Latest / Reframe First / Nick Pepitone, CEO of Franchise Performance Group | Responsible Franchising & Smart Growth
Transcript
- Oleksij Rak: And hey guys, welcome to another episode of Reframe First. Alexey, I'm the host of the podcast and let me introduce our today's Nick ⁓ from Performance Group, ⁓ CEO Franchise Performance Group. Hi Nick, great having you here. Nick Pepitone: Hello, hi, thank you for having me. Oleksij Rak: Yeah, so at Franchise Performance Group, for what I read, so for what I understand, you are providing a full service outsourced franchisee recruitment solution for franchisers. So which includes business development, strategy processes, hiring, training, all of that kind, like a long, long list of services that you provide to help them succeed in their business. And could you tell us more about what you do at... at Franchise Performance Group and like what's your mission of the company is and what you do. Thank you. Nick Pepitone: Yeah, no, absolutely. And again, thank you for having me. And yeah, ultimately, I'll start with kind of our mission at Franchise Performance Group is to promote responsible franchising, which ⁓ can kind of dive into what that actually means later in the conversation. But as you we're an outsourced franchise development firm. So we work with franchise concepts from as ⁓ small 10 20 units all the way to brands that are looking to scale to Oleksij Rak: Okay. Okay. Nick Pepitone: multiple thousand locations, that be across the U S or internationally. ⁓ and our really our sweet spot is on the digital lead generation and outsource sales, but we also do consulting based work around go to market strategy, market penetration, as well as kind of process design around some of those ⁓ marketing and sales functions. So, ⁓ you know, a little bit, different buckets. ⁓ We not to cater to everything and every single task, but we also have ⁓ plethora of experience and some really solid team members to be able to hit ⁓ a few different areas. Oleksij Rak: you Yeah, awesome. mentioned like hundreds entities. Are there big names there? ⁓ Nick Pepitone: Yeah, we've got, we actually have a pretty solid list of over 150 clients that we've worked with ⁓ the years. Brands Marco's Pizza, Plyables, Subway. So some big brands in there, but also some of the most fun that we have are the concepts that ⁓ are what we would an emerging brand, that they have a really strong regional presence and they're looking to scale. into that next national brand. Obviously, we love the big brand names, but ⁓ also ⁓ the entrepreneur and all of us loves working with that small startup feel ⁓ is looking to be the next household name. Oleksij Rak: Awesome. could you tell me, I never experienced with franchises like this working from. So what does it take to replicate your business in 10 more So there are probably a lot of processes involved. Nick Pepitone: Yeah, well, there's quite a bit of processes involved. And I think this was what ties into that responsible franchising that I talked through with you is, you know, there's over 4,000 franchise brands that are registered in the States alone. And each year see about a 10 % turnover churn in that with an equal 10 added to the marketplace. And so ⁓ you start from that high top of funnel. But when you really drill down to it, the model, you're a quick service restaurant or a brick and mortar ⁓ agency, whatever the concept might be, it comes down to ⁓ that model and how it be replicated and what systems and infrastructure are in place. And so that's what a lot of the time that myself and our team look at analyzing, not only with our existing clients, but also the prospective clients that we interact with on a daily basis. We very particular about ⁓ type of infrastructure, what type of investment, and what type of people are in that organization. Because those are the items that really dictate the long-term success of an individual brand. Oleksij Rak: Franchises are all about really strict guidelines and really strict processes and operations. Is so? can it be from location location? ⁓ I know McDonald's. Nick Pepitone: ⁓ Right, yeah, yeah and McDonald's is you know, that's the poster child for franchises, right? Because there's you know, very specific standard operating procedures all the way from you know, how to invoice a customer or pay an invoice all the way to you know, making number one with cheese, ⁓ you know, and so I think that's where a lot of ⁓ franchise concepts the growth engine begins and they really start to see the opportunity to scale lot ⁓ the time and attention and detail that it takes are really where, you know, that's what truly unlocks that growth capability and the ability to replicate and provide consistency. But also an area, obviously, that requires a lot of investment and time from the franchise or brands. And so that's why, you one of the first questions we ask prospective clients is, Oleksij Rak: There. you Nick Pepitone: What does your war chest look like from an investment standpoint? How much dry powder do you have to be able to do this the right way? it's always going to take a lot more time and capital ⁓ you expect. And if you come in and say, hey, we're going to rub two pennies together to get this done, ⁓ I'll be the first one to tell you, hey, that's probably not going to be the outcome you want. Oleksij Rak: Yeah, when do the prospects come to you? When they have like