There are many benefits to owning a franchise business. One that you should be taking advantage of is the knowledge and experience provided by your Area Representative if your franchisor has them as part of the executive team. The Area Rep may be one of your most valuable resources in terms of helping you to build a truly successful franchise. Ruben Trevino, Area Representative with Always Best Care Senior Services in New Jersey, joins Jeff Allen to discuss what he brings to the franchisees he works with on a daily basis to help them overcome challenges and build the best franchise business possible.
Do things the way we expect it to be done in order to provide strong, quality service to our clients.
- Ruben Trevino
Jeff: Tell us a little bit about Always Best Care Senior Services for those people who may be hearing about your company for the first time.
Ruben: Absolutely. Always Best Care Senior Services, we've been in the business of providing home care and assisted living referral services to folks since 1996. That's when the founder Michael Newman started the business. And since that time, 2007, began franchising the concept. We're up to about 189 locations last time I checked and 115 franchisees throughout the US and Canada.
Jeff: Okay. So your company is up and coming and it's really been built on really a platform,apillar of success. Your company is thriving right now. Let me know a little bit though about you Ruben, your position as an area rep. Tell us a little bit about what an area rep does and what you do in particular.
Ruben: What I do Jeff is go out and look for prospects. What I as an area rep have done is purchase the rights to develop the area, made of an investment with the franchisor, always Best Care, that allows me to go out and find candidates who want to have a successful business providing home care aid in people's homes and also finding the right assisted living facility for people. What I do is find those candidates, bring them in and if they pass our criteria and they actually awarded a franchise -- we typically don't use the term selling franchises although that's what most people think of. We award it because if someone isn't willing to follow the process, the model, the operations manual, and do things the way we expect it to be done in order to provide strong, quality service to our clients then we don't award that franchise, that particular territory to them. So a lot of my time is recruiting and finding those candidates. And once they come into the business I train, coach, support, and mentor them. I am their local support for whatever their business needs are, and to a lesser extent, but sometimes I get dragged into it, I become their sounding board for personal issues. Because when you become a business owner, Jeff, you know it's not easy to separate your personal life from your business life so you need help at every turn. And here I'm not a counselor but I end up helping people with whatever they need to make their franchise successful.
I'm not a counselor but I end up helping people with whatever they need to make their franchise successful.
Jeff: And this is really a different kind of business. It's not your typical franchise, auto parts, fastfood, and things like this, this is the kind of business where character truly counts. So your first job is really to kind of vet those individuals before bringing them on board to make sure that they really measure up to the high standards of Always Best Care. That's kind of your first job. And then of course you talk about once they're on board you really are kind of their support mechanism as much as you are their coach. And being able to provide them with I think you said, kind of that sounding board that they need to help them be successful and kind of meet their objectives and their goals.
Talk a little bit more about that relationship that you have. You're kind of that guy that corporate really relies on not just to get people trained up but also to the franchisees, the people who own those businesses, and many times go into those homes, the guy that they rely on to help them kind of moving forward. That's a heavy responsibility to be able to answer to both sides like that isn't it?
Ruben: Yes. Sometimes I'm squeezed between the franchisor and the franchisees, and that's okay. That's what I signed up for. My customer primarily though, he's the franchise owner who’s out there rolling up their sleeves and getting dirty. They're working. They're the ones that are up before dawn. They're staying out late. They're working a lot of hours, depending on the way they structure their agency. But in the beginning with any new venture, any new business you're going to put those hours in and I'm here to support, coach them, “What do you need help with?”They're my customers so I want to hear what they need help with. Because I can't know everything about everything, I will find the resources that they need to be successful. It just gives the function of what they need and you're going out and locating that resource for them. And that resource can come from any field. It might be something in the deep IT. I have an IT background. I can help people with technology to an extent. It might be in the area of accounting. My wife's a CPA. I have a background in auditing but I don't know everything about everything. So being on site with them, this is the biggest advantage that they have with an area rep. They have someone here that can get in a car and be in their agency within 45 minutes. That's an advantage of me having the territory I have, Northern New Jersey. I can be in anyone's agency within 45 minutes. Some are even closer. That's the beauty of the system and the setup we have here.
Jeff: And with all that of course you've got your two decades in experience in business, so you have really a depth of experience that your people can take advantage of and help them prosper. Why would a franchisor, Ruben, choose to have area reps? You've talked a little bit about what you do and what an area rep is but why is that advantageous do you think to Always Best Care to have that kind of model in place where an area rep is really instrumental in helping them grow?
