Episode Transcript
[00:00:00] Speaker A: Welcome to Create Wealth Through Franchising. I'm your host, Kim Daly.
Whether you're a CEO, a military vet, a real estate investor, or simply in career transition and ready to take ownership of your future, with each episode you're going to learn valuable insights and hear inspiring stories from within the franchise industry.
On that note, my guest stories are their own. And as a franchise consultant, I do not make personal brand endorsements or earnings claims, but I do educate, motivate and inspire dreams.
Now onto the show.
Welcome back to Create Wealth Through Franchising podcast and Kim Daily tv. And my special guest today, another salon suite franchisee. Please welcome to the studio, David Asheim from Richmond, Virginia. David, welcome to the studio of Kim Daly tv.
[00:01:02] Speaker B: Happy to be here, Kim. Thanks for inviting me.
[00:01:04] Speaker A: So this man owns 13 soon to be 14 Sola Salons. So we're gonna start at the beginning of that story. David, I want to know what you were doing in your life when you answered the call to become a business owner and you landed on Sola.
[00:01:21] Speaker B: First of all, I think it helps if you know that I'm, I think I'm the third franchisee that didn't know the founders before they started the business.
[00:01:27] Speaker A: I even knew Stratton, by the way.
[00:01:29] Speaker B: Yeah, I, Stratton and Matt were literally a year and a half into Sola and just starting their to franchise it through their brother in law who has the Southern California markets. And I went to business school in St. Louis at Washington University. And one of my classmates married a woman who used to babysit for basically the founder's nephew essentially. So when they moved to Denver, they were invited to a party, heard about Sola, brought it back to a bunch of us who were very close at business school. And three of those people wanted to do Sola in Southern Florida. I wasn't living in Richmond yet. I moved here in 2007 and I just kind of kept an eye on what they were doing and they were having a lot of trouble doing it. They didn't live in that market at the time. I was doing consulting. I had been working for Deloitte and then I broke off and had my own practice where I was doing a lot of the same kind of consulting at Deloitte, but doing it for myself. So I was running around, I was a friendly for the partners. The partners knew I wasn't, you know a little bit about it. Sarbane, Vox, lead out. I was not conflicted, so I was able to go into these customers. So within about a week of leaving Deloitte, I had seven clients, and I grew it to about 12 or 15 clients over the period of five years. But I knew that that was going to wear out. So I was looking and looking and looking for something that could be more stable, and then I didn't have to leverage my own knowledge all the time. And that was really the hard part of being an independent consultant. So I either had to join a bigger group or find some industry I could do. So as I watched these guys look at the Sola concept and they were looking at the time in South Florida, I moved to Richmond and I thought this would be perfect here. So I kind of checked in and said, you guys doing anything with this? And one of the guys who became my partner, who was a good friend of mine from school, said, you know, it really died. And we went off and approached corporate and joined Sola back then. So I was really an accidental franchisee. I was just looking for great business ideas. Of all the things I looked at from 2005 to 2007, this was the best idea I could find.
[00:03:30] Speaker A: This is the greatest idea. If you ask him, Daly, like the day that I met Stratton Smith and he told me what he did, I was like, you do what? And that's a franchise. And I hand delivered him to one of the best franchise business development people that I know. And the rest is history. For solo salons, like, I take a lot of credit for that because I couldn't believe this was a thing. So for those who are not in the store yet and you haven't, maybe this is the first podcast you're listening to because clearly I've interviewed a lot of people who own salon suites. A salon suite is. David, why don't you share with the viewers what your franchise business model actually is at its core.
[00:04:06] Speaker B: I describe it very simply as, you know, we work for beauty professionals, so we are providing independent operators in the beauty space, primarily hair. We've defined doored studios also in the industry called suites, where they have their own shampoo bowl, their own storage, their own lock and key, and they can service and run their own business without the overhead of the real estate, without the capital investment. Really a turnkey environment for those people who have built their own businesses but yet feel limited because the option of going to a big salon and having to have partners or having to make the investment is either out of reach or something many times that they did in their past and now want to move to something simpler.
[00:04:50] Speaker A: So it's a real estate play with business, cash flowing returns, guys and gals out there. This is one of the slickest franchise business models. Now, David, you have, I think you said 13, 14 locations coming. How many employees do you have total?