a very few entities working and they want to start outsourcing the next ones? Or is it like one single point, some restaurant, okay, I want to start scaling. So what's the point when they come to you? Nick Pepitone: Yeah. So, and we get brands that come to us across all different stages. mean, just this past week, I had meetings with a donut concept that already has 400 locations and they're looking to take it to the next level. And then just yesterday had a conversation with a gentleman who he has one location he owns. He has one franchise location and ⁓ that's the that he's at. And so, ⁓ that's the cool part about my role is being able to see it from all parts of the spectrum. of growth. But we also, you we try to be realistic ⁓ the value that we can provide our clients. And so our really our internal skill set ⁓ our capabilities are much more geared for that 400 unit client, ⁓ based on our experience, compared to that single unit that's looking to scale. But that doesn't mean that we can't guide them ⁓ in provide some pro bono recommendations, but also, you know, still open the door because just because there's not an opportunity to work together today, obviously we want to have that opportunity down the road and love to see brands that scale into, you know, the 50, 100, 200, you know, regional concepts that we all know and enjoy. Oleksij Rak: And what does it like typical industries ⁓ that you work with? it like Corka? Nick Pepitone: Yeah, so, yeah, we see it across the board. I would tell you that the most consistent and steady and really the largest player in the franchising industry is what we would call a QSR concepts of quick service restaurants. so these would be not necessarily your fast foods like the McDonald's or Taco Bell's. They're more in inline retail ⁓ 1500 feet. They have ease of ordering and access quick delivery time of food. so this would be, you know, I say probably 60 to 65 % of the businesses that we interact with, on a regular basis. But then we also, yeah, I mentioned earlier, travel, travel agencies. do a lot of, ⁓ blue service home services, type of concepts. So, you know, that's the beauty of, you know, the franchising industry is again, you know, there's obviously an end client and product that you're serving to the community. But at the end of the day, the. product that the franchisor is supplying is actually the business model itself. that's where we kind of step in is to assist in execution of that business model and also provide our guidance and ⁓ on how that model should be structured for that individual brand. Oleksij Rak: Yeah, from what I heard, you have 100-plus clients and you provide services in pretty much every aspect of the business. So you should have quite a significant team that's doing that. Nick Pepitone: Well, so just to clarify, so the 150 is over a 23 year period. we typically, you know, we're typically around on average 15 to 20 clients at any one time we manage. Oleksij Rak: up. But still, you handle locations, the infrastructure, then and then financial services. it's quite a ⁓ problem, supply chain. Is it Do you understand it right? Nick Pepitone: Well, so, what will kind of the breaking apart of, you know, what are what I would call our, our deliverables and then what our design work. So on the deliverable side of what we're executing on a daily basis is primarily on the digital marketing and sales of the franchise concepts. then kind of looking at our consulting business on, on more of the design side ⁓ you know, designing sales process, but also. Oleksij Rak: ⁓ okay. Nick Pepitone: the infrastructure and recommended franchisee, franchisor type of responsibilities, relationships, because those are, it's a very much so relationship business. Once you onboard hundreds of ⁓ so that's a big part of it. So ⁓ far as franchise performance groups execution, really our bread and butter is the sales and marketing components ⁓ the franchising industry. Oleksij Rak: ⁓ And is maybe the typical pain point that every franchise goes through when they try to scale? At some point, ⁓ just breaks. So every business breaks at a certain point when it scales too much. ⁓ that's probably why we help them and fix it. Nick Pepitone: Yeah. Right, yep. Yeah, I would say that. Yep. And I would say the two biggest kind of pain points that we hear on a daily basis is number one, the things that got them there to the point that they're at aren't working to get them to the next level. the way that they marketed, the way that they ran sales process, the people who they had, you know, on those tasks, aren't necessarily the people, the processes or the systems, they're going to get them to the next stage. So obviously talking through and understanding, you know why that is how they currently are executing and you know offering Some some strategic insights into that and then the second kind of aspect to you know Breaking undergrowth that we see is you know, again the responsible franchising week. We jokingly say You know not this isn't a franchise performance group saying this is the Nick Pepitone saying, you know But I know people in the industry and the joke has always been You know, the easiest thing in franchising is actually to sell a franchise. But the hardest thing to do is actually get them open and maintain success and as you scale. And so, you know, if you think about a concept that, you know, has 20 to 30 units, obviously, you