Episode Transcript
[00:00:03] Speaker A: Welcome to create wealth through franchising podcast and Kim Daily TV. I am your host, Kim Daley. I want to educate, motivate and inspire your business ownership journey by interviewing CEO's leaders, sales coaches and exceptional franchisees to learn their valuable insights and strategies that we can apply to our own business ownership dreams. Now onto the show.
[00:00:34] Speaker B: Welcome back to create wealth through franchising podcast and Kim Daley TV. Our special guest with us here today in studio, his name is Kevin McNamara. He is a multi unit Image Studios 360 franchisee, Kim Daley's favorite brand. Kevin, welcome to the studio of Kim Daley TV.
[00:00:57] Speaker C: Thank you, Kim. It's an honor to be here with you. And we're talking for a show started here about how you've helped us grow. Thank you so much for all you've done for the brand because it helps all of us.
[00:01:06] Speaker B: I mean, I don't know if I can be so biased on my show to be like, I love Image studios. My listeners and followers already know because Jason Olson, the founder of Image studios, is the only guest to have appeared four times on this podcast. And there's a reason for that. Because I'm obsessed with, with the salon suite model. I'm obsessed with image studios, their growth, the people, the franchisees. And so, Kevin, I've invited you into the studio today because my listeners, they love to hear the inspiring stories. There are so many people out there who are sitting on the sidelines who think about franchising and they're afraid to jump in. And so we want to speak to those people. But then there are people who follow me, who are also franchisees, just looking for a secret sauce or an extra tip, a little edge. So we want to speak to them. So let's start at the beginning of your story and tell me why. What problem were you solving for in your life? Like, what was happening when you were like, I gotta do something different?
[00:02:11] Speaker C: That's a great question. Cause I had to do that. On a lot of the development calls we do people, I start short and sweet about me and go more to them. Cause that's more interesting. But short and sweet about me is 16 years in banking. What's the commercial banking business? Banking management and so on the sales side. But the risk analysis training takes place left there. I always want to be, have my own business, got into packaging, of all things. But the good thing is that led me into commercial real estate, bought the warehouse that we had and learned a ton from two awesome partners down here, and then tried to go sell that company, go back into selling the banks. And that was not fun at all. So then I was kind of like, what do I do? And my wife was a very successful franchise, e with curves and something else. Why don't you try a franchise? And then my mom says, why don't you try a franchise? And my best buddy in the world used to sell franchises. Kind of be like you. Not anymore. But he knows the model. I learned through him. So I said, you know, why not? So I called the person, and next thing you know, I'm sitting in front of image. And here we go.
[00:03:14] Speaker B: So image studios stuck out to you as a franchise because you had a real estate background, because you had a property. Speak to that a little more good.
[00:03:24] Speaker C: Well, one concept I was shown product you do often, Kim, because you, you all know, the whole landscape was a boxing one. And my wife stayed quickly. She says, those are fads. They come and go quickly. No offense to the boxing franchises. I'm sure they're great, but it wasn't right for me. And then another one's a school. And I thought myself, there's no way I'm gonna sit at home on a Friday night and get blessed out by some parent because little Johnny was left in the rain too long. I said, not doing that. And they all sudden image studio shows up. And it was commercial real estate, it was sales, a lot of numbers. And then I went for a visit, and you just hit the nail. One of the keys of the whole place. Jason Olson is just an amazing dude. He's just so genuine, so nice. I rode with him on Discovery day. Those days we're on site in Utah. He and I rode the car together one on one, and I just immediately said, this is the guy. This is it.
[00:04:18] Speaker B: This is the guy. You know why he says that, listeners? Because when you invest in a franchise, what are you actually doing? You're buying a partnership. It's always about people. It's about who, not what. You know how they say, Kevin, that your net work is your net worth? Well, in franchising, how true is that?
[00:04:38] Speaker C: Very true. And, you know, some folks come on the dev calls monthly and they act like it's just gonna be done for them. I said, no, it's still your business. You have guidelines. You have responsibilities. You have, you know, some guards on the, on the road to keep you in off the, you know, you know, the dirt, but you have to put the work in right? And you gotta love it. And quite frankly, I loved it. Then my wife helped out. She has been instrumental in our success. For sure. She's good in design. She's great with people. And so we took off in 2019. We signed up, we opened two locations, one in May of 2020, right in the middle of pandemic. That was really exciting. And then the other one in October of 2020, and both of them have stayed pretty full the whole time. And I love business. It's fun.