Ruben: Deciding if there will be area rep model is a very strategic decision that the franchisor needs to make, and they're willing to really trade off future royalties because the way that I'm compensated is that 50 percent of the royalty stream that comes in comes to me. The advantage to the franchisor in the beginning is that they're going to be collecting hundreds of thousands or millions of dollars from each area representative in order to buy the rights to develop an area. So that's the advantage to the franchisor right up front. With all of that operating capital early on as you know Jeff for start-ups, typically getting that money, they're cash poor in the beginning so this gives that infusion of capital and they can ramp up quicker than competitors.
They're cash poor in the beginning so this gives that infusion of capital and they can ramp up quicker than competitors.
Jeff: Go ahead Ruben. If you have another thought go ahead.
Ruben: Yeah. In addition to that typically they can run with a leaner staff in the corporate office. So they don't necessarily have to have as many folks there because the inside trainers that -- if you were administering or trying to support an entire franchise system out of one location you would need quite a few inside trainers to coach and mentor the franchisees. Here with the area reps, and there are 22 of us right now, that allows them to have leaner staffs in the corporate office.
Jeff: I see, very, very good. Is there a difference between a master franchisor and an AR in your opinion Ruben from what you've seen in your decades of experience?
Ruben: Yeah. From what I've seen typically you're going to see the master franchisor. You can have them Stateside but for international launches, as a matter of fact Always Best Care has a master franchisor arrangement to go to Chile, to go to I think Brazil, Germany. That's where the difference, and I've always sort of started with that first step is that they contract with the master franchisor. Whereas with me with the area rep they still contract with the franchisor, not with me. So I'm technically a franchisee that has contracted as well with the franchisor. It's a minor difference, it's a technical difference there but we basically do the same thing, the master franchisor or the area rep.
Jeff: Now, let's go ahead and let's shift to maybe a day in the life of Ruben Trevino. Maybe you have someone that you've brought on board. A brand new franchisee, and this is someone who is really, really interested in putting their best foot forward and really making a great go of this business. They want to be profitable, they want to grow their business quickly, and yet at the same time they want to provide the best care. What are some of the things that you suggest, or the things that you talk about with your franchisees, with the people that you bring on board about ways that they can truly affect their business in a positive manner from the beginning to help kind of build their business up and really build value in that business from day one.
Ruben: Why don't I start from the beginning, initially working with a candidate. At that point, remember I said franchises are awarded not sold. I'm vetting that candidate to understand whether they have the right make-up to be an Always Best Care franchise owner. And I’m going to ask questions about what it is that you want out of this business? What are you trying to accomplish? And I'll tell you right now Jeff, in this business if all they want to talk about is dollars and cents, all they want to talk about is profitability, all they want to talk about is how much money they can make, they are not typically a good Always Best Care candidate and a franchise owner. Don't get me wrong. I'm not saying we don't have people who are making money and I understand we're in business to make a profit. However, as you mentioned earlier that selling chicken or these types of transactional businesses, we're not that. I need to understand what it is they want from this business. And also what is it they're willing to put into this business to make it successful. So if you come to me and you tell me, "I kind of think I might want to perhaps do this business ",no, that's not going to be a good fit. I have to know that you have a passion for this business, that you're going to get up in the morning early to start planning for your business success, that you want to do this business. And if you don't then this is not a good fit for you. There are a lot of other franchise businesses out there, I’m not knocking them. I'm not saying that selling ice cream is not a good business. All I'm getting at is this particular business, the owners that are successful in this business have the passion, the drive, the fire, the love of the business. They really want to help seniors. They really want to do something in the community. It is a business that they want to talk to their families and their friends about. It is just that thing that you feel when you're talking to that person on the other side of the table, and by the way, I meet with them in person before they come on board. And it's not just a discovery day kind of thing where they fly out to the corporate office and meet with the corporate staff. No. They meet with me and as a matter of fact they meet with my owners. They talk to them in person and determine whether or not this is a business for them. And once we've got an agreement that this makes sense for them and it makes sense for Always Best Care, then we bring them in. Then all of these other things we were talking about, a day in the life of that owner. So we've already kind of determined what it is they want out of this business. So when they start building their business plans I'm there helping them to put together their plan that is unique and customized to what their vision is for their business. Because as a franchisee you are an independent business owner, you own your own business and you run it as you see fit as long as you're within the boundaries and the guidelines of the operations manual and you're following those types of general guidelines that you need to follow. I'll take a pause there to see if there's something else that I can add later.