[00:05:04] Speaker B: So I've drawn this into 11 or 12 person business. Really. If you had met me, and it'll be funny if any of my old friends watched this from the years past, but I was accused of many years ago in the first three, four years of Sola, where I've had experience in business, but really got a chance to be the guy in the room with people 10 years older than me learning how they were doing business. And so I was very hands on. And 10 years ago, you would never have imagined that I could have distributed the responsibility of this company out. So now we are 12 people. We have two directors, we have manager. We separate into operations and we separate into sales. We have a technical team which goes in and do all the technician work. So just like any real estate environment where we have fix it guys and technicians all the way up through accounting and finance. So really growing this into a company where I love being in the salons, but my role isn't in the salons anymore. And that's been a very enjoyable change in my life because I spent 12 or 13 years of the past 15 really focused on being on the product.
[00:06:08] Speaker A: Good job. Taking on that growth. That's awesome, David. So for those who, again, who are listening, the Swansea model is like zero to one employees per location. He's at scale, so that's why he has a whole team of people. But if you were thinking about how do I get started in a salon suite? You don't start with all those people. You start with the building and yourself and maybe one employee.
[00:06:30] Speaker B: And that's a great point, Kim, because I think when we started this business, I mean, everything from I had to learn how to crimp wire for low voltage to put lines in people's studios. I had to learn how to do simple plumbing, which I knew some of already, but, you know, from renting my apartments. But the thing I say the most that I love about Sola, especially in the early years and it continues today, is it uses every muscle in my brain. And I think that that was what was so exhilarating. Because in one level, you're doing community service, you're doing relationship building, you're doing interacting with individuals who really are representing perhaps the largest income earner in their household. And then on the other hand, you're doing finance. You're trying to get money going, you're trying to get deal with issues with landlords, you're dealing with issues with utilities, you're trying to get teams on board to do things they need to do. So it's a really exhilarating business. And you fast forward to today. I have had to learn how to separate myself from those activities. And you can do it, but if you want to start in this business, you have to be ready to commit that the people there are going to rely on you. And that's a really wonderful relationship. It was part of this business. I never expected of really understanding that we're putting food on people's table in a very new way. And that was great as we were disrupting the industry.
[00:07:41] Speaker A: So he is renting space to typically beauty professionals. That's what he said. And so he's collecting weekly rent. And what he's saying is that they're relying on him. Right. So they need their space to work efficiently and effectively so they can run their beauty. Whether it's a hairstylist or some other kind of beauty professional, maybe a lash artist or what else do you have in there?
[00:08:04] Speaker B: Primarily, it's going to be hair. But we have a lot. Braiders was a big thing when we started this. Braiders don't have places to go because they don't really work in salons and they don't like to go door to door. We also had a bunch of massage. We have micro threading. The industry is moving in other ways. Or some restrictions, like tattoo is often difficult because of the fact that local zoning laws restrict it. I've seen anything from people having just pure retail to someone had an accountant in one of his places. But that's not really our model. Our model is to support wellness and beauty. And, you know, the challenge of the other services is, as we know from COVID you know, people still needed to get their hair cut, but they might wait on a massage. So that's a really big thing. But we are welcome to anybody in the industry and we believe that by creating a hub of activity around beauty, it's great because you can get your nails done, you can get your hair done, you know, and a lot of times that's not going to be in the same day. It's going to be, you're going to come back to the place because it's convenient and because you appreciate the building and you appreciate the facility, which is going to be really effective for the other agents and the other solar stylists, we call them pros, to be able to share those relationships and share those. Those leads and help the whole place be generating more income.
[00:09:15] Speaker A: Okay, so let's go back to why. So you invested in Sola, and you obviously love it because you've doubled down and tripled down, and now you're getting at number 14 from consulting to building out this sort of empire with Sola salons. Like, what is the appeal for you? What do you love most about this business model?
[00:09:35] Speaker B: I mean, what I said before about the fact that I like anything that engages my brain in multiple ways in multifacetets, I mean, a really tough story, which is, I think, a fun story in the way of success.
It also is part of the failure. We brought in someone very early who had a friend who was not a strong stylist. She was very strong. They took a double together in the experience with them and one being successful, one, not one. One of them really had trouble and was struggling at home. And so we had to go and approach her and find a way to actually move her out of Sola. And what it taught me was how connected we are to their success. And I know that's sort of a negative, but you had to go through that kind of crucible of realizing that we are responsible for people not just blowing their savings. And I think that understanding and ownership of the fact that our success is really driven from them succeeding, and we need to set them up for success every day that they're in there. So while I use that story when I've been asked this question, because I think it's an effective story, I hated going through it, but it really changed the responsibility and view of us as not just a landlord, because your landlord, you know, if your fridge doesn't work, you bring in some takeout, you can manage it. At Sola, if your sink doesn't work, you can't make money, and that hurts. So we need to make sure every day that our salons are going to be operating. And that's really what I love, is how much we're able to help our community and help the people that are in the salons to grow and prosper because they trust us, and we have to be that foundation.