know, yes, 20 to 30 is a solid number, but that's a lot easier to get your arms around and ensure consistency of product or service, consistency of branding. Oleksij Rak: you Nick Pepitone: versus when you get to 150, 200. And so it's always looking out ahead of really from an infrastructure and capital standpoint from a brand, at where they wanna go ⁓ always being ahead of that curve and setting really setting the and making it, making the timing right opposed to waiting for the right timing to make certain decisions around hiring and. ⁓ Oleksij Rak: you Nick Pepitone: investment. Oleksij Rak: You mean in the mother company? And like, okay, again, out of curiosity, like whose pain is like, is it the most like, was it a franchiser or franchisee? When opening in a new location. So like, who works most? The guy who runs the local entity or the like, the parent company? Nick Pepitone: Yeah, that's a great question. think that's where sales team, so when we do the outsource sales, we're actually handling those interactions with those local operators who are interested in acquiring a franchise concept, becoming the owner and really ⁓ in. And so I think where ⁓ biggest discrepancy we see on that side ⁓ the expectation ⁓ what it looks like to ⁓ be a business owner and small business owners specifically. I think in today's day and age in the social media, you see passive own a business, ⁓ mailbox ⁓ And the end of the day, that's just, there's no free lunch in life, right? And so it's making sure that we're attracting ⁓ and selling to the right type of operators who understand. Oleksij Rak: Yeah. Nick Pepitone: work that goes into ⁓ only learning the brand, learning the product, but also then hiring, training, retaining a solid staff at the local level. So I never discount the amount of work that goes into the franchisee side. Actually, I started in the franchising industry as a franchisee myself. So I owned a quick service juice and smoothie bar. And I was in my juice bar at two in the morning, cold pressing juices. Oleksij Rak: you Okay. Nick Pepitone: And then back in at 7 a.m. mopping floors and cleaning toilets. that is it's definitely hard work on that side. But the franchise or side, obviously, there's a lot of work that goes into building these out. And then also, you again, the personal connection that goes into, ⁓ you the the franchises that they sell. So they have a vested interest in those franchisees being successful. Yes, obviously, from a business standpoint. Oleksij Rak: you you Nick Pepitone: but also from a personal standpoint, especially early on in these brands, the individuals that you're selling franchises to are making significant bets on the brand and the people, and you want to make them feel justified and feel like they made a good decision. And so the franchisor side, maybe the day-to-day work, might not be sweeping floors and cleaning toilets, but there's a lot of anxiety and a lot of stress with the weight of trying to grow the brand. make people feel validated in their choice. Oleksij Rak: Yeah, that was my question that you already asked. I was about to ask you, is it true that it's semi-absent business? Or you just buy it and forget? Nick Pepitone: ⁓ I, and some of some of our clients who work with now might be saying, Nick, don't don't say this. Don't put this out. Yeah. But ⁓ it's ⁓ I've been the believer of, you know, passive. My ⁓ my dad up in New Orleans and so Mardi Gras parades are big time there. My dad's favorite saying is you're either in the parade or you're not. ⁓ And, you so when I look at semi passive, ⁓ you know, in the franchising industry. I'm always a little skeptical not to say that they're not out there But I would say especially to start, know the first I'd say 24 to 36 months Yeah, I look at every investment and opportunity as an active ownership position. You might not necessarily be the one Serving serving behind the counter or carrying out the home service yourself personally, but there's some form of engagement and accountability that the owner takes on in the early stages to make sure that, you know, again, the consistency of product, the consistency of branding in the marketplace is being held because, you know, ultimately what you're buying in a franchise is the business model and the franchisee needs to make sure that they're executing that each day until they can, you know, step back. Obviously the goal is in every franchise concept, the last thing. Oleksij Rak: you you Nick Pepitone: we would want as someone to acquire a franchise and then for the life of the 10 year franchise agreement, be having to work, you know, eight hours a week stressing about their business. That's definitely not the goal, but you know, having a short term vision of what it looks like from an investment of time is definitely warranted. Oleksij Rak: And with regards with current trends efficiencies, automations and stuff, do franchisees expect or demand from the parent company to be operationally efficient operationally excellent? What's in play? Do you have some examples how it works in terms of automating every step of the process? ⁓ Nick Pepitone: Yes. Yeah. So, you know, and it's really across all functions of the business where that expectation comes in. know, the first stages. Yeah, I joke that franchisees don't really care about how efficient or automated your sales and marketing processes are to get other