I have to know that you have a passion for this business, that you're going to get up in the morning early to start planning for your business success, that you want to do this business. And if you don't then this is not a good fit for you
Jeff: We are going to have to, as a matter of fact we're going to have to take a pause right now Ruben. We need to take a quick break. We're going to come back. We're going to talk to you a little bit more. I think the point here is that not all franchise businesses are alike. However, in any case, when you are a franchise business owner it is important to know that there are people behind you that you can use to your best advantage, to help you along the way. Ruben Trevino is one of them for the company that he works for, Always Best Care Senior Services, Northern New Jersey. My name is Jeff Allen. Deal Talk is coming right back so stay there.
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Jeff: Welcome back to Deal Talk, I'm Jeff Allen with Ruben Trevino, area representative from Always Best Care Senior Services in Northern New Jersey. Ruben, again, it's good to have you on the program on this edition of Deal Talk. You are not just someone who helps people get started with their business, but also to your someone who with Always Best Care stands by people, stands by your franchisees at all levels, at all stages through their ownership and their operational process, running their business. And that means you also get involved in other ways, and that includes helping them prepare for the eventuality that they may sell their business down the line. And so many of us are interested in ultimately doing that and doing so at a nice profit at some point down the line. Tell me a little bit how you're involved with your franchisees and how you help them to do that.
Ruben: That's a really important topic you just brought up, because succession planning, not everyone wants to be in business doing the same thing forever. Things change in their life too where they may have a situation that requires they maybe have to relocate or maybe after they do this business for a while they finally want to do something else. And that's okay. Nothing wrong with that. I've helped three of my owners transition out. And they sold their business to some of them outside third parties and some of them internally to other franchise owners. And what I tell them is the same thing that when I bought my first home, Jeff, many years ago I remember the real estate agent telling me a lesson there which is the best time to think about selling your home is when you're buying a home. And so what I tell my owners is the best time to think about the value of your business and how much it's going to be worth – because it's not just the cash flows that come in today but also disposition, when it's time to hand it over to someone else, what is that business worth. And that value is going to be determined in how you’ve set that business up. So abusiness,what I'm getting at here Jeff, is a business where the owner wears all the hats. The owner is for example doing the payroll, recruiting the caregivers, they're training the caregivers, they're doing the marketing, they’re wearing all the hats. That business is not as attractive even with a certain cash flow asit would be for someone who has a turnkey operation where they have personnel and staff that are trained, they have processes in place that are well-documented and they're trained on. That is of greater value at the time of disposition. I also find it's lower stress to the owner. They have much less stress when they have people and processes in place that can run that business and put it on autopilot should they have to sell, it's much more attractive for someone looking at that business a day down the road.
Because succession planning, not everyone wants to be in business doing the same thing forever.
Jeff: It's all about preparation and a lot of that is mental preparation. And when you have that mental preparation in place like you talked about, there seems to be less stress, less anxiety. Have you found when you talk to people about that for the first time and you approach them about that that there is kind of maybe a lack of familiarity, or a lack of readiness, or maybe a lack of knowledge for that matter Ruben about what it is that they want to do. Or they perhaps haven't even given it any thought up to the time that you start to speak with them about this. I guess I'll put it another way. Do they typically come to you to ask you about this before you approach them about their future plans to hold on or eventually pass that business along?
Ruben: That's very interesting because in the beginning, when I first got involved in franchising I thought just like when you get married, this is going to last forever and no one will ever want out. Now I've been married now 16 years with the same wonderful woman and it's still my first marriage. But the reality is that sometimes things change, right? And so in business -- I got caught kind off off-guard the first time this happened to me. And so I built that in to the award and betting process to make sure that we're having these discussions early on so that they can start putting together a business that is attractive, so if their needs, or wants and desires, or their family circumstances just change dramatically where they are putting that business up for sale down the road. I start having that conversation early with my owners and it's part of what I’ve now been doing now for the last three or four years to have to make sure that they're not caught surprised as you just mentioned. I think surprise is for disposition of the business not good. I want them to have a plan and it's part of the valuation. When we look annually what your business is worth, it's not just the net present value of your cash flow but also what is this series of cash flow in this business worth to someone down the road. So we look at the whole picture.
Jeff: Ruben Trevino is an area representative with Always Best Care Senior Services. Ruben as we get into the home stretch of the program, I'd like to kind of back away just a little bit from talk of maybe specifically you’re working with Always Best Care and with your people. Now I'd like to appeal to the business coach and that mentor with the two decades of business experience that you have, having worked for franchise business-oriented companies. What recommendations do you have for a business owner who's considering buying a franchise business for the first time? Maybe they're already currently a business owner. They own their own independent business, wholly owned, or maybe they're considering getting away from corporate America and buying their own business, and they want it to be a franchise business. Any thoughts, recommendations, input that you might have?