[00:11:07] Speaker A: What I really love, too, is that taking your corporate background from consulting and coming in and really being as like a consultant to these beauty pros. I mean, it's a totally different level of mindset and business and all that, but at the end of the day, it's people helping people. Right? Run a better business. And so I see this kind of direct correlation. So for. For somebody out there who's thinking, like, what Skills do you have to have to own a solo salon? Right. There is no special skill that's required here, but I'm sort of making a connection for you to the idea that if you've been a business coach or you've been a consultant, you've been guiding other people in their businesses. It's a very appropriate skill set for the hands in the clay kind of model of a solo salon. So awesome. So, David, when you invested, did you invest with the vision that one day you would have all of these, or did you start with one and let it grow from there?
[00:11:58] Speaker B: We bought a four pack originally. So what was great about Richmond was Richmond's market. Back in the time when I can really say we were really disrupting the salon industry. Especially in those first five years, my partner and I really felt that four was doable. We hopped into a market that was scaled right. It wasn't like going into Washington or Charlotte where you had to commit to 10, 15 stores. We committed into this store with the knowledge growing now as we got through our third store. So the first store was a little slow, but it was very successful. Second store, I had people approach me and say, if you put one here, we'll help you fill it. And we were basically full the day we opened. So that thing was cash flowing right away and that became the engine of growth for the future. Growth including being able to buy more markets, buy out. Basically we own from central Virginia all the way to the coast and really being able to grow within our footprint really effectively. So did I think of what it would get to? Not in any kind of number, but I knew that I could drive this business and find success and I knew that we could build the relationships we needed to build in the communities we were working in. So that was really my focus and I felt the success and the financial rewards of that would come afterwards. And so far, so good.
[00:13:08] Speaker A: Hey, Daily Coach fans, if you're loving this episode, please do me a quick favor and leave me a five star rating and a short, short review. Your feedback fuels my growth and rankings and shows others that this podcast is valuable. Now back to the show.
I know in the beginning it's not really encouraged for you to own the building. A lot of people who look at this lawsuit model think, well, I want to own the building. I'm like, no, put the money in the business and double down on the business. Cash flowing return, not the real estate, because the real estate is its own investment with its own return. But I think as you grow substantially in these types of models, it makes sense at some point to start, you know, building your own building or at least owning, taking over the lease. Do you own any of the properties or are you strictly a renter in all of your locations?
[00:13:55] Speaker B: So there's two scenarios. One is, if you enter like I did in my late 30s, I wasn't in a position to own building, so we were leveraging as much as we possibly could. Having good relationship with banks, I probably got better lending than most people. But because Richmond's a pretty cool community in terms of the banks and the networking that we have here and the groups that I'm involved when have a lot of banking relationships, we've really been able to grow it organically from some debt and from growing it with some cash invested. I think a lot of the solo people I saw come in a little bit later were people who've done other things in their lives and they're transitioning into solo later. And I think those people who have the resources, if you can find the right property. Now, the trick is, don't want to give away too much of the secret sauce here, but the trick is finding the right properties, finding places where you're situating yourself properly, asking yourself, is it, do we need to be the first view at the stoplight, or can we be somewhere that is near the stoplight? And determining where that has to be the thing I used to get asked by my stylists, especially in some of our early locations. Obviously, like anything, even Panera, you can find old models of Panera back in the day that didn't have good sight lines and they were not even in great places. In those cases, I would say to my stylist, you know, when I can get the rent cheap enough that I charge you the same amount for being in the front of the center as I do in the way off in the corner, I'm going to get you that deal, but it's going to depend on what I can charge them, not otherwise. So if you can still get a building and buy it and keep the rent affordable to the person who is paying you, you're going to thrive. But if you pay up too much and you're in a spot where you have bet on location over value, you might not necessarily have the fill as fast as you'd like and you need.
[00:15:35] Speaker A: To leave cash because it's a business and it needs cash. So this is a great segue from you though, into my next question. So a lot of times candidates look at a very simple model, like a Sola Salon and say to me, well, why do I need a franchise for that? So can you speak to a little bit about the advantage of your partnership with Sola compared to if you had just gone out and tried to recreate this model completely on your own?
[00:16:01] Speaker B: I had no idea how to build the cabinets. I had no idea how to structure and set up the doors and things. And I've seen the mom and pop show up that are doing exactly that, not working with a franchise or. And I think very few of them really get the traction that they think they're going to get. They just aren't able to leverage the Internet stuff, the marketing, the equipment, the design.
