Multi-Unit Franchising's Main Event: Top multi-unit franchisees flock to MUFC '23

“Networking here is worth more than your net worth.”

With those words of encouragement, Gary Robins, a Supercuts multi-unit franchisee and this year’s conference chair, formally welcomed attendees to the 2023 Multi-Unit Franchising Conference (MUFC) at Caesars Forum in Las Vegas. 

The event, held April 25–28, dealt a winning hand to the more than 2,200 people who attended, including more than 800 franchisees representing 250 brands, operating more than 15,000 units, and generating more than $14 billion in systemwide revenue. Compared with 2022, overall attendance was up about 20%, and franchisee attendance spiked by some 25%. Franchisees had access to top-tier educational opportunities, brands, suppliers, and those all-important peer-to-peer networking opportunities.

Keynote speakers this year were Peter Diamandis, visionary, author, innovator, and XPRIZE founder, and Col. Nicole Malachowski, U.S. Air Force combat veteran, fighter squadron commander, and the first woman Thunderbird pilot. General sessions and breakout meetings offered timely and topical insights into operating successfully in the franchise space today.

The event has become the go-to conference for franchisees, franchisors, and suppliers to gather, talk shop, do business, and have some fun. That business took place informally in the halls of Caesars Forum as well as in the Sponsor Networking Area, which has grown to fill two large meeting areas and set a new record for the number of exhibitors.

TEEING OFF

The conference swung into action on Tuesday with MUFC’s annual charity scramble-style golf tournament at the Arroyo Golf Club at Red Rock. The course rests high above downtown, offering a panoramic view of the Strip. That evening featured a franchisee-only get-together at Carmine’s Italian Restaurant in The Forum Shops at Caesars Palace—always a great opportunity for franchisees to see old friends and make new ones.

DAY 1, WELCOME AND KICKOFF

A continental breakfast greeted attendees as they prepared for their first full day at the event. In the opening general session, Robins encouraged everyone to make personal and meaningful relationships and to take advantage of the opportunities in store throughout the week. He also recognized the event’s Platinum Sponsors, Jersey Mike’s and Inspire Brands.

Next up was keynote speaker Diamandis, who wasted no time diving into his message of “Megatrends for the Exponential Road Ahead.” Discussing the rapid growth of communication and sensors (e.g., satellites, 5G, IoT, watches that monitor body functions), he said, “Everything will be connected, everywhere, all the time.” He also ran through present and future tech such as a new generation robots, autonomous vehicles, artificial intelligence, 3D printing, and predicted that human longevity could be improved by decades, perhaps even longer.

A general session, “Managed Growth Strategies for Choosing a New Brand” followed. Multi-brand franchisees Rob Branca and The Falcons Group CEO Shamsu Charania, along with Aziz Hashim, founder and managing partner of NRD Capital, shared their experiences with adding brands to their portfolios to help balance and grow their businesses, with Robins moderating.

Their wide-ranging conversation touched on adding established vs. emerging brands, diversifying outside of your current sector, unit economics, succession planning, the value of a brand’s culture, build vs. buy, how to assess remodeling costs in a potential acquisition, the pros and cons of using brokers, the state of franchise lending, and more.

“Show me a great franchise brand and I’ll show you a great franchisee association,” said Hashim. “Your franchisees are your client.”

“I look at management to see if they’re running corporate stores—more than a few, not just a test store,” said Charania. He wants to know they can feel the pain too, as well as the success of their brands.

And after years of running a large Dunkin’ operation, Branca is branching out into a pair of automotive aftermarket service brands to diversify his holdings.

A new MUFC feature followed lunch: two seasoned multi-brand operators shared their paths to success before a general session audience. Sean Falk discussed the various brands he has been with, the importance of being involved, and his foray into becoming a franchisor. He also talked about how his children are now joining the franchising business. Next, Damon Dunn shared his inspiring story of growing up in poverty before playing football for Stanford. After the gridiron, he’s created a successful career in real estate and become a multi-brand franchisee across several states.