franchisees. That's not, you know, in their purview. But, really, once someone signs an agreement ⁓ ⁓ the day that they're looking for efficiency and automation. And it starts. really from a real estate standpoint. So for those concepts that require a brick and mortar location. And so we've seen over the last really 10 years, but over the last two years, sophistication has really entered the real estate marketplace and having platforms. work with a platform called Site Zeus that does a great job that run predictive analytics ⁓ on certain across the country. ⁓ And really be able to pinpoint and identify what we call a heat map so we can show us you know the markets where based on our target demographics and target buyer profile where the most you know successful locations should be placed and then you know, we'll actually run predictive revenue models and cost of goods and labor metrics based on local data, so You know, that's a very specific example Oleksij Rak: Wow. Nick Pepitone: You know, just on the real estate, on the operations standpoint, you know, I mentioned. Oleksij Rak: Excuse me, and how much could it differ in terms of revenue if you choose the wrong location? believe it's significant. Nick Pepitone: Yeah. Yeah, yeah, location, location, location. It's, you know, especially in, you know, when we talk about quick service restaurants, specifically, you know, making sure that you are in high traffic areas, high visibility areas, but also, you know, the one thing that people don't think about is what the co-tenancy, so what other businesses surround me, what's going to attract people to the area. You know, it's identifying you're a destination type concept. So something like a gym is to be a destination concept where people, blatantly coming to, they may be coming to a specific shopping center to come work out. If I'm a non destination type concept, like the juice and smoothie bar I was with, I would say, Hey, I want to be around as many gyms and ⁓ study studios that are driving people to a specific location. But then they're a part of my target buyer demographic. And they're already there. They might as well stop in, order a juice, order a burrito, whatever that might be. And being very mindful around those types of co-tenancy. Oleksij Rak: So you help companies provide this kind of intelligence. That sounds awesome. And what else? Nick Pepitone: Yeah, so I joke, I say we don't provide the data. We have third party partners. We know how to utilize the data. And for the clients that we work with on the sales side, our sales recruiters tap into this. And it's really helpful on both sides of the franchisor and franchisee landscape, because obviously performing locations are producing higher revenue for the franchisor. But then that's also a way for us to predict success rates for franchisees. again, going back to that personal connection that we make when any person you sell a franchise to, you're rooting for them. You want them to do great. And if we know that, this is a market that can actually do really well. And if we can find a location in this area, we feel pretty strong that we're setting this person up for success. So there's ⁓ benefits to feeling good about what you're doing as well. Oleksij Rak: Awesome. What else is there to automate before I interrupted you with locations? Nick Pepitone: Yeah, no, no, it's ⁓ and don't don't feel bad for interrupting me the real estate software that's out there. There have been many sleepless nights where I've just nerded out on it. You know, and, and tying in you can, you can refine your searches based on so many data points. So don't feel bad for cutting me off. It's a very interesting topic that you could probably do a whole separate podcast on. But you know, other areas, you know, specifically are around, you know, ease of ordering. So we're in a time where people are on the go and the expectation is no longer want to park their car and have to get out and go wait in a line and wait a product or a service to be delivered ⁓ within 20 minute timeframe. People have the expectation of, I pull up, I can stay in my car, it can be brought out to me. so, the age of obviously every concept having their own mobile app delivery service curbside, you know, are big proponents. it's what I, the reason why I bring that up is that also ties into the digital marketing side. And so what a lot of brands have recognized is, you know, that, that customer data is gold. And if we can not only utilize our app and our mobile services to deliver a better product a more efficient way. We can also tap into and really ⁓ who our clients are, what their buying patterns are, where they're coming from, what types of businesses are they to and be able to really pinpoint and target that buyer profile from a marketing standpoint and create the opportunity to reach more of those individuals. Oleksij Rak: Awesome. And while you were talking optimizing user behavior, not user wasted time, is ⁓ an issue, is there a market for ordering while you go, ⁓ on the go? ⁓ don't know. I will be there in 10 minutes. I want to just pick up. ⁓ Nick Pepitone: Yeah. Yeah. And it's, um, you know, obviously the, you know, we all know the third party delivery apps. also, they now offer, um, you know, where brands can actually white label their own service through a door dash and Uber eats and those things. So that's more outside of the four walls, um, of