Multi-Unit Franchisees Wanted for Nationwide Expansion

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MULTI-UNIT FRANCHISING FEATURE COVER STORY APRIL 2016

One Washington, DC area discount dry cleaner is targeting nationwide franchise expansion, but it’s not content doing that one store at a time.

ZIPS Dry Cleaners, which charges a flat rate of $2.29 for any garment, has been in business for 14 years and franchising since 2007. The company is looking for experienced operators of other multi-unit concepts, vice president of franchise development for ZIPS Aaron Goldberg explained during a recent interview from the company’s headquarters in Greenbelt, MD.

Whether their experience be in food, hotel or fitness centers, franchisees who are interested in joining ZIPS should have firsthand knowledge about dealing with multiple franchise locations and should be willing to make a multi-million dollar commitment on a multi-unit deal in a new market.

The minimum number of franchise units a new franchisee would have to be committed to is either five for a small market or 10 new for a larger market.

Faster expansion and the ability to attract a more sophisticated type of franchisee were the main reasons behind targeting multi-unit franchisees, Goldberg said. ZIPS wants franchisees who will be responsible for their own operations management and development after they’ve received the right amount of support and training from the company.

“The logical pattern for growth is to sell territories at a time and to be able to have some cohesiveness in marketing operations and development within a territory,” the vice president of franchise development said.

The ZIPS Difference

What sets ZIPS apart from other dry cleaners is its ability to offer an inexpensive flat rate while also providing customers with the best customer service in the industry, Goldberg noted. Plus, the company uses an eco-friendly process for its dry cleaning, which is attractive to customers.

“Everything is done with a price that is reasonable to the consumer with full transparency of the entire process,” Goldberg said.

With one corporate location and 41 franchise locations currently open and operating throughout the Mid-Atlantic, the company has another six locations under construction and hopes to add another four on top of that for a total of 10 new locations operating by the end of the year.

Right now, ZIPS is concentrated in the Baltimore-Washington area, but is doing a lot of development in Pennsylvania, specifically Philadelphia.

The goal is to expand outward from Washington, DC, but the company will go beyond that area if it’s confident that it has found a good franchise partner in another area of the country.

Currently, ZIPS has finalized an agreement with a developer to open over a hundred stores from Philadelphia up into parts of New York City. They’re also in discussions with a group from Pittsburgh and South Florida for possible development agreements. Ongoing Area Development awards are pending with groups from Southern California, Central Texas and Maryland in-fill for an additional proposed 149 store commitments. Goldberg estimates there will be approximately 300 commitments by the end of 2016.

“It’s quite a remarkable accomplishment for ZIPS, but more so a testament to the demand for the ZIPS concept by savvy investors and the services ZIPS provides by US consumers,” said Goldberg.

The rapid, nationwide expansion is a long way from where ZIPS started. The first ZIPS locations were actually owned by eight dry cleaning operators of a different brand. They broke away from that other brand and started their own company, rebranding their stores as ZIPS in 2002.

Eleven years later in 2013, the company experienced a majority acquisition by the private equity firm JBP Partners out of Columbia, MD and it’s been growing quickly ever since.

Training and Support

ZIPS requires a franchisee’s district and/or store managers to attend a 10 week training program at ZIPS headquarters. Training is provided in dry cleaning production, customer service, maintenance and repair of the equipment and everything else that an operator or a manager of a store would need to know.

For the final few weeks of the aforementioned training, ZIPS boot camps the trainees to run an existing store and act as the de facto manager.

Once a franchise store is open, ZIPS comes out and performs certification of the store manager to ensure they are fully trained.

Every franchise location goes through a franchise performance review cycle where ZIPS representatives visit the stores and do a 370-point inspection. The first year a store is open, they do inspections monthly and then depending on operations, they do it quarterly, every six months or annually based on how well the store does in prior reviews.

Training materials include online video training, customer service training, and operational training for every process in the business. There are bilingual job aids at all the stations and a comprehensive operations manual to go along with six-day telephone support via 1-800 number for franchisees.

The company is also working on a system that will allow multi-unit franchisees to easily keep track of what is happening in all their stores at the same time.

For any franchisees that have experience running multiple units, ZIPS offers a prime opportunity to add to a portfolio.

www.321zips.com