Ruben: Yeah. For people that are looking to buy a franchise what I tell them is find a concept. I've got friends and family who are looking to go to into business for themselves. One of the things that I do recommend is that they look, especially if they have a corporate history, their history is in corporate America, they say that corporate America is entrepreneurial, and I used to say the same thing, Jeff, but boy, when you are an independent business owner, then you find out with being on your own and being an entrepreneur...
For people that are looking to buy a franchise what I tell them is find a concept
Jeff: Where the rubber hits the road as they used to say.
Ruben: Absolutely. And so what I tell people is first, at least look into maybe a franchise operation especially if it's something that you want to do that isn’t invent a new app or some business like that. Finding that aligns with your value system. What is your personal value system? What is it that makes you tic? Again, what is it that makes you proud, something, a business that you'd be proud to tell your friends and family about. Probably the biggest advice I could give someone is speak to current franchise owners. You're about to plunk down tens or hundreds of thousands of dollars into a franchise system, into a business, speak to them. And if you can speak to them in person even better than just on the phone. And if you can shadow the min the field or in their place of business do that, and really get to understand what it is that this business involves.
Jeff: Ruben, let me ask you, in your travels and the circles that you have been involved in and all the work that you've done with Always Best Care, and we can go beyond that of course. Are there any hurdles or any challenges that are specific to a franchise business that people should probably know about going in. This is something you're going to run into from time to time, or you could run into it, not necessarily everybody does. But is there anything that you remember from your past history working franchise business that you'd like to go ahead and share with people and kind of let them know, "Look, this is what I learned and this is something you could probably learn from."
Ruben: Yeah. I would say that the biggest things I think for franchisees is when you first get on board you want to follow the model. You want to follow the model of the franchisor before you start collecting and fixing because this thing is proven. And it may not make sense to you right out of the gate. You maybe sitting and scratching your head and wondering why am I doing this. In the beginning you have to have some faith that the model is going to work for you. And the challenge to me is I've got people reengineering the model before they even try it. For example I've had people telling me, "I can do this entire business on the web. I can set-up a digital marketing campaign, SEO campaigns, you name it, I can do that. And I can do it all behind the beauty of my walnut conference table or desk." And it's not so. That's not this business. That can be a bit frustrating sometimes. You just have to in still a faith that these guys are going to guide me in the right direction.
You want to follow the model of the franchisor before you start collecting and fixing because this thing is proven. And it may not make sense to you right out of the gate
Jeff: Ruben, I know that you're obviously a very busy guy and I want you to get back to your family and also your business there. I appreciate you taking the time out. One thing that we need to point out about Ruben Trevino, this guy is the real deal. A Lean Six Sigma Black Belt Project Management Professional, experienced, spends both US domestic and international venues. You can read more about Ruben Trevino at franchise with alwaysbestcare.com and you can find him there. Ruben, if by chance someone has some general questions for you and they're interested in reaching you just to kind of ask you a question about operating a franchise business. They might have some questions about Always Best Care. How can they reach you specifically to talk to you about their particular question?
Ruben: Yeah. They can call me, 877-667-8990. That would be a start, and additionally they could just email me at email@example.com. And in addition to being an Always Best Care Senior services area rep I'm also a mentor with SCORE. SCORE, it's free small business advice that...
Jeff: Fantastic too.
Ruben: Yeah. You're familiar with it?
Jeff: I'm familiar with it. I was just going to say I'm a business owner myself and I've had achance to talk with people from SCORE when I was starting out, and it's really just an invaluable free service in most communities across the country and the fact Ruben that you're involved in that, that is just fantastic.
Ruben: Yeah. And I just thought to mention that because, yeah, call me. I can maybe help you if you've got ideas for the business, you need somebody to help you out with your business or something like that. Or as Jeff just mentioned SCORE's also an extremely valuable asset that's probably available to you and your community.
SCORE's also an extremely valuable asset that's probably available to you and your community.
Jeff: Very, very good. Ruben Trevino, it's been a pleasure. I sure do appreciate all the time that you've given us today. Thank you for being a guest here on Deal talk. And maybe we can have you back on again another time?
Ruben: I'd love that. Thank you Jeff.
Jeff: Ruben Trevino, business coach, mentor, and area representative for Always Best Care Senior Services has been my guest today.
Deal Talk is presented by Morgan & Westfield, a nationwide leader in business sales and appraisals. If you're thinking about selling a business or buying one call Morgan & Westfield today at 888-693-7834 or visit morganandwestfield.com. And for more valuable information and insight from our growing list of small business experts make sure to join us again here on Deal Talk. I'm Jeff Allen. Thanks again for listening. We'll talk to you again soon.