[00:05:26] Speaker B: Okay, wait a minute. Did you hear what he just said, everybody? He opened two locations in 2020. For all of those out there who worry about things like recessions and pandemics, if you're willing to be open and be coachable, you can find opportunity in the middle of obstacles. So let's just stay on that moment for just a minute. Kevin, what was, why was this model able to grow? Why were you able to open two locations in the pandemic?
[00:05:58] Speaker C: Well, first of all, I thought in mid April, I was going. I was like going to, what have I done right? We're still in construction.
[00:06:06] Speaker B: We all were there for a minute.
[00:06:07] Speaker C: I'll give you that. And I remember a distinct moment. I sat there and I was mulling over, and my wife was across the room, of course. Couldn't leave, couldn't go anywhere. And she's working on from the computer. And I said, I said, you got a minute? She goes, yeah. I said, we can sit here and lay down and get run over or do something about this. And she said, what do you mean? I said, let's put together an incentive program. So we did. And we give some free run away. We give a gift card away, and we still started being creative, right? This is not a franchise design. It's a Kevin and nan design. And next thing you know, we were opened up at 60% full, broke the company record, then we broke up, opened up Raleigh at 75% full again, broke our record. And since then, Lonnie and other great franchisees have broken their records. But one of the things we discovered was, and I don't say it too loudly, so don't tell anybody, Kim. But the pandemic was really good for some businesses. So our other key business is warehousing. And by the way, it's been great for warehousing. And then during the pandemic, people didn't want to have their hair done 2ft from someone else for 2 hours. And because the relationship is very personal and they might tell their Silas about their trouble at home or their son getting in trouble or whatever, or something that their friend making them mad, very personal discussions, well, they're better off being had in the private enclosed environment that's just been cleaned. Don't forget the shampoo bottle. Shampoo Shuttle wasn't they have 20 heads in the day, had five heads and was cleaned each time it was used so quietly. The pandemic has been great for us. It's great for us.
[00:07:38] 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 review. Your feedback fuels my growth and rankings and shows others that this podcast is valuable. Now back to the show.
[00:07:58] Speaker B: For those who are taking it for granted that you even understand what a salon suite is, in case you're new to Kim Daley and this is the first episode you've ever listened, listen to. Let me just back up and say that a salon suite is like a shared office environment. It's a mini mall of beauty professionals. Right? So on average, Kevin, how many suites do you have inside each of your units that you have open?
[00:08:19] Speaker C: We have 20 in white Forest at 4000ft. It's a little small. And I would do again 27 in Raleigh at 5100. Would do that size all day long. I'd probably go as high as six or seven. Some folks are going as high as eight or nine. In image. I think six or seven is a great number. Thousand feet. Sorry. And then the rooms, one of our models a little different in that we don't try to lease every square foot in the building we want. The how the place feels is as important as how many rooms are there. And that's why we're the best. I mean, I'm vice. I mean, I don't you think, Kim. But there's nobody like us. There's nobody like us.
[00:08:55] Speaker B: There's nobody like image. It is so true. So you as the owner of the franchise, you build out this salon suite model with approximately 20 or 25 suites and then you rent those suites to beauty professionals. That's the business. And so what Kevin is saying is that he opened at record breaking levels during a pandemic at 60% occupied in one, which means you're cash flowing from day one and 75% occupied, which means you're way cash flowing from day one. And this is weekly cash flowing return type of a business. With how many employees, Kevin?
[00:09:36] Speaker C: Zero.
[00:09:37] Speaker B: Zero employees.
[00:09:39] Speaker C: Zero.
[00:09:39] Speaker B: So for those who follow me, you're laughing because, you know, this is why I love swan sweets. But this model has every stinking characteristic that every business investor I ever met wanted with no flaws. The only thing is not everybody can afford it, right? And some people make it harder than it is they, they trip over certain things, like working with beauty professionals. So I want to go back to this, because you came from a banking industry, right? And then you said you own a packaging business.
[00:10:10] Speaker C: Yeah.
[00:10:11] Speaker B: You know, these, these artsy, creative beauty professionals. How, how has that gone for you in terms of build, being able to build relationships and keep them as stable, loyal tenants in your suites?
