkers Oak and More Furniture store
in Fort Oglethorpe, Georgia. ``Its really
having to think about every purchase and
decision instead of buying willy-nilly.

The scrimping is spurring Office Depot Inc.,


which gets about 80 percent of its business
from corporate customers, most of whom
operate small and home-based businesses
_ to change some of its merchandise,
said Chief Executive and Chairman Steve

``They say I just cant afford to buy a bulk


pack of this, Odland said.

Being deliberate about expenses is one


way hes coping with the fact that sales are
down more than 10 percent at the northwest Georgia store his father opened 15
years ago. Hes also scaling back on inventory, making sure the schedules of his four
employees are as efficient as possible and
forgoing his own paycheck to make sure

Their clientele was aging, and as they


were aging and dying they werent able to
replace all those people with new people
because younger people want chains they
can recognize, said Jerry Kerkman, a lawyer for the company.
Customer Dennis Sell, 58, was a regular
for more than a decade, ordering oatmeal
pancakes and eggs, toast and sausage at
Heinemanns on weekends before settling
in for hours with a newspaper. He ate his
last meal there on Saturday.
``Im hoping its a dream and Ill somehow
wake up and hopefully none of this really
happened, he said.

Pasta makers business cooking as economy droops

By DAVID TWIDDY
AP Business Writer

KANSAS CITY, Mo. (AP) _ As struggling


consumers turn to casseroles, soup, pasta
salad and good old macaroni and cheese
to stretch their food dollars, the nations
pasta makers are returning to a rolling boil
after many years overshadowed by the
low-carbohydrate fad.
Sales of pasta products in the United States
_ including frozen and refrigerated pasta,
canned pasta, soup mixes and prepared
dinners _ rose 5 percent last year to $6.4
billion, according to Kansas City-based
Business Opportunities Journal

American Italian Pasta Co., the nations


largest manufacturer of dry pasta.
Most of that increase came as manufacturers passed along a stiff jump in the price of
wheat and other costs.
But Peter Smith, chief executive of Harrisburg, Penn.-based New World Pasta, which
makes such brands as Ronzoni, American
Beauty and Creamette, said he was amazed
commodity price hikes last year didnt
dampen pasta sales the way they did sales
of other consumer goods.
42

``I think what happened this past year


is with all the inflation running rampant
through the stores, he said, ``Its like a certain number of people rediscovered pasta.
Smith said revenue at his company rose 25
percent last year to around $460 million
while volume grew between 1 percent
and 2 percent.
Total U.S. consumption rose 0.4 percent
by volume, according to The Nielsen Co.,
although those number dont include sales
at Wal-Mart Stores Inc., where industry of-

ficials say noodle numbers grew even faster.

sumers.

The volume increase is particularly welcome because pasta


consumption had been falling 1 percent or 2 percent annually
for years because of high-protein diet fads, said Carol Freysinger,
spokeswoman for the National Pasta Association.

The company has seen its stock price rise 76 percent to $25.90
since mid-November when its shares were relisted after it spent
three years dealing with an internal accounting matter.
``It is still an incredibly great value, Kelly said of pasta. ``For about
$5, you can feed a family of four.