I think it's a slower. Slower slogan. I mean, sure, I know how to do all that now. And there are times that I say, you know, yeah, do I need the franchisor? No. But then the franchisor comes out and does a new webpage. So the franchisor comes out and does more on the global brand and marketing approach of Sola. And I think those are things I don't want to spend my time on. And so while I am an accidental franchisee, I've really learned that this is a partnership and with them. And I was actually recently asked about this. And I played soccer at University of Rochester. I played doubles in tennis. I love a team sport. And the other benefit of being part of Sola is we have a whole big group of franchisees. We form an association as well, which is not about things with a franchisor. It's really about the things that we can do alone and together. And the franchisor supports us. They come to our meetings, they talk to us about stuff. So lots of ways to exchange and grow, and you'll never get that as an isolate. When I was an isolated consultant just running my own little firm, I couldn't be up on the latest things. I could teach what I knew, but I couldn't go and know the next new trend that was happening in accounting or finance. And so that's where I knew I had to move out of that industry. And then in Sola, they're on top of what's happening. I hear about the competitive environment. I hear about trends in the industry. That is what drives the success. So I can keep my eye on the real estate, the people that work for me and my tenants.
[00:17:43] Speaker A: I love that so much. So little commercial for Kim Daly in the middle of that. Because it's a great setup, David. So this is speaks exactly to why, if you're thinking about owning a business, you Want a franchise consultant who has deep relationships and knowledge and understanding of which franchisors are the best ones out there. Because not all franchisors are going to be there to support you. Not all franchise cultures are supportive like the culture at Sola Salon. So if you're thinking about owning a business, you need an experienced franchise consultant who, who can guide you to the best franchisors out there. Because just like David said, I firmly believe that when you meet me, I'm going to tell you, franchising is about who, not what. If you're not partnered with people who have a vision for bringing this brand into the future, what are you doing? You're not buying a business for where it came from, you're investing in the franchise for where it's going. Where it's going funnels back to who's leading it, how, how much money do they have, what's their experience? So past performance is some indication of future capability, but it's not everything. It really does come back to your feeling of who these people are, the culture that they built, the vision that they want to share with you. And as they start sharing that vision, you feel inspired to sort of just like raise your hand and say, please pick me. Because franchises are awarded, they're not sold. So you have to make the franchisor want you. Pick me. I want to take your brand back to my hometown and help you achieve this grander vision. And then the added bonus of all of that is the camaraderie with all of those other franchisees who, even while you're exploring the franchise, you're going to get a taste of, who are these people? Why does somebody from Deloitte invest in a franchise? You're going to hear those real world stories and be able to make that connection to your why, to your background and feel like, well, if he can do it, I can do it. That's the point of validating with owners before you invest in a franchise, not to mention just to get a little taste of this, wow, these people are open to sharing what they do with me. Why, this is something that's totally unique to franchising, that in many other industries, especially corporate America, there's not a lot of sharing of knowledge. But here in a franchise, we understand that when our fellow colleagues are doing well, we're doing well because we're all shareholders in the same brand and we're all working together to build that brand equity. Brand equity is dollars in your pocket upon exit. So enough of my little commercial, back to David's story. But I had to insert that because it was a beautiful little setup you had right there. Okay, so you got in. You're an unexpected franchisee. You planned for four. You're now building 14. So what has encouraged you to keep going? Like, let's get down to the nitty gritty. What's the real why here? I mean, are you making so much money? Are you having so much fun? What's the why that's driving you to keep going back and building more and more stores?
[00:20:49] Speaker B: I own the rights for a little while still in Virginia beach, which is great. And I still have some more leeway I can do up here in Richmond. I think there's a couple things here. One is, you know, having been in the infancy of this industry as a franchise business, I mean, certainly there were salon suites available before Matt and Stratton came along and form solo. I actually got my haircut with a guy in Chicago that moved from a small salon to the basement of a building where he had a studio with seven other chairs in it. So it was funny because I looked back years later and said, oh my gosh, this business was here. But why did Sola grow? Well, this goes back to your comment. The reason it grew is because some smart people had some good ideas and were able to put together the pieces of the Puz. So that wasn't just a one off in that place. They literally painted the pipes in the ceiling that they didn't cover. It was wall to wall white everywhere. Every wall, every surface. It was campy, it was fun, it was new, it was young. But it wasn't something that was scalable. And I think that's really what gets into it. So as I look at Sola and look at this maturation of the business, you really see that scale matters. And that's why I keep growing. It's because I think we can deliver better. I think that we have a better team. They want to grow, I want to grow. I see opportunities to grow and scale the business. Because in the end of the day, as you enter a franchise business, everybody will ask you from the first day, how are you going to get out? How are you going to sell? What's your plan? So two levels. One, I love what I do, so I love doing this. I want to keep doing it. I like the cash flow it generates and I like how I can reinvest the cash flow and continue to produce higher returns. I think some people have to put a lot in because they're having trouble or they haven't Taken the steps. That's just like any franchise. You can own a subway and you're not advertising well and you have to put more time in. But more importantly is I think with scale, you get to the point where you either go to a bigger fish or you can raise some money and go get other fish and go pick up other things. So to me, the end game is incorporated into continuing to grow and learn and to find new things, influence more of the business, and create options for myself when I want to exit.