ease, then inside of the four walls, um, there are, um, partners who can build out, um, those services, you know, one, one of the big players in the space is called Toast, a point of sale systems that are publicly traded entity. They started out as simply just handling the point of sale software for ⁓ service restaurants and full service restaurants and have quickly scaled into really a service ⁓ software provider across the entire organization. delivery and efficiency, even inventory controls have kind of creeped into their premise as well. So there's a lot of great tools that give the brands the capability to execute on it. Oleksij Rak: Yeah, interesting. With regards to the trends, we touched a bit about user behavior and stuff and automating everything. What else do you see in the market? There is a new generation of human beings, Gen Z, and there is also AI. Sure, AI cannot replace the waiter in the restaurant, but still, how does it touch you? And what Nick Pepitone: Yeah, I would say one of the fascinating parts to our business that we've seen the biggest behavioral change over the last 10 years the buyer journey when it comes to buying a franchise. historically, what that process would look like ⁓ is would submit an inquiry to a brand and there be a gatekeeper at that brand who would have all of the information, all of the content and really you know, you didn't hear a lot about it until you got on the phone with them. And so you were incentivized to schedule pre-qualification and discovery calls. And you were at the mercy of what they were able to send you. And so in that, in that system, the power balance was really held by the franchise or they could dictate the flow of information. And what we've seen is, you know, the buyer journey has become so much self-directed. in the age of information and with everything being at our fingertips and being able to research, but also, you know, with the franchising industry becoming more regulated, more things becoming public knowledge and available, is a good thing. ⁓ ⁓ ⁓ to make sure I point that out that I'm all for, again, the responsible side of franchising. And so I want to make sure that, you know, the buyers ⁓ our industry are extremely educated and understand what what they're stepping into. But what it's turned into is, you know, our clients, their content is what earns them conversations. Now, you used to be very able have very little online and supply very little. Now, ⁓ as build websites for our clients and build downloadable content, we, know, it looks like a full blown business plan, a 30 page downloadable ebook. want to make sure that we are flooding the marketplace. you know, we've done a lot of research. and looked at what franchise buyers spend their time researching when researching a brand and how much time they spend. And so we very strategically place deep funnel research on and downloadable content so that when they are getting on the phone for those qualification calls and discovery calls, the conversation ⁓ is more guided based on their questions and comments on what they've already consumed. Oleksij Rak: Hmm. Nick Pepitone: And then further education of the brand. so it's been a massive shift in the industry, but I would say that it's also been a net positive for the industry because I think a lot of the brands who warrant the interest from buyers receive it because their story gets told. And it's not just relying on a really good salesperson to run people through the funnel. ⁓ really have to earn the to speak with people. Oleksij Rak: That's really interesting. That's really interesting. And there any marketplaces for franchises? If are no, maybe we should build one. ⁓ Nick Pepitone: Yeah, so, well... Oleksij Rak: I said, you know a bit about franchises, we can combine them. Nick Pepitone: Yeah. ⁓ like the thinking and it's ⁓ reason why I laughed. our founder ⁓ Franchise Performance Group, Joe Matthews, he's shifted into a chief strategy officer role. And he's had this idea for years. And ultimately we, ⁓ you know, unfortunate part of franchising is it's an extremely inefficient marketplace. There is ⁓ you know, when you look at going to buy a house or buy a car, there's places like Zillow or cars.com where you can go and, you know, really refine down and learn and do research across the entire landscape and then parse down on what options really fits your needs in franchising industry. While the individual brands, you know, it's on my previous point have to earn conversations based on their content. there's really no one place where a buyer or investor can go to really refine down and understand what brands are fitting their parameters. so it's an idea we've kicked around at Franchise Performance Group. You it would be a tall task and obviously getting not only you know, it's really both sides of the fence, getting franchisors ⁓ and franchise ⁓ on board with it. ⁓ And so no Oleksij Rak: Absolutely. Nick Pepitone: Definitely no small task, but it's something that's been in the back of our heads because that's at the end of the day, we want the brands that deserve to be at the top to continue to rise. we want franchise buyers to be impacted a positive way for leaping into the entrepreneurial realm and being for making the right decision and choosing responsible franchises. Oleksij Rak: Yeah, marketplaces as well. I always say chicken and egg problem. You do not have buyers