``Theres this renewed vigor, this renewed energy in the pasta


companies, Freysinger said. ``They really got beat up by the lowcarb diets, which showed to not be that effective in the long run.
``Pasta has been vindicated, she said. ``And (now) the economy
is driving consumers to more cost-effective options.
Judy Donnellan, 45, was shopping for macaroni at a grocery store
in Kansas City Tuesday and said her family eats
pasta about three or four times a week.
``Its simple and cheap and I have kids and thats
something they like, Donnellan said.
She said she couldnt tell if she was buying pasta
more than before but said the staples price and
flexibility ``is basically why I use it.
``When they sell it for, like, four for $1, I stock up,
she said.
The U.S. division of Italy-based Barilla Group,
the worlds largest pasta manufacturer, saw a 15
percent boost in pasta volume and a 22 percent
increase in sales, said the divisions president, Kirk
Trofholz.
He said the company, which makes Barilla-branded
pasta, has also seen success with pasta made with
whole wheat or extra fiber, calcium, omega-3 and
other nutrients.
``We expect the better for you pastas to continue
to grow fast, he said.
In 2008, consumption of dry pasta hit its highest
level since 2003, according to American Italian Pasta, which makes consumer brands such as Ronco,
Muellers and Pennsylvania Dutch and supplies
pasta for in-house grocery store brands and for
manufacturers who use pasta in prepared dishes.
Annual sales at AIPC soared 42 percent to $569
million in 2008, and AIPCs net profits more than
tripled to $19.1 million _ even as its volume fell
0.5 percent.
CEO Jack Kelly expects higher volumes in 2009 as
his company focuses on its best markets, and he
predicts improved sales of grocery store brands,
which have benefited from bargain-hunting con43

Business Opportunities Journal

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US foreclosure filings up 81 percent in 2008

By ALAN ZIBEL
AP Real Estate Writer

WASHINGTON (AP) More than 2.3 million


American homeowners faced foreclosure
proceedings last year, an 81 percent increase from 2007, with the worst yet to
come as consumers grapple with layoffs,
shrinking investment portfolios and falling
home prices.
Nationwide, more than 860,000 properties
were actually repossessed by lenders, more
than double the 2007 level, according to
RealtyTrac, a foreclosure listing firm based
in Irvine, Calif., which compiled the figures.
Foreclosure activity rose 26 percent last
year in Ohio, a state that had one of the
nations highest foreclosure rates, the
report said.
Moodys Economy.com, a research firm,
predicts the number of homes lost to
foreclosure is likely to rise by another
18 percent this year before tapering off
slightly through 2011.
Still, foreclosures, which keep breaking
records going back 30 years, according
to the Mortgage Bankers Association, are
likely to remain well above normal levels
for years to come, and that will continue to
keep home prices from rebounding.
``Hitting bottom is a lot different than
coming off the bottom, said Christopher
Thornberg, a principal with Beacon Economics in Los Angeles.
The RealtyTrac report comes as Democrats, including President Barack Obama,
develop plans to use up to $100 billion

of the remaining $350 billion in financial


bailout money in an attempt to prevent the
foreclosure crisis from getting even worse.
The four states with the highest foreclosure rates last year were Nevada, Florida,
Arizona and California. Ohio ranked 7th.
More than 1.1 million properties in the top
four states received a foreclosure notice,
almost half the national total. And more
than one in five of those households were
in California, which is coping with massive
job losses in the housing and mortgage
industries as well as a rapid decline in
home prices.
Among metro areas, Stockton, Calif., was
first, with 9.5 percent of all housing units
receiving a foreclosure filing last year. It
was followed by Las Vegas, Riverside and
Bakersfield, Calif., and Phoenix.
In December, more than 303,000 properties nationwide received at least one foreclosure notice, up more than 40 percent
from a year earlier and up 17 percent from
November, according to RealtyTrac.
Nearly 79,000 properties were repossessed
by lenders in December, a 61 percent increase over a year ago.
New state laws, particularly in California,
Massachusetts and Maryland, that required
giving homeowners advance notice of
foreclosure proceedings, reduced filings
in several states. But the effect of those
laws has worn off, and lenders appear to
be going ahead with foreclosure, rather
45

than trying to modify loans.