[00:10:25] Speaker C: Well, that's great. A great question. It's even more timely than you realize, Kim, because we're having our annual get together for franchisees in Salt Lake next week, ten days from now. It is the most exhilarating conference you've ever been to your entire life. It's a bunch of entrepreneurs from all walks of life get together and share their story. And you walk out of there feeling 10ft tall. And, you know, I just think what you do is the environment is so positive. Someone goes in and drops $200, $300 on their hair, $150 on the lashes, whatever it is, and they leave looking good and feeling good. And it's. Yeah, there's, sometimes there's a little, you know, negativity, but not much. People are happy when they leave. They're usually happy when they come, and then they spend a lot of money and they leave. And so it's so really cool. And guess what? They're not. They're not my clients. I just. But I do often compliment them. It's fun. And the stylists are. I'm also a little biased towards this. My mom always worked, my sister always worked, my wife works. I high on women entrepreneurs. Nothing against the men. We have a couple of those, too. They're wonderful. But we opened up Raleigh with 21 brand new. 21 people and 17 brand new entrepreneurs. 16 were female and they were. And they are empowered. They work less, make more money, have more fun, have a better life.
[00:11:46] Speaker B: Who doesn't want that? Who doesn't want to create an environment for that full of life giving activity? And you know what, Kevin? I have to say, you know, like, again, my followers know, like, when people are like, I want a recession resistant industry, I'm like, okay, you want beauty? And they look at me like, no. They were thinking pest control. And I'm like, no, think about it. You got a wife, a daughter, a girlfriend. We do not stop spending money on our hair, our skin, our nails, our eyelashes, whatever it is that we do that defines our look, makes us feel confident. Beauty is like the most recession resistant industry. And you know what I've learned from Jason Olsen over the years that this image studios franchise concept was born out of the recession in 2008 when Jason and his brother owned all those car dealerships and that business tanks in a hard recession. Right. And in walked the beauty professional with a bag of cash, and they were like, what do you do that you have cash in a recession? And she was like, all flippant, like, well, I'm in the beauty business. Women never stop spending money on themselves. And it got these two men thinking, we are in the wrong business.
[00:12:54] Speaker C: That's exactly right.
[00:12:55] Speaker B: And that's how this franchise was born as a business and then perfected through multiple models and then turned into a franchise. And now here we are at over, what, 200 units or something sold, right?
[00:13:06] Speaker C: And I didn't realize I was 9th in the system, so I was 13, two. I even knew that. I've watched us grow and watch something, person after person, of this amazing. And yes, that story, Kim, I've heard it a thousand times. Apparently now it's all, you know, folklore. The history always gets a little better. But she put down 50,000 in cash, and they about dropped their jaw. And then she said, yeah, I've heard about that recession thing going on. What's that all about?
And then I think the best part of him in the studio is, if you don't mind me tagging on here, Kim, is that Jason didn't rush out first. I don't know if he had the financial worth. I want to do it and start, and start a franchise. He opened units. He tested concepts. He tested. And if you get more into the business, we tell you more about it. But, like, ceilings or no ceilings, how big is the entry? All those things had to be adjusted and grow with over time. By the time he went to franchising, I think it was 17 or 18 about six years ago, he had his model pretty much perfected. And that's when I jumped in and I jumped in with a skeleton crew. It was the wild west. And soon, here comes Taylor Lamont, here comes Lizzie, and a bunch of people that are Brandon, your friend, a bunch of really amazing people, right?
[00:14:13] Speaker B: The company has grown so much, it's turned into just a world class franchisor and a franchise brand, which, again, is why Kim Daley loves it and why I wanted another image Studios 360 franchisee on my show to carry the flag and tell the story. Okay, so let's go back to your story.
Your wife was in franchising, which I love curves, by the way. That had a moment. And so you turn to franchising. So from other businesses, you've done, like, from real estate. Like, what are the differences? If you're speaking to, like, an entrepreneur out there or someone who's just thinking about owning a business, what are some of the advantages that you've seen in this partnership with your franchisor, especially in a model like this where 1 may go, why do you even pay a royalty for that? I think I could just go open one on my own.
[00:15:04] Speaker C: I heard that question a lot. You know, banker, baker, friends are really smart, or think they're really smart, say, why are you paying a franchise for this? Do it yourself? Well, the reason I'd say is not to my way is that I've been in commercial real estate long enough now with the warehouses for, like, I've been doing it like, six, seven years. I know that one mistake on one wall in the wrong spot is ten or $20,000 to move in the or maybe more. So why not pay a little bit for advice? Really good advice. And it's not even just a franchisor. Again, I'll say the other franchisees are amazing. I have my phone in my pocket. That's my Rolodex, the old black book from back when I was young. I have a black book right here. Rolodex right here. People don't know what that is. There's a contact list for these days, right? And I can call any one, about ten or 15 of our, text them midday. What do you think about this? I'll get a response in two minutes, or I'll call them and we'll have. We'll compare notes. We've come friends, and they're so motivating. So motivating. It's amazing.