until you have sellers and vice versa. You just need to get rolling at some point. But you have a big plus. You have large list of contacts of franchisees already which you can onboard into the platform. Nick Pepitone: Yep, yes, we'll have to do a separate call or we could dive into it. Oleksij Rak: That sounds really interesting. And there is a lot of interesting features that can be added of intelligence, like you mentioned, in terms of where and of travel, like heat zones and all this kind of stuff. Does it fit? Does it not fit? Was it space requirements? Whatever. don't know. But it sounds interesting. What other trends do you see? Maybe in terms of AI, ⁓ there anything touching like this business? Like AI marketing, predictive staffing? chatbot supports whatever whatever that can be into Nick Pepitone: Yeah. Yeah, I would say we, yeah, our stance at Franchise Performance Group on AI is, know, we, especially on the content side. So when we're producing copywriting and content for our clients, we want to, we want to utilize AI, but we don't want to depend on it. You know, because the franchise buyer can see that they recognize that there's still a personal touch that is required for, you know, an investment of this size. So. But there's also that we utilize just from an operational standpoint that utilize technology to make us more and increase automation. I'll be interested to see where AI takes the franchising industry a whole. I've got a lot thoughts on AI. ⁓ And ⁓ I think those who have heads buried in the sand and want to deny that it's going to be this thing that we have to learn or going to be in trouble. I don't necessarily think that it's going to take over our lives. I, at least that's what I hope. hope not. You know, I'm, I'm a believer of, know, you have to be open and willing to learn it and utilize it. it's, you know, the folks who ⁓ are to leverage it ⁓ are to be a leg up. And so that's, know, internally we're, you know, our Monday meetings, we have a portion of it where we're constantly talking about, what What are some new ideas? What are some new platforms? What can we utilize internally? What can we utilize for our clients? Because I think it can definitely tap into some streamline operations for us personally, but also obviously for the services that we provide. Oleksij Rak: you Yeah. I lost you for a second. That's fine. In terms of AI, I absolutely agree with you. It's kind of a tool, know. It's a very powerful tool. And like in the age of industrial revolution, people who could leverage of new tools that were like burned at that age, they could benefit a lot. Goods still were produced, but they were produced more efficiently and with better... Nick Pepitone: ⁓ yep. Yeah, yeah. Oleksij Rak: And those who wouldn't like adapt, failed. probably at certain point will have to adapt to the change, to the new tools. Nick Pepitone: Exactly. I was just speaking with a good friend of mine who runs business here in Texas. He was telling me ⁓ he launched a clone of himself. So I'm to hear the results. He said he got pinged that it already hit his budget within the first two hours of work. So waiting ⁓ to what the are. I'm very intrigued on what those capabilities are. Oleksij Rak: Okay. Yeah, yeah, that's interesting. With regards to the franchise performance group, what are your plans? What are you building right now? How does this market shift affect you? How do you address them? What are you building, especially what are your betting about the future? Nick Pepitone: Yeah. So, you know, really what we're leaning into right now, you know, our founder, Joe Matthews really built the brand and the business on thought leadership and education and being at the forefront of the franchising industry and sometimes even being a contrarian, uh, to, you know, what others in the marketplace were saying. And so we're, you know, we're in the process of leaning back into that. We're actually refreshing, um, some educational content. and going to be putting that out later this year. also looking at building out, you know, further infrastructure from, from just a team standpoint on RN as we ⁓ really at, you know, take, take hold of the marketplace. I think we'll really lean into some of our sales capabilities. We've got, we've got a fantastic team. And so I think it's, it's leveraging those individuals ⁓ implementing. uh, you know, technology where possible to, to make them, you know, go further, but then also really, um, investing in our infrastructure. think, you know, it's a really exciting time. You know, we mentioned right before you and I jumped on, I just joined franchise performance group, you know, in 2025. so, you know, growth is at the forefront. Um, but sustainable growth is, the goal. And so doing it the right way. Uh, and it starts from the inside, um, of our business. And so that's really where my. Oleksij Rak: you you Nick Pepitone: my focus has been. And, you who knows, maybe one day that longer term visit you and I will be unveiling the marketplace for the franchising industry. Oleksij Rak: . Who knows? if, ⁓ you jump into details? Like what exactly is it like you're trying to build inside? Like by saying the platform, like ⁓ that? If could share. Nick Pepitone: Yeah. Yeah, yeah, no, absolutely. So, you know, I think historically, you know, we have run as a very lean organization. for reasons. But as look out, you know, at our clients