``If all youre doing is basically giving a
stay of execution, then the inevitable will
follow, said Rick Sharga, RealtyTracs vice
president for marketing.
Foreclosures would have been about
10 percent higher in California last year,
Sharga said, if it were not for a law requiring
lenders to give borrowers a 30-day warning
before starting the foreclosure process.
Meanwhile, the president of the Federal
Reserve Bank of Philadelphia said Wednesday he expects the economy to slowly start
recovering in the second half of 2009 and
inflation to remain below 2 percent over
the next year.
In a speech at the University of Delaware,
Charles Plosser also said that the unemployment rate probably wont drop anytime soon, but that he doesnt expect it to
rise to double digits, as it did during the
recession of the early 1980s.
``I expect the housing sector will finally hit
bottom in 2009 and the financial markets
will gradually return to some semblance of
normalcy, said Plosser, adding that the current recession could be one of the longest
in the post-World War II era.
___
On the Net:
RealtyTrac Inc.: http://www.realtytrac.com

Business Opportunities Journal

REAL ESTATE OPPORTUNITIES

Real estate pioneer Trammell Crow dies at 94

By LINDA STEWART BALL


Associated Press Writer

DALLAS (AP) --Trammell Crow, a onetime accountant with no real estate


experience who built one of the largest
real estate development companies in
the nation, has died. He was 94.

Six year earlier, in 1942, Crow married


Margaret Doggett, whose father was a
successful grain merchant. Her inheritance helped fund his early entrepreneurial efforts, Raymond said.

Spokeswoman Cynthia Pharr Lee said


Thursday that Crow died Wednesday at
a family farm near Tyler in East Texas.
The cause of death wasnt immediately
released. In 2002, Crows wife disclosed
that the prominent developer suffered
from Alzheimers disease.

In the 1950s, Crow introduced Dallas


to the idea of building on speculation
--without a tenant lined up in advance.
He soon became a major industrial
developer in the city, building the
Dallas Market Center in 1957 and his
first downtown office building two
years later.

Friends and associates spoke glowingly


of his long and dynamic life.
``He was Americas greatest developer,
said A. Mack Pogue, chairman of Lincoln Property Co., and a former Crow
partner. ``He was everywhere. He probably did business in most of the states
of the United States. He started little
and got huge.
Pogue said courage propelled Crow
through the ups and downs of the
industry.
``He had nerve, Pogue said. ``He
would do things that other developers wouldnt do. Hed take certain risk.
He said, You only had to be right 51
percent of the time. He wasnt just my
partner. Trammell was a great friend
to all of us.
Crow grew up poor in Dallas, according to longtime business associate
and family friend Anne Raymond.
After serving as an ensign in the Navy,
assigned to finance duties, Crow returned to Dallas after World War II and
built his first building, a warehouse
near downtown, in 1948.
Business Opportunities Journal

In those days, Crow conducted business on a handshake. He relied on


hundreds of young leasing agents, and
those who proved themselves talented
and hardworking became partners.
This approach marked the evolution
of Crows then-unusual methods of
working in the real estate industry. As
he brought in new people to work on
residential and commercial projects, he
gave them an equity stake in the business. Crow explained that he believed
the projects would thrive if the people
managing them were partners rather
than employees.
``He was just such a wonderful man,
said Denny Alberts, Crows banker in
the 70s until the developer asked him
to head Trammell Crow Residential Co.,
a national apartment program. ``What
a legend and a visionary. He was probably the greatest partner you could
ever have. ... His word was his bond.
Biographer Robert Sobel said Crow
had another reason for using the partnership strategy: By offering equity
instead of pay, he conserved his capital
46

for putting up buildings.


Crows agents did more than $15 billion in development and eventually
gave him an interest in 8,000 properties, ranging from houses to hospitals,
hotels and office buildings.
Crow affected something of an awshucks manner in describing his success.
``I just happened to come along in the
right city at the right time, he once told
The Washington Post.
But Raymond, managing director of
Crow Holdings, the private investment
business, said there was more to it than
good timing.
``I think what made him so successful
was his vision, his unwavering optimism, and his never-ending quest
for knowledge, she said. ``He was
the most curious individual Ive ever
known.
By the 1960s, the changing economics of the real estate industry forced
Crow to change his loose network of
partners into a formal, centralized corporate structure. The company bearing
his name expanded beyond Texas,
breaking ground on the Embarcadero
Center office project in San Francisco
in 1968.
But the U.S. recession in the mid-1970s
hit the real estate industry hard. Crows
company was forced to renegotiate billions of dollars of debt and restructure,
taking back many assets as partners
left.

