Start With A Win - Secrets of a Franchise CEO with Jeremy Morgan

Episode Date: July 5, 2023

Adam talks to Jeremy Morgan, CEO of WellBiz Brands.  They discuss the secrets to being a successful multi-brand CEO as well as how to run a small business effectively with highly engaged employees.  This leads to exceptional customer experience!  Listen to this episode for some of those great secrets that Jeremy shares.  Jeremy Morgan is the Chief Executive Officer for WellBiz Brands, Inc, the nation’s premiere franchisor of five beauty and wellness franchise brands: Drybar®, Amazing Lash Studio®, Radiant Waxing™, Elements Massage® and Fitness Together®.  With nearly 900 locations, 350,000 members and $600 million of system-wide sales across the portfolio, WellBiz Brands builds profitable businesses by catering to the needs of the affluent female consumer.  Jeremy began his tenure at WellBiz as the as the CEO for Elements Massage, where he worked diligently to support and build relationships with over 250 Elements Massage franchise owners, a community of 4,000 massage therapists, and over 120,000 members nationally. As a result, he led Elements Massage to achieve its most successful year in performance in 2018, as measured by studio revenue, client growth and customer satisfaction. Due to his open leadership style, he was recognized with a 91% Glassdoor CEO approval rating from the Elements system. Previously, Jeremy was a Senior Vice-President of Marketing and Consumer Insights for Smashburger, and the CEO of Tava Kitchen.In addition to his professional achievements, Jeremy is an active member of the community and supports Colorado Succeeds Board of Advisors, The Denver Boys and Girls Club, The Denver Chamber of Commerce and Duke Alumni Committee Denver, and is a member of the Kellogg Alumni Club of Colorado. Morgan was a member of the Denver Chamber of Commerce 2015 Leadership Denver Class, was recognized by the Denver Business Journal as a member of the 2018 40 Under 40 class of leaders, and is an active member of Young Presidents’ Organization (YPO). Main Topics03:10 How does a CEO divide his time with multiple brands?06:26 Brands are unique, here is what it takes to run a brand.09:25 What does customer experience mean to you?11:49 The number one challenge in a small business!13:35 Best First Day Ever?17:05 Can you transfer culture from HQ to the franchisees?19:53 Best piece of adviceConnect with Adam:http://www.startwithawin.comhttps://www.facebook.com/AdamContosCEO https://www.linkedin.com/in/adamcontos/ https://www.instagram.com/adamcontosceo/ https://www.youtube.com/@LeadershipFactoryhttp://twitter.com/AdamContosCEO Listen, rate, and subscribe!Apple PodcastsSpotifyGoogle Podcasts

What are the biggest challenges in consumer brands and beauty brands today? And what does a multi-company CEO do to grow his business? Today, we talk to Jeremy Morgan and find out. Welcome to Start With A Win, where we talk franchising, leadership, and business growth. Let's go. And coming to you from Start With A Win headquarters, it's Adam Kontos at Area 15 Ventures with Start With A Win. And it's great to see you here today. Today, I have Jeremy Morgan.

He's the CEO of Wellbiz Brands, a leading franchisor of beauty and wellness brands, including Dry Bar, Amazing Lash Studio, Radiant Waxing, Elements Massage, and Fitness Together. Under Jeremy's leadership, Wellbiz Brands has grown to nearly 900 locations. This is a big franchise company, folks, serving 350,000 members and generating $600 million in system-wide sales. Jeremy's expertise in building successful businesses for affluent female consumers is evident through his achievements, including leading Elements Massage to its most successful year in 2018 and receiving a 91%, that's right, 91% Glassdoor CEO approval rating. That means his employees love working at his businesses. Additionally, he actively engages with various community organizations and holds memberships in prestigious industry associations. Jeremy,

welcome to Start With a Win. Hey, it's great to be here. Right on. So you got your hands full, man. And my wife is a huge consumer of all these, so I'm familiar with all of these different brands. So tell me, how did you get, I know you were a Smashburger before and you've been with some, you've been CEO of another business. How did you get to Wellbiz Brands? You know, I've always been really interested in consumer concepts. I started my career as a banker and then a consultant, and I really wanted to roll up my sleeves and be in operating companies.