needs, ⁓ and also skill sets of our team, we have the capabilities and capacity to bring on more clients and grow in order to do that. You know, we can't stay We can't always do what we've always done. You know, to the point earlier that I mentioned, you know, we see it in our clients. What work to get us to where we are in 2026 isn't necessarily going to be the same strategy that is going to get us to where we want to be in 2036. And some of that is investing in additional talent and some skill sets. You know, we've recently brought on a dedicated content strategist who produces you know, monthly content pieces, updating ad creatives, we're driving ⁓ more leadership, actually ⁓ interviewing some new leadership over the coming weeks to really be able to scale. So there's some things still working through, you know, on what that all is on the specifics, but growth, and I think it starts with building a moat around what we're really good at. and expanding our capabilities in areas that have high synergy with that. Oleksij Rak: The content theme, mean, like, that like for your marketing or is it for clients' marketing? ⁓ Nick Pepitone: Both, both. we treat Franchise Performance Group as a client. yeah, so, and it's also, ⁓ the joke ⁓ the builder's is never finished. So ⁓ at the of the month when we look at, yeah, hey, we've got to get content out, we've got to do this as, ⁓ the first that gets pushed to the bottom is Franchise Performance Group. Yeah, and that's. Oleksij Rak: Thanks. there. Nick Pepitone: ⁓ always willing to sacrifice our own publicity to make sure that our clients are coming first. And that's a part of that building up structure is to ensure that ⁓ the ⁓ and that we give our clients, we can also do for our own business to ensure that we're investing in Oleksij Rak: you Awesome. Great. Yeah, that sounds like a really healthy approach and you just do what you do. That was really great conversation for me. I learned a lot today about franchises and it's really interesting, so we should discuss it further. Nick Pepitone: Hahaha. Yes. Oleksij Rak: there anything else you would like to add to that that we discussed? Nick Pepitone: no, just listening back ⁓ my head. think ⁓ only other change that I would say that I've seen in the marketplace has been private equity coming into the, to the franchising world a lot heavier over the last handful of years. ⁓ some of the dynamics and landscape changes have been driven by private equity coming in and professionalizing businesses and requiring a lot more visibility. efficiency from an operations and financing standpoint. So that's changed a lot of things. ⁓ think only increase. Franchising is of those industries that tends to be, you don't have direct experience within it, you seem to considered an outsider. And so it's really to keep people outside of it. But I think it's going open up more and more. And I'm a big believer of having the right people in the right seats, regardless of their experience or industry in. that'll be a shifting, I think a continued shifting landscape that we'll see private equity ⁓ the space as well. Oleksij Rak: By the way, since you mentioned that, it sounds like somebody has more money ⁓ into the play. But ⁓ also hearing that people having less money in terms like I'm interviewing a lot of travel industry, people from travel industry, and they see the trends that people... Nick Pepitone: Hahaha Oleksij Rak: saving more, maybe because they have less money because they are more cautious about where they spend money. But it's about franchisees themselves ⁓ because But rather do your clients experience in their networks of restaurants and so on. Do they experience any kind of decline in Nick Pepitone: Yeah, discretionary spending areas like food, definitely be trends to that. But I will are the best brands that we work with are still seeing year over year increases on the top line without requiring price increases. Sometimes I laugh you hear somebody you had over year revenue and then you say, ⁓ well, you raise costs 20 percent, of course. Oleksij Rak: Go. Nick Pepitone: Yeah. Revenue was driven up. that's not necessarily been a requirement of that. think, you know, we're seeing it some on the investment side of franchising with new franchise buyers coming in. ⁓ And wouldn't necessarily say it's, it's lowered the number of franchises that get sold on an annual basis, but it definitely, makes the process a lot more important. People are really looking into, the financial aspects of the investment. and the return on their investment. It's less, it's less what we would call passion players. So people who are enamored with a brand or a product or service and just want to be a part of it very more. They like brand, but tell me how I'm going to, you know, perform from a financial standpoint, which again, I think is, is ⁓ only beneficial and ⁓ you the brands deserve that recognition and praise and growth. are going to get that because they have more proof of concept. Oleksij Rak: Okay, okay. That's the hypothesis I wanted to adjust to check and since you mentioned money. interesting observation. Awesome, awesome. Thanks lot, Nick, for coming over. It was a really, really great discussion. And of for you in this role since just ⁓ recently started. And of luck for your company. Thanks a lot. Yeah, me too. Cheers. Nick Pepitone: Fantastic. Thank you so much for having me. I appreciate it.