Crow stepped down as chief executive


in 1977.
But he remained active in politics,
the arts and philanthropy. He helped
secure Dallas winning bid to host the
1984 Republican convention. Crow
and his wife, Margaret, supported arts
groups and beautification projects in
Dallas and beyond.
They collected Asian art and founded
the Trammell & Margaret Crow Collection of Asian Art in downtown Dallas.
``He was a true Renaissance man, said
Alberts, who serves on the board of
Crows museum.
A lover of great poetry, friends said
Crow could recite entire poems by
heart on most any discussion topic.

``He was quite a remarkable individual,


said Dr. Kern Wildenthal, president of
the Southwestern Medical Foundation
and president emeritus of University
of Texas Southwestern Medical Center
at Dallas.
The family has donated at least $1.1
million for Alzheimers research to UT
Southwestern.
In spite of Crows gradual, cognitive
decline, his physician, Dr. Craig R.
Rubin said he remained positive and
was physically healthy except for the
Alzheimers. ``Basically he just went
to sleep.

of America.
``His remarkable life stands as a testament to hard work, visionary leadership, and the unlimited potential of
the entrepreneurial spirit, said Bob
Sulentic, CEO of Trammell Crow Company. ``We deeply mourn his passing.
Survivors include Crows wife, Margaret; six children: Robert, Howard,
Harlan, Trammell S., Lucy Billingsley
and Stuart; 16 grandchildren and three
great-grandchildren.

Crows company was sold in 2006 for


$1.8 billion to CB Richard Ellis Group
Inc., which was interested in Trammell
Crows list of blue chip corporate clients, including Exxon Mobil and Bank

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47

Business Opportunities Journal

REAL ESTATE OPPORTUNITIES

Scaled-down Phoenix houses spark home-value fears

By CHELSEA SCHNEIDER
The Arizona Republic

$300,000 to the $200,000s, said Rusty Shaffer, a real-estate agent


with Century 21. Even with architectural changes, the houses dont
look drastically different, Shaffer said.

PHOENIX (AP) Megan Foster didnt foresee the changes coming


to her Gilbert neighborhood when she closed on her house in
February.
The prices of the houses in Freeman Farms used to begin in the
$300,000s. But the deteriorating economy prompted builder
Fulton Homes to introduce cheaper models.
The new houses are less colorful, finished in a different stucco
and arent as tall, she said.
Angry at the builders action, Foster and four other families filed a
consumer complaint with the Department of Real Estate and the
Arizona Attorney Generals Office, hoping to prevent such practices from happening again. The families say if they had known
the house designs would change before they bought their homes,
they would have thought twice about moving there. The complaint is likely to be considered within several months to a year.
Builders across metro Phoenix are introducing pared-down versions of their models to boost their chances of selling houses
in a challenging market, but existing homeowners fear those
downgraded models may negatively affect their property values.
At Freeman Farms, the new houses begin in the $190,000s and
are a far cry from what some neighbors say they paid for their
homes. Residents understand that home values are dropping
in the depressed market. But they are concerned that once the
market rights itself, their values wont recover as well as they would
have because of the new models.

Builders say that once the market is better, homeowners who


invested and upgraded their homes with more expensive options
and have more architectural details will enjoy higher values even
with the new, less-expensive models next door.

``We may never get what we could have, with our houses having
these lower-cost homes next to us, Foster said. ``They are the
same square footage but are lower-quality.

Other builders are using similar strategies. Trend Homes, which


recently emerged out of bankruptcy, now uses vinyl instead of
wood for window frames and is putting in fewer windows if they
dont affect lighting.

Builders trying to sell houses in the slumping market are reducing


what it costs to build them by scaling back on architectural details
such as windows, stonework and cathedral ceilings. The savings
are being passed on to buyers.

The new models havent been built yet in Freeman Farms, but
Fulton Homes went to the Gilbert Town Council for approval on
the changes.