[00:22:53] Speaker A: So good wealth is always created through scale. And if you listen to what he was saying, what he was basically saying is the bigger he gets, the easier it gets. That's what I heard. Kind of like having children. The first one shocks your life the most. The second one a little bit hard. But after you get past three, four, I mean, I think they just start raising themselves.
[00:23:14] Speaker B: And the other part too is having a good team. I think you have to find people you trust. I think the other interesting thing of Sola is you really have to be able to scale yourself as you scale your business. You have to be able to put people in roles that you used to take. And the way I would always say it in Sola, because it's such a mechanical type of business, when you look at the walls and the ceiling is at a certain point in the growth of the business, if my head was above the ceiling that day, it was a bad day. Okay? If I was fixing a wire, if I was in underneath a sink, that's a bad day. Doesn't mean that day doesn't happen. Because we all have bad days. We have bad hair days, we have bad makeup days, we have bad whatever days. You can have a bad day. The trick is you don't want to have three bad days in a row. You can jump in because I might be the one who knows that system. Because when I was growing in this business, I knew it. So you have to be hands on. You have to understand. I once read a really good book about a guy who started wealth and he did real estate. Just basically buying multi property real estate. He was a West Point grad, He was a colonel in the military. And he wrote these really campy webpage stories. And he said something I'll always remember, which is when you start buying buildings and you have boilers in your building, you have to get good at boilers. And in Sola you buy a lot of air conditioners, you gotta get good at air conditioning because you got women from the age of 19 to 70, okay, not to stereotype we have men too, but more than likely women are going to have a much more sensitivity than we find the men have to. Air's blowing on them. Air's not blowing on. So you got to learn, okay, is this the best air conditioning system? Is this not the best air conditioning system? How do these systems work? So this is an ever evolving business. The door system we used isn't the same as day one. The air conditioning system isn't the same as day one. You can't be spruce it in place. You have to be looking at, how do you do this better?
[00:24:58] Speaker A: David, you are so wise and you have so much experience. So for that listener who's out there, who's sitting on the edge, who's thinking about getting in the game of owning their own business so they can control their destiny, what advice would you have? Knowing what you know now, all these years later, what advice would you give to that person on the sideline?
[00:25:19] Speaker B: I think simply don't regret that you never did it. I mean, I think that taking that leap, trusting in yourself, enabling that backstop for yourself, plan it, prepare yourself, think about it, live the dream. But it's not just a dream about money. It's not just a dream even about lifestyle. Decide what you want to impact and then figure out a way to make that happen. The beauty of franchising to help Kim with what she does. And I have lots of friends at Franchoise. Sola and Franchoice have been very connected for many years and many, many success stories I could tell you about is, you know, find that partner that can see the world through your eyes and be able to help you find the thing that fits your needs and your passions and then do it. I never wanted to be someone who regretted I didn't do it. And I found that at that point in my life, I felt there was more risk in not doing it than doing it. But understand there's no easy path. You have to put the work in. You've got to learn the trade, got to learn the boilers. You got to learn it. But when you do, it's really not as hard as you thought it was going to be, that it's going to make sense. You're going to figure it out. You're going to find people on the way that are going to help you. More people want to help you than don't want to help you. And if you go with that attitude, it makes a huge difference.
[00:26:33] Speaker A: Amazing. So well said and I love it. It supports franchising. We are in this together, right you're in business for yourself, but not by yourself. That's the very cliched line that we use in franchising. Well, for those who inspired to begin your journey to find the perfect franchise, the right vehicle that will take you personally, professionally and financially, anywhere that you want to go. Well, you know that I want to be your franchise consultant. So please follow the link in the description right now. Don't overthink it, don't delay, follow the link. I will reach out to you right away. And until next time, my name is Kim Daly and I want to be your daily coach.
You can find more content just like this on my YouTube channel at KimDaily TV. And if you're inspired to take the next step to explore franchises matched to you, please email me right now at inquireimdaily Daily tv. That's Inquire at kimdaily TV.