The next general session panel was “Succession Planning: Strategies for Your Next Chapter.” Kendall Rawls, director of development for The Rawls Group, moderated a group that included Paul Booth, Ace Hardware franchisee, brothers Jesse and Charles Keyser, franchisees with Sport Clips, Oxi Fresh Carpet Cleaning, and Ideal Image, and father and son Brent and Craig Veach, Del Taco franchisees.

The panel explored when and how to transition the business, creating a timeline, training those who will take over, and, importantly, ensuring your franchisors know your plan. Jesse Keyser commented, “We started thinking about how we would get out of the business the first day we opened.” (Keyser was named the 2024 MUFC conference chair.)

Paul Booth added, “Continue training your people, offer opportunities, reward, build a great culture, and communicate.” The session brought the day to an end, and the Sponsor Networking Area opened its doors with plenty of food, drink, and lively conversations to cap off a day of invaluable learning and networking.

DAY 2, THUNDERBIRD, MVPS, & POLITICS

The second full day ramped up with a continental breakfast buffet before ushering in the first in the day’s concurrent breakout sessions, which covered four areas: Growth, Legislative, Next Gen, and HR. Topics included “Strategies for Underperforming Units,” “How Franchisee Associations Protect Your Investment,” and “Create Opportunities for the Next Generation of Leaders.”

Next up was the MUFC’s second keynoter, retired U.S. Air Force Col. Nicole Malachowski, the first woman to become a Thunderbird pilot. Growing up in Las Vegas watching the Thunderbirds fly overhead, she said it was her childhood dream to fly one someday, despite the long odds. As challenging as your own path to success may be, try this on for size: there are only six Thunderbird pilots in the world at any one time. And before her, all were men. (Level of difficulty? Just try flying a fighter plane at hundreds of miles per hour with your wingtips 18 inches apart from the next plane, sometimes upside down!)

Malachowksi lit up the room with her life story, highlighting three core ideas that led to her success: courage, trust, and vulnerability. “The path to success is littered with failure,” she said as she recounted her many challenges and successes. Taking risks, believing in herself, and building trust with her team have defined her years of accomplishments.

“Nothing of significance is ever accomplished alone,” she said. When she began her Thunderbird training, one of her first big lessons was learning to trust the team of 125 people who took care of her plane (and her life). Addressing the rapt audience of franchisees, she emphasized how every job in their own businesses is not only necessary, but critical to their organization’s success.

Despite other people’s expectations, prejudices, and biases—most telling her it would never happen for her—she eventually received encouragement from a key officer, pushed through her own fears, and made history. “Don’t ever write yourself out of the script—or anybody else,” she said.

Yet, beyond her aerial and leadership accomplishments, Malachowski said her proudest moment came as a squadron commander when she was able to change its culture to embrace vulnerability, which she called the foundation of elite team performance. “The thing that sets an elite team apart when things go wrong is that we can talk about it openly, transparently, and collectively,” she said.

Following her inspiring keynote, attendees gathered in a general session for lunch and the presentation of Multi-Unit Franchisee magazine’s annual MVP Awards as each winner stepped onto the stage to receive their award in recognition of their contributions to franchising and their communities. See their individual stories elsewhere in this magazine.

IFA CEO Matt Haller took the stage next to provide an update on how the IFA is combating threats to franchising in Washington, D.C., and at the state and local levels. He provided a quick review of a number of policy issues, including NLRB and FTC investigations of franchising, before welcoming a panel to the stage for a session called “Advocacy and the Value to the Bottom Line.”

Panelists were Ashley Coneff, head of government affairs and community engagement at Inspire Brands, Alex Johnson, a franchisee with Auntie Anne’s, Cinnabon, and Scooter’s Coffee, and Michael Lotito, co-chair of the Littler Workplace Policy Institute. Haller walked the panel through hot-button issues that included opposing the confirmation of Julie Su, President Biden’s nominee to be the next Secretary of Labor; working to defeat California Assembly Bill 1228 (the Fast-Food Franchisor Responsibility Act); the NLRB and joint employment; and re-establishing the Employee Retention Tax Credit.