Once-standard features, such as additional cabinetry and smooth


stucco, are now options. Ironically, the reduced features translate
into more space in some models for the same amount of money.

Residents opposed the builder at the meeting, but the plan was
approved. Fulton Homes President Norm Nicholls did not return
calls.

The changes are a result of builders adapting to radically different market conditions. Houses that sold in 2005 and 2006 arent
selling as well now because many buyers prefer good deals to the
lavish features so popular in the boom.

``We love our house. We dont want to move, but we dont want
to be made fools of, said Teri Jaress. ``We feel like weve earned
what we have, and now its been taken away from us.
Wayne Balmer, planning manager for Queen Creek, understands

Builders are trying to get their house prices down from well over
Business Opportunities Journal

48

same type of house? Balmer said.

residents plight. Even one subdivision that deviates from a neighborhoods plan can cause property values to fall, he said.

One of the challenges Mesa is facing comes from the high number
of less-expensive houses in the city, said Balmer, an authority on
urban planning in the area. The houses attract first-time buyers,
who live there temporarily and then move on, which can affect
schools and peoples participation in the city.

And the long-term vision of a community can be at stake. The


houses built today have the potential to be there 100 years, so a
cheaper product can affect a municipalitys viability.
``Will it be seen as a good long-term decision to change the developments standards to a plainer-looking house or better wait
a year or two until the economy turns around and then build the

Less stable neighborhoods also have an impact on sales-tax collections and the ability to pass bonds in elections, Balmer said.
Queen Creek would like to maintain its second-time home-buyer
niche because thats the house people usually settle in for a long
time.
``They need to ask, Is it a neighborhood that will stand the test
of time positively and be an asset to the community? `` Balmer
said. ``Or are we having an area of the community that wouldnt
maintain the standards wed like to have?
Now more than ever, buyers are in the market for a deal.
``Most people are trying to find the best and biggest bang for their
buck, said Sabrina Porter, vice president of sales and marketing
for Trend Homes. ``Most customers want a good-sized home. They
want it to be beautiful with architectural details at a low price. As
a home builder you just have to decide what are the most valuable items for your customers and try not to do away with those.

Oahu office vacancy rates to climb higher

AP Wire Service

HONOLULU (AP) _ One of Hawaiis largest commercial real


estate firms is predicting that office vacancies in Oahu will climb
higher this year.

The cause of the higher vacancies are


closing or shrinking companies, weak
business confidence and rising unemployment.

Last year, the vacancy rate settled at a bit more than 7 percent. A
report by Colliers Monroe Friedlander estimates that figure will rise
to more than 8.5 percent this year.

Shidler noted that a recent report from Merrill Lynch Research


determined that Honolulu is the second healthiest office market in
the country.

That is the equivalent of almost 140,000 square feet of empty space.

Jeffrey Hall, in another study for CB Richard Ellis Inc., described


the citys commercial real estate market as ``relatively unscathed
by the turmoil afflicting such markets in other U.S. cities.

The firm predicts the vacancy rate will rise to 9.5 percent next year,
the equivalent of an empty 13- or 14-story building.
However, anything below a 10 percent vacancy rate is considered a
normal market and not likely to cause alarm. The rate in 1998, for
example, was 14 percent, and in 2006, it was 7 percent.

While vacancy rates are on the rise, rents have slightly increased
in recent years. Full-service gross rent last year rose to an average
of $2.84 a square foot, the result of higher operating expenses for
common areas.

``Its not the end of the world, said Jay Shidler, chairman of Pacific
Office Properties Trust Inc., which owns seven Honolulu office
buildings. ``I think were in a period of steady uncertainty, where
nothing dynamic is happening. Were OK.

Still, the Colliers report expects rents to drop a bit and landlords to
offer more concessions this coming year as owners look for ways
to hold onto current tenants and attract new ones.