[00:15:59] Speaker B: So you're saying that franchisees in the same system are not competitive, Kevin.
[00:16:05] Speaker C: Not at all. In fact, the term I use is we're rowing the boat in the same direction. We row our boat, they row their boat, but we're not competing. And they have an idea of how to win the race. Even better if you listen to them. And I have ideas and we compare notes and we all cross the finish line as winners, so. But we're all going generally the same direction. And the franchise provides guardrails, but not really constraints. But I would tell you this, Kim. You probably tell your clients this. My buddy told me this, and my wife told me this, by the way, she's my girlfriend. That was pretty cool. She was just, we've been dating a year, and she said, why don't you try this? No wonder I married her, right? But they said, well, you smart woman, that's right. Smarter man. That's definitely right. If you saw her, you'd be see more so.
And I think when you've joined a franchise, it really is, you have to follow the model. You can't pay for the model and not follow it. That's just why you call your attorney for advice and he or she says do this, you do something opposite. I've always said that's the, you've called them and paid them for advice. Do what they say, you gotta follow the model. Now, luckily you have some leeway. You know, you make some decisions. But if you get outside those, you have to ask for approvals. But follow the model because it works. Especially approving franchise like ours. And I'm sure you represent ours and many more that are very successful. They have models that work. They have models that work.
[00:17:24] Speaker B: Definitely have models that work. So now let's talk about from the banking side, the banker side of you financially, how does this investment compare to other things that you've done and like, why are you putting more money into salon suites versus maybe going and just buying another warehouse?
[00:17:44] Speaker C: Well, I think one thing I like the diversification we have with that, because if one gets a little slower, if you hit a bad deal and one it's okay, the other one helps complement the other way and wipes and technologies helps a little bit.
But I just think the return is really good. Now, you mentioned something earlier at an old banker, I'll tell you, a term we use is called capital intensive. So the open location is capital intensive in layman's term, requires a lot of money that you probably can't borrow right from a traditional bank. But there's a good news of that. It's also a barrier to entry. If you spend a bunch of money on this corner, the joker from down the street with no money can't open beside you because he's got no money or her as she has no money. And so, yes, but if you're smart and like I use Rob, you probably tell your clients this. I use some Rob's financing, I use some heat home, equal line of credit financing, I use some cash. I even had a credit card in the end and it all worked out really well. So. But you gotta sometimes cobble together the financing because a traditional bank would probably not want you a big check because that's not their, their game. Unless you own the building. You own the building. That would help.
[00:18:53] Speaker A: Hey, daily coach fans, if you're ready to begin your own journey to find the perfect franchise, please email me right now. At Inquirer KimDaily TV, my services are totally free for you. That's inquireyimdaily TV. Now back to the show.
[00:19:16] Speaker B: What Kevin is speaking to when he says Robs is the rollover for business startup. For those of you out there who haven't yet gone through my process, but I will absolutely lead you to lenders who can help you get pre approval. And now there actually is financing for image studios. Back in the day, when Kevin started the first 100 units, there was absolutely, absolutely no funding because this business. So when we look at, like, SBA loans, most people know SBA, I'm gonna get an SBA loan for my business. Well, that's a government backed lending program. But the SBa, this model doesn't, it's not approved by the SBA because the SBA likes to loan money to businesses that create jobs. But Image studios doesn't create any jobs. You heard him say he has zero employees. So this model didn't qualify. So what that meant was the first 100 units for image studios was the heaviest lift. Trust me, I've been with you guys since the beginning. We had to bring cash buyers to the table. But once they got to 100 units, which is the stabilizing point of a franchise, that's when banks no longer look at you as like a pioneer in the wild, wild west. Like, you've got some proof, you've got some solidarity. So then they came with, like, what we call apple pie funding, which is like different types of loans that first came in, I think around a half a million. And now that's even gone up because now they're up over 200 units. And now I think they've secured even up to 700,000. So these are bigger investments. There's. But, and that's what I was saying. Like, it's the business that every single investor I've ever met wants. But not everybody can afford to do it. So it's reserved for, you know, the elite, the people who are more secure in their financial path at this point in their life. But it's also fun to learn about it, even if you're not quite at the requirements and set a goal for yourself, because this is an awesome business to have inside your portfolio, because it really is. If we're talking about velocity of money and really building wealth and getting your money working for you, this is the type of business where you put your money in. But it doesn't require a lot of time once it's up and operating. So speak to that a little bit. Kevin, about how much time do you spend in each of your units? I know you're talking about building a couple more, so clearly you're not in there all the time because how do you be in four places at one time?