So I had joined Smashburger early on, was the CMO there when it was early on in a rocket ship. We went from 30 to 300 locations while I was there. And it really was my first foray into franchising. And I really love the relationship part of franchising. And I love Colorado as well. And I had the opportunity to join Elements Massage as CEO shortly after KSL Capital acquired the Wellbiz platform. So I jumped at the opportunity. I'd been a member at Elements Massage for a couple of years before that, actually. So I knew the concept well and spent the first couple of years running the Elements brand and took over the broader portfolio shortly after we started acquiring other brands like the Amazing Glass Studio.

And it's been an awful lot of fun. To your point, it's a handful sometimes, but it's also just a great group of concepts and great group of people that I get to work with all day. So Wellbiz, for all of our listeners, is kind of a holdings company that has multiple brands under it, obviously. When it comes to that corporate structure, how do you divide your time appropriately amongst those different businesses? That's a really good question. We keep ourselves quite busy. We have organized Wellbiz in a way where it is a holding company, but it truly is an operating entity as well. So we have our five brands and we're really deliberate about how we go about selecting concepts that are going to be in our portfolio. M&A is an important part of our strategy,

but it's not the strategy. We are successful whenever we're able to grow units and same store sales within our existing portfolio. So several things all of our brands have in common. You mentioned on the startup, we focus on that mass affluent female customer. We focus on personal services, which for us means one-on-one with another human. So whether that's a massage therapist, a cosmetologist, an esthetician, a personal trainer, all of our brands also focus on a member. A big part of this is a membership based component.

And of course, this is brick and mortar retail in a franchising context. So it's a pretty narrow set of things that we look for to begin with. And why that's so important is because it gets to how my team is set up to drive value for franchise owners. So since these brands have an awful lot in common, we're able to do things like focus on membership sales and having great sales training for the front desk, regardless of which brand we're working with. Or onboarding new franchise owners into the system or the technology that's needed to run those locations. So we don't have independent CEOs of each of the brands. In fact, the vast, vast, vast majority of my team carries a Wellbiz business card, not a brand-specific business card.

And in terms of how I specifically allocate my time, I mean, you know, ultimately part of this comes to with having a very, very strong team underneath me. But I spend a lot of time on all the brands. I mean, it's kind of all day, every day. It's, you know, probably relatively equal across the five at any given time. You know, one brand's probably getting a little bit more than the other, but I think over the course of the year, that probably equals out quite a bit. And you'll notice how relaxed Jeremy is. He probably got a massage lately or something. His hair looks good. Maybe this weekend, maybe this past weekend. That's great. How much of this, being a holdings company, obviously, the idea here is scale.

And this is why organizations go and purchase along a particular niche line or a particular similar customer? Because I would assume that Wellbiz has, you know, their customer base has memberships in multiple of these brands a lot, which is fantastic. You know, what's really what's the best way to grow your revenue? It's to sell more stuff to your existing customers. So you expand your brand line. So what did you do when it came to scale here? Because you've been building this whole thing. And where's the crossover here? You mentioned your employees carrying Wellbiz cards versus the particular brand

of the studio or company or whatever it is. Where's that crossover start and where does it end? And what's unique to these brands? Well, so first of all, the brands themselves are incredibly unique in terms of the consumer experience. No one is confusing an eyelash extension service with a blowout with a massage, right? So making sure that those brands really come to life are best in class in the mind of consumers is incredibly important. But what it takes to run the studios or salons from a franchise owner's perspective, it's probably 75, 80% the same. They need to be able to recruit great teams. They need to be able to train service providers. They need to be able to work with their front desk on membership sales and customer service. They need to be able to acquire great supplies from an interface with a business coach at Wellbiz.

So a lot of that is pretty darn similar. And then from a functional expertise standpoint, some of the things they need, they need fantastic digital marketing to drive people in for the first time that are focused in on that mass affluent female consumer. They need a learning management system to train their employees and their team. They need a real estate team to help them select their next site. So from a functional expertise standpoint, it's all fairly similar as well. What it's allowed us to do is really invest in having top-notch talent in each of these functional areas, but then we spread them out across the five concepts. And any one of those five brands would not be able to have the type of leadership in

technology or real estate or marketing that we can afford as a platform. Now, we purposely acquire concepts that have scale in and of themselves. Radiant Waxing is our smallest brand in terms of units, and it has 70 units. We look for brands that are royalty sufficient going in. We want to be able to invest behind them in order to accelerate growth. Usually when we go in, there's some opportunity area, whether that's how do we do marketing better? How do we do real estate better? How do we give them better training that we want to take our playbook that we know works in elements or an amazing lash concept and context and plug it in. So we have a good idea of what we want to go do there. But it works really, really well. But at the end of the day, the

