Lansing, a launching pad for franchise business

Britt Slocum never planned to expand his family-owned sandwich submarine shop beyond a few locations. But it wasn't long before the Lansing-based Jersey Giant took great strides throughout Michigan.

"We've been an organic growth, family-owned business for 34 years," says Slocum who collectively runs 19 restaurants with his two brothers and two sons. "Right now, we seem to be opening shops faster than ever."

In the past few years, Jersey Giant has opened a couple new stores annually—faster, Slocum says, than any time in the company's history. Stores emanate from the eatery's original East Lansing location, and are popping up in Kalamazoo, Grand Rapids and Detroit.

That type of growth makes Jersey Giant ripe for franchising—a concept that involves granting entrepreneurs the right to use a company's trademark, systems, products or services in exchange for an initial investment and ongoing royalties and fees. And it's a path that has led to success for several multi-unit businesses in Greater Lansing.

"Based on our size, franchising would be the next logical step," says Slocum who admires local franchisors Biggby Coffee and Two Men and a Truck. "We have no plans to franchise, but I wouldn't rule it out. It would be a way to leave a legacy—like Tom Monaghan did by building Domino's Pizza."
Preparing to launch           
Nationally, Michigan has been a hotbed for launching franchises, including such household names as Domino's, Little Caesars and Hungry Howie's. Greater Lansing, too, is becoming increasingly recognized as an epicenter for successful franchises.

Ken Root, director of membership for the Small Business Association of Michigan, remarks that Lansing's Midwestern work ethic makes the area appealing to home-grown multi-units looking to franchise as well as national franchise units coming to town.

"Historically, folks who started franchises in Michigan have had strong ties to the state and have kept their headquarters here," says Root. "We see that in Lansing, too, with area giants like Two Men and a Truck and Biggby."

Conversely, national franchisors examine demographics to determine whether a concept will succeed in a particular location. Lansing's current growth curve, a re-awakening downtown, and a steady university community have caught the eye of several national franchisors, including those like Five Guys Burgers and Fries.

"Lansing wants and supports entrepreneurs and go-getters who want to make that jump into business," says Root. "It takes a different type of entrepreneur to dive into franchising. With franchising, what it often comes down to is a person in a local area who is willing to take something on and keep that name going."

Biggby, Root says, is among the Greater Lansing icons of a local business gone franchise.

Biggby CEO and co-founder Bob Fish started his coffee shop company in 1995 with a single unit in East Lansing. About a year later as he opened his second cafe, he decided to give franchising a try.

Since then, Biggby has become the fastest growing coffee franchise in the Midwest, with 200 cafes open or under contract across nine states including Michigan, Ohio, Indiana, Illinois, South Carolina, Wisconsin, Kentucky, Florida and Texas.

"Lansing is a great place to build a company because the work ethic is strong," says Fish. "The state capital and university have a real impact, and the city tends to attract and retain bright people. For a company like ours that hires a lot of young people who are given a lot of responsibility, that's a great asset."

Fish says the exponential growth that can happen under franchising is nothing short of phenomenal.

"I had 12 people working for me in my first store in 1995," he says. "Today, Biggby employs about 2,700 people. That's a remarkable stat."

Back in 2006, Biggby was a 20 million dollar company. By the end of 2013, company revenue edged near 70 million. And since Biggby makes its corporate home in East Lansing, much of that revenue comes back and is pumped into Mid-Michigan's local economy.

"The beauty of franchising is simply that you get to bring a lot of people into the realm of creating their own destiny by giving them a chance to own their own business," Fish says. "In our case, that's a Biggby coffee shop. We lend our entrepreneurial sense to those who want to start their own business, with a little more security and support than doing it all on their own."
Finding a fit
Although fast-food restaurants like McDonald's, Kentucky Fried Chicken and Steak 'n Shake are familiar franchise businesses, opportunities abound in most every industry and occupation. lists businesses for sale in thousands of markets. With a combination of capital and ambition, the entrepreneurially inclined can find a franchise model that aligns with their goals. Costs for buying into an existing franchise can range from tens of thousands of dollars to more than a million, with the average price-point for a restaurant or local retail outlet being about $200,000.

"Entrepreneurship is founded in a lot of ways and franchising is high on the list," says Jeff Smith, director of the New Economy Division at the Lansing Economic Area Partnership (LEAP). "We're eager to see more restaurants and independent business franchises coming in or local companies moving toward franchising. The more we can bring funds from outside Lansing and back to the community, the better it is for growth."

Two Men and a Truck, Smith says, sets a strong example for the good that a locally grown franchise brings to the community.

In 1985, Mary Ellen Sheets founded Two Men and a Truck as a way for her high school sons Jon and Brig Sorber to earn money as local movers. Since then, the company has grown into the largest franchised moving company in North America. Headquartered in Lansing, the company remains primarily family-owned, with Sheets, her two sons, and daughter Melanie Bergeron in key leadership roles.

"Back nearly 25 years ago, the founders felt a strong culture of support for their start-up efforts here," says Kelly Rogers, franchise development director at Two Men and a Truck. "Lansing has a very close network of business professionals who give advice and support businesses growing here. It's a very supportive culture and not cut-throat like other markets."

Today, Two Men and a Truck has more than 260 locations that provide local and long-distance moving services in 34 U.S. states and in Canada, England and Ireland. The company is growing and nurturing markets in Washington D.C., Maryland, the East Coast, California and Pacific Northwest, with a goal of opening 30 new locations in 2014.
Back home in Lansing, Two Men and a Truck is adding 20,000 square feet to corporate headquarters as they ramp up for 125 new staff. The expansion represents a nearly 9.5 million investment, with all vendors and contractors sourced from Michigan.

The company, Rogers says, has never forgotten its roots. Leadership, she says, regularly gives back through charitable gifts to Michigan and national organizations, and by mentoring area entrepreneurs looking to franchise in any industry.

"We have a very energetic and can-do culture," says Rogers. "The family works very hard to share their message about how they started and what you can do."


Ann Kammerer is the development news editor for Capital Gains.

Photos © Dave Trumpie
Dave Trumpie is the managing photographer for Capital Gains. He is a freelance photographer and owner of Trumpie Photography.
Enjoy this story? Sign up for free solutions-based reporting in your inbox each week.
Signup for Email Alerts