[00:21:38] Speaker C: That's right. That's a great, that's a great point. You know, I would tell folks that sometimes the miles presented is like no work at all. And I tell that's, that's fallacy. Well, and it can be that way, but honestly, I spend more time than I have spend because I like it. I'll go there today.
I was yesterday, both locations. I don't interrupt stylists and clients or slum professionals and clients, but if they're free, we talk. I mean, they become, we were friends and I enjoy their success and celebrate. It's so motivating to see them succeeding and see them cashing checks from their clients. So, but I'd say on average, both of them together I could probably handle in 10 hours a week. And that's really, that's a plenty. Now I spend more, I go five more hours, at least, maybe eight more hours. I go on site and I listen. And I'm a bait. I have to be available. You know, you hire a property manager to be available, but you know, they want to. The way they say is when you take care of them. And that means when they have a problem, you are attentive to it. So you have to yourself or be the. But, oh, my wife and I've been in Mexico many a time, and I'm working right here, but I'm not sitting on the beach. All I'm doing is watching my phone, and I'm enjoying that. And then on a good day, the phone doesn't buzz all day. On a bad day, it buzz a couple times. And usually I can handle it pretty easy or I refer it out to handyman or to somebody else. So, yes, it's not all that stressful, except the beginning. Beginning is tough, but then it's all, then it's cashing checks.
[00:23:04] Speaker B: Yeah, that's really good. It's weekly cash flow and returns. So, so good. So back to my point, that velocity of money, it's about putting your money into this investment, but not a lot of time, which frees you up to then invest in other things, have other businesses be working on a deeper passive portfolio. So for those investors out there who are alternative investors looking for another option, this is where when you think franchising and you trip over food and retail, this is why Kim Daley has a business it's not, you know, just to, like, bring you the common things. Really, that's not what I do at all. I want to bring you the uncommon things, the things that would not be on your radar, things like this model that catch you from off guard, and you think, wow, that's a franchise. It most certainly is. And this is why this is one of my most famous, favorite investments. Kevin, is there anything that you want to share in closing this interview? So there are people out there who I think listen to the show, and they worry about recessions. They worry about, is it going to work? Is it going to work in my area? And they stop themselves from taking that first step and reaching out to Kim Daley as an experienced investor and franchisee with multiple units in a brand new. What advice do you have for that listener?
[00:24:27] Speaker C: Well, I would tell you, first of all, I think you represent the brand. And, you know, the, it's obvious you know the business so well. Kim, you've probably been doing this many years, and I think you do have to trust your advisor, some like you, because they're going to hear you, listen to you, and ask you questions that are meaningful questions and how you answer them matters and that they can guide you to this place. I would never have guessed in a thousand years we'd own salon suites. Five years ago. That means five and a half years. I would never. But it's as I tell folks on the dev calls that we have monthly, whether people are considering joining, I say it's the best, one of the best financial decisions I made my life, maybe one of the best life decisions. So I think sit on the side of this. Fine, you know, if that's your so inclined, and it definitely is a crazy world, but at some point you gotta, you gotta jump in and why not jump into a franchise that's at least recession resistant, highly resistant, with, if it's fun, it's not going to kill you, right? You know, that's not going to 80 hours a week in the job. It's just no fun. And, you know, it's a lifestyle. It's a lifestyle decision that we made, and I would never look back.
[00:25:32] Speaker B: Amazing way to end this interview. Thank you so much for being my special guest today here on Kim Daily TV.
[00:25:40] Speaker C: You got it. Thanks, Kim.
[00:25:41] Speaker B: For those who are ready to get off the sideline and get in the game, you know that I want to be your franchise consultant and your daily coach. Please follow the email on the screen right now or reach directly out to inquireemDaily TV that's inquireimdaily TV. And until next time, my name is Kim Daley and I want to be your daily coach.
[00:26:12] Speaker A: 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 enquireimdaily TV. That's enquiremdaily TV.