backbone of this, which is the part that frankly isn't about scale is it's the relationships with franchise owners. Relationships aren't a scaling thing. You have to have one-on-one relationship with folks there. They need to know you and the leadership team. You need to know them. And that's where we try to really make sure that we're not cutting G&A tight, that we're still kind of locked arm in arm with those franchise owners and on the things that they need to grow their business in their trade areas. Wow. So you talk about the relationship, you talk about the interaction with the customer, the GNA, and not, you know, not eliminating things that make a difference here. Talk to me, well, first of all, Forrester Research has said that in 2023, the key to winning the game is the customer experience, to be obsessed with that customer experience.

Tell me what that means to you and to Wellbiz Brands. Well, it really starts, first of all, the customer experience is more than what happens in the four walls. It starts online. It starts when they're investigating about going to get an appointment. It includes your online properties, your apps. It certainly includes the experience within the shops. And then it includes the follow-up afterwards. We're a membership-based organization. So this is really, we encourage our owners to think about this as a community.

This is a long-term relationship with clients. Of course, we need to make their hair look great, their eyes look great. We need to make them feel great. But there's a lot of options for going and getting massages and personal training and other places. So it really comes down to how the service providers are able to build a relationship with clients at the same time. You know, you mentioned our net promoter scores at Elements. All of our brands have really high net promoter scores. Fitness Together is even higher than Elements, all of our brands have really high net promoter scores. Fitness Together is even higher than Elements. And it gets to the strength of, I think, how we go about really working with clients, making sure that it's great. It starts with franchise owner selection. We spend a lot

of time with franchise owners. And it's actually, we talked to them about the customer experience, but we know that the way that the franchise owner talked to them about the customer experience, but we know that the way that the franchise owner is going to make the customer experience great is if they make the culture at their studios great and hire great teams and retain great teams and work with their teams. The owner's not the one that's necessarily interacting with the customer day-to-day, but boy, those service providers, that front desk is. And if you have an owner that has bought into that idea from the very beginning, great things will ultimately happen. And we really try to make sure that we're solving for that upfront with the type of people that we award franchises to. That's great. And you have to have employees that operate in all of these franchises and work

essentially for the franchisee. There's a lot of owner operators out there, which is predominantly what franchising is. Then we have a lot of multi-unit who are people that are running a business of multiple units. But you're 100% correct. It comes down to how does that leader in the store, the individual franchise location, create a great experience via their employees. And at the same time, that seems to be the biggest challenge in small business in this day and age. Number one problem, folks, is finding and creating talent and not churning that talent out where you're continuously rehiring and starting over again.

Jeremy, do you guys have any strategy for how you get your franchise leaders to model that leadership so that they can get those right budding professionals? I know you're part of YPO and things like that. And that's a, you know, big component of how do we grow leaders, but how do we get franchisees to grow leaders so that they can keep long-term employees that do a great job. Well, you are absolutely right. It's like the key unlock for most of all businesses. And it's particularly acute for us because I think it's our biggest strength. All of our experiences are one-on-one with another service provider. It does mean that we've got some moats around us in terms

of everything going online. You have to go see a person to get a massage, get a blowout, get a wax. So that's great, but you better be really great at building teams. We actually, it's an unusual group that we have on our team. We have built a people team in-house, which helps a lot with both recruiting and retention. And in franchising, there's always joint employer concerns. And we make sure that we're staying on the right side of the line on those things. But it's just our employment brands are as important as our consumer brands. We need massage therapists and estheticians and personal trainers to really be excited about working at one of our concepts.

So we have a team that helps focus on that, both our reputation there, but also just gets in the weeds of how do you recruit folks? What are the, what's the strategy? How do you, how do you onboard them? One of the things that we have at all of our concepts, we, it's something we call best first day ever. We want to make sure when someone starts that they are welcomed with open arms and it's everything from, I mean, it's, it's small things, but it gets to the culture. It's balloons in the break room and lunch with the manager and getting your eyelashes done for the first time and getting on board in the system in a way that just really excites the new employee

and gets them engaged from the very first moment that they walk in the door. And something we talked to our franchise owners and their managers about to make sure, you know, they can put their own twist on that. But the notion of let's make this really exciting. A lot of times, folks that are starting at our concepts, it's their first job out of beauty school or massage school or whatever else. And so, you know, this is their, this is their first time. This is exciting for them and making them feel welcome and that this is going to be their place is part of the strategy. Best first day ever. I, I think there's a, there's some gold in that one

right there. I wish I could say I came up with it, but it, you know, it gets to the folks on our, on our people team that like really spend a lot of time thinking about this every day. And how do we make that come to life for everybody involved? Well, and you think about it, what happens when somebody has their best first day ever? Especially the demographic that you guys are hiring for these businesses. They go tell everybody. It's on social media. They're telling all their friends who are telling all their friends.