49

Business Opportunities Journal

REAL ESTATE OPPORTUNITIES

Tough times can turn homeowners into landlords


When Dave and Gina Schudi of Phoenix went house hunting last year, they
knew the time was right to buy --not
sell --a home.
So when they did purchase a new one,
they rented out their old home.
``It all depends on the market, said
Dave Schudi, who plans to sell the old
house eventually. ``Weve got good
renters in there.
Falling house prices and a slow market
are forcing more homeowners to consider renting their properties.
Its something Tampa, Fla., Realtor
Julia Vakulenko suggests to potential
clients.

By MELISSA KOSSLER DUTTON


For The Associated Press

value.
For many, the role of landlord is something theyd never considered. If done
right, however, renting out a home can
help the owner ride out the housing
slump, said Vakulenko, of Tampa4U.
com. But the process does require
doing some research, said Vakulenko,
who owns five rental properties.
She often refers clients to property
management companies who can determine what their home would rent
for and whether theres a market for it.
Homeowners are often disappointed
to learn that their home would rent
for less than their mortgage payment,
added John Nuzzolese, president of
the Landlord Protection Agency in East
Meadow, N.Y.

``Basically, we ask all the people who


contact us, Must you sell it right now?
she said. ``Most likely, it will just sit ``Whether its for sale or for rent, its
there or maybe sell below the market only worth what people are willing

Business Opportunities Journal

50

to pay for it, he said. ``People have to


be realistic and put themselves in the
tenants shoes.
Real estate analyst Danielle Babb often
sends people to www.rentometer.com
to see what the going rent is in their
area. The Web site allows users to see
what comparable properties in the
area charge.
Once youve set a rent range, determine your demographic --students,
families, young professionals --and
market the house to them, said Babb,
author of ``The Accidental Landlord
(Penguin Group, 2008). Babb, who has
owns 27 rental properties, wrote the
book after watching friends and colleagues trying to rent out houses they
couldnt sell.
``Youve got to think like a renter.

Theres lots of availability, she said.


``Theyre going to choose the most
exciting option.

Consider asking about pets, smoking


and employment, for example.

paying rent.
--Perform a walk-through of the property with the tenant before he or she
moves in. During the walk-through,
make notes and take photos of any
property damage such as chips in the
tile, spots on carpeting, etc. You and
the tenant should sign the paper as
an acknowledgement of what condition the property was in at the start of
the lease.

Babb, Nuzzolese and Vakulenko offered the following suggestions for


homeowners who are considering
renting their home:

--Ask for references. Call former landlords and ask about the persons rental
history. Verify that the references listed
are really landlords and not the applicants friends posing as landlords.

--Familiarize yourself with local laws


dealing with rental properties. Its
important to understand the eviction
process, how to handle security deposits and what type of access you have to
the property once its rented.

--Screen potential tenants. Once youve


narrowed your field of potential tenants, hire a service to run a criminal
and financial background check on
the applicants. Be wary of tenants with
previous evictions or bankruptcies.

--Determine whether you want to


select the tenant and handle property
issues or hire a company to do it. If
you take on the responsibility, you
are obliged to fix any problems (leaky
faucets, broken furnace, etc.) or find
professionals to do it.

--Consult with an attorney or the


Landlord Protection Agency, www.
thelpa.com, before writing a lease. A
well-written lease is crucial to protect
your property. It will help you evict a
tenant or hold them accountable for
damage if necessary.

--Check on the property. Drive by at


least once a month and look for signs
of trouble such as garbage in the yard,
extra cars in the driveway, or excessive
wear and tear. Make arrangements
to walk through the property three
months into the lease to see how well
the tenant is caring for it. (Make sure
you give the proper notice required for
entering the property.)

--Develop a rental application. Ask


questions on the application that will
help you quickly determine whether
you want this person for a tenant.

--Collect a security deposit equal to


one months rent. This will help cover
any damage to the property and protect you if a tenant moves without

--Do not accept partial rent payments.


Accepting money from tenants who
are not paying the full rent can make
it more difficult to evict them.

51

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