The bottom line? Every franchisee needs to be actively fighting anti-business legislation in their home cities and states and at the federal level. Said Haller, “If you think franchising is a great business model, I think it’s worth fighting for because there are a lot of policymakers ready to take you down. It’s you we need.”

THE ECONOMY

FRANdata CEO Darrell Johnson followed on the main stage with his annual overview of the economy, and how he sees it affecting franchising over the coming year. Johnson said the “uncertainty meter” is way up this year and that franchise operators should prepare for an “economic slowdown, sticky inflation, and high-interest rates.” Access to capital, he said, will remain tight and multi-unit franchisees will have to rely on diversification, flexibility, and agility to tackle uncertainty. Other observations included the following points.

• The labor market is becoming more complex, attributable to factors beyond wages.
• Strong consumer spending is fading as savings rates decline and the cost of debt increases; yet, while consumers are less optimistic about the current economic landscape, the current situation is better than consumer perceptions.
• Lenders are tightening credit boxes, making it harder and costlier to obtain business loans; banks that provided more than 40% of SBA loans in 2022 will be implementing stricter credit policies; and it’s not just the cost of capital, but the time to underwrite a loan increasing as banks face additional headwinds.
• Today’s new economic era is forcing permanent business model solutions, and franchisees looking to expand are choosing acquisitions over opening new units.

Wrapping up his presentation, Johnson took the opportunity to announce the 2022 FUND Score winners: Tropical Smoothie Cafe, The Goddard School, and Primrose Schools. Honorable mentions were The Joint Chiropractic and Mountain Mike’s Pizza.

Franchisees then headed into breakout sessions that included “Adding Service (Non-Brick & Mortar) Brands To Diversify Your Portfolio,” “How the Big Guys Do It—Managing People in Large Enterprises,” and “Build Your Infrastructure to Grow.”

The Sponsor Networking Area reopened to end the day with another round of drinks, hors d’oeuvres, and the opportunity to network and check out what the exhibitors had to offer.

DAY 3, INFRASTRUCTURE & GROWTH

The conference wrapped up with a well-attended morning closing session titled, “Build Your Infrastructure for Growth—The Right Financial Partner Is Key.” Glen Helton, a multi-unit franchisee with Burger King and TGI Fridays, moderated a discussion with Luis Ibarguengoytia, a multi-brand franchisee with Pizza Hut, Cru Food & Wine Bar, Ling & Louie’s, Applebee’s, and Panda Express, and Nicholas Marco, a franchisee with Hand & Stone Massage and Facial Spa, Drybar, and Sweat 440.

Each shared their journey into and through franchising, speaking on the importance of finding the right lending partners, the importance of a good CFO, and keeping a watchful eye on their financials along the path to growth.

CUSTOMER SATISFACTION

Franchisees liked what they saw and heard at the conference.

“Having been a Multi-Unit Franchisee magazine MVP Award winner in 2018, I’ve had the pleasure of returning to MUFC each year and getting to learn something new from the insightful panels and general sessions,” said Alex Johnson, an Auntie Anne’s, Cinnabon, and Scooter’s Coffee multi-unit franchisee. “The keynote speakers are dynamic and inspiring, and the networking is unmatched. In 2021, it was because of attending MUFC I found my third brand, Scooter’s Coffee, and became a multi-store developer in a new state. My portfolio continues to grow thanks to MUFC!”

The 2024 Multi-Unit Franchising Conference will return to Caesars Forum in Las Vegas March 19–22, 2024. For more information, visit www.multiunitfranchisingconference.com in the coming months.

CONFERENCE BY THE NUMBERS

Aggregated statistics from the 2023 MUFC