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🍟 Thursday 3: Turning Trash Into Cash

www.franchisebreakdowns.com

🍟 Thursday 3: Turning Trash Into Cash

Plus: Commitment & The Benefits of Compounding

Jan 13, 2022
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🍟 Thursday 3: Turning Trash Into Cash

www.franchisebreakdowns.com

Welcome to the 618 new Wolf Pack members who have joined us since Monday! Join 2,807 entrepreneurial minded folks by subscribing here:


Wolf Pack,

Today we have an interesting lineup: with one tweet and article covering the idea of compounded efforts, and a breakdown on a franchise with very impressive numbers at scale.

Let’s get right to it 👇


One Article:

David Perell: Hugging the X-Axis:

“A life without commitment is a life where you can't take advantage of compounding curves”

This essay was a great reminder of the benefits of having a singular focus. It reminded me of two things:

  1. The person who always switches career paths never gains expertise in a particular area

  2. In franchises, the owners who stay committed to building locations are the ones that end up as success stories (example: Tom Cook of Pacific Bells).

Think long-term, and take advantage of compounding efforts!


One Tweet:

Jack Butcher: an example of compounding efforts

Twitter avatar for @jackbutcher
jckbtchr.eth @jackbutcher
The internet is big, keep going.
Image
3:11 PM ∙ Oct 30, 2020
1,269Likes89Retweets

In 2021 Jack Butcher surpassed over $1M in personal revenue, because he stayed committed and reaped the benefits of his compounded efforts.


One Breakdown: College Hunks Hauling Junk

Fast Facts

Background

  • Founded in 2003, franchising since 2007

  • Based in Tampa Bay, Florida; 156 territories operating

  • Offers junk removal, moving, and labor services

Fees + Investment

  • Franchise Fee: $40,000 - $60,000 (depends on market size)

  • Royalty: 7%

  • Brand Fund: 2%

  • Initial Investment: $108,700 - $273,200

Financial Performance

  • The below information is based on 90 franchised outlets in the full year 2020

The Wolf’s Take 🍟 

Average EBITDA of $214k off of at most a $273k initial investment…for a sample size of 90 franchisees, that is a super impressive system-wide performance 🔥.

At 156 territories operating, there is likely still a couple hundred available markets for this franchise. My biggest questions in general would be:

  1. Is this industry over-saturated?

  2. How many territories do the top performing franchisees own?

The latter question is best answered by talking to existing franchisees, while the former requires a deep-dive on the junk removal industry.

Competition is of course not a bad thing, if anything it’s typically a good sign that there is a market to support a business. However there are many competitors that saw plenty of growth over the last decade i.e. Two Men & a Truck (314 territories), Junk King (136 territories), 1-800-Got-Junk? (160 territories), etc.

This doesn’t mean the market’s full though - there’s plenty of folks who passed on Five Guys just because McDonald’s, Burger King, Wendy’s, In-N-Out, Sonic, etc. already existed.

But for me it is the question worth digging into on a macro level if you want to pursue this franchise opportunity!

Resources

  • College Hunks Franchise Website

  • College Hunks Expands in South Florida

The Wolf Of Everything Else 🌎

  • A convenience store startup just raised $100M 🤑

  • Apple is in serious talks with MLB to broadcast games ⚾

  • Cannabis compounds MIGHT help in preventing covid-19 🍃

  • Arby’s is giving away free milkshakes with it’s new Diablo Sandwich 🌶️

That’s it for this edition of The Wolf Report. Feel free to reply with any questions or feedback. If someone sent this your way and you haven’t subscribed yet, you can also do that below. Thanks and see you next week!

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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.

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🍟 Thursday 3: Turning Trash Into Cash

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