🍟 8/4/2022 – Money Under The Mattress (Franchise)

FRANCHISES OF THE WEEK

1) Verlo

Fast Facts

Background

  • Founded in 1989, franchising since 2011
  • Based in Wisconsin; 32+ locations open
  • A mattress store with a model that cuts out the middleman

Fees + Investment

  • Royalty: 5%
  • Brand Fund: 1% 
  • Franchise Fee: $50,000 
  • Initial Investment: $360,438 – $424,655

Financial Performance

  • The below table contains historical financial data of 10 single store franchise operators 

The Wolf’s Take 🍟

I wasn’t expecting to ever see a mattress franchise out there, but here we are!

And judging from the numbers…this looks like a great business! $223K in EBITDA from a ~$425K investment is extremely high across any brick & mortar franchise. 

Verlo’s model (according to their website) combines building personalized mattresses locally and selling them directly to the customer – cutting out any middleman markup.

My biggest question is how much would the on-going capex expenses be to run a store (can’t imagine keeping stock of dozens of mattresses is cheap).

But regardless, this is a unique franchise opportunity that shows great unit economics! 

Resources

2) Mici Handcrafted Italian

Fast Facts

Background

  • Founded in 2004, franchising since 2020
  • Based in Colorado; 7+ locations open at the start of 2022
  • A fast casual and delivery Italian restaurant 

Fees + Investment

  • Royalty: 6%
  • Brand Fund: 2%
  • Franchise Fee: $45,000
  • Initial Investment: $244,205 – $586,605

Financial Performance

  • The below financial data is from 7 affiliate owned locations open for the full calendar year 2021

The Wolf’s Take 🍟

Mici is putting up some ridiculous numbers for a food franchise of this investment level. It’s an interesting concept that is attempting to combine quality Italian food (artisan pizza’s, pasta, etc.) in a QSR format.

Simply put, any restaurant that is showing the potential for $300K in EBITDA is worth looking into – Mici is doing that with an investment that’s below $600K.

Resources


FROM THE POD

Mike Kelley – Sylvan Learning

My conversation with Mike was jam packed with discussion about:

  1. Owning and selling a service franchise
  2. Growing to 10 locations of Sylvan Learning 

And also…why he decided NOT to move forward with Chick-Fil-A after an 18 month application process. Take a listen to the episode here!

Disclaimer: This Content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice. Nothing contained on this site constitutes a solicitation, recommendation, endorsement, or offer to buy or sell any franchises, securities, or other financial instruments in this or in any other jurisdiction in which such solicitation or offer would be unlawful under the franchise and/or securities laws of such jurisdiction.

All Content in this email is information of a general nature and does not address the detailed circumstances of any particular individual or entity. Nothing in the email constitutes professional and/or financial advice, nor does any information in the email constitute a comprehensive or complete statement of the matters discussed or the law relating thereto. You alone assume the sole responsibility of evaluating the merits and risks associated with the use of any information or other Content in this email before making any decisions based on such information or other Content.