And you build up this foundation of people that go, oh, I want to work there. It's on social media. They're telling all their friends who are telling all their friends. And you build up this foundation of people that go, oh, I want to work there. And it's community. It's community. And look, these folks just graduated from beauty school. They know a lot of folks in beauty school. And it gets to, you know what I said, that employment brand matters a lot. So if your employment brand is these people are a great place to work, this best Thursday ever was awesome, they pay fairly,

they build a culture around how you can advance in your career, and that starts with day one, I mean, it makes a really big difference. I mean, there is, again, a lot of places they can go choose to work that have similar opportunities to do waxing or personal training or whatever else. They've got a lot of choices out there. And probably on the margins, pay is important. You've got to be competitive. But on balance, if you're the best place for them to work and have fun doing what they went to school for, you're going to win.

And you're going to have no problem filling your employment roster with folks that are really passionate about what they're doing. And man, if, if you have a passionate employees, especially in our space, that's going to show up in that customer experience. All you almost don't have to worry about the customer experience at that point, if you have a happy team and as a franchise owner at the top, like your job isn't to go, you know, put the eyelash extensions on somebody. It's like, how do you set the tone? How do you make it a great place to work?

And then great things will happen. That's an interesting concept to fall into there because you've mentioned culture several times. And then what you're talking about is that continuous evolution of culture. Culture is probably one of the biggest, other than, you know, obviously personnel, but we need a culture in order to attract and retain personnel and develop them. How do you as a franchisor of these multiple units, and I feel your pain on this one also

because having run multiple franchise brands, you look at it and go, how do I translate my culture from headquarters to the franchisees, to the employees, to the customer? How often do you talk about that? Or is there anything in particular that you guys work on at Wellbiz in order to ensure that happens? It's probably one of the trickiest parts of having a multi-brand platform because, I mean, as you would want it to be, you know, Drybar has a different culture than Fitness Together. And Amazing Lash has a different culture than Elements. They all have great cultures, but they are different. Their values tend to be pretty similar, actually, but it's really important that you don't just try to peanut butter across and make them all exactly the same

because like you'll lose it all in that in that process and some of its little things with with our team our team does almost you know to a person engage with multiple brands like we're and I think it's one of our strengths because we're able to see the pattern recognition about what's going on across the country in different contexts. It gives us more data points. It makes us a lot stronger on the business side of things. But if we're not careful, it can become a weakness on the culture side of things. So I'd say a typical person on my team, I know I do this, it's such a silly thing. I have over on the side here, I probably have a yellow shirt, a pink shirt, a purple shirt. I mean, like literally if I'm going to be on a call, I'm going to make sure that I'm showing up for dry bar

at that moment. Like you're not going to see me in a fitness together shirt on an elements massage call. I need to be kind of in that mode. Similar when we're on the road, you know, we're going to be, you know, if I'm going to go to Atlanta, I'm going to visit all of our different concepts that are in the area. We do bring our owners together, by the way. It's important for them to know each other. There's a lot they can learn from each other. So we kind of have our own well-biz culture, but the culture within the shops are a little bit different. I would say that it's a work in progress. Some of our brands have, as we acquired them, came with stronger culture than others. So we've had some that we've had to build. We've had some that we've had to really kind of maintain

and adopt some of the, be a culture warrior for the things that they already have that are going fantastic. And it's part of the fun piece of it. I mean, you can almost tell my team, my team often laughs about this. We just had our annual franchise conference where we bring all five brands together.

Probably without even talking to someone, you can almost tell that's a dry bar person, that's an elements person, that's a fitness together person just by the things that they value, the things that they talk about, the way that they carry themselves. And it makes it a lot of fun

to be able to kind of code switch between the different brands. Cool. I love that statement. Be a culture warrior. That's, that's pretty cool. What's one of the best pieces of business advice you've ever been given when it comes to running all of these small businesses? Oh, my goodness. First of all, like I, I'm always looking for advice on what to do. These are different. All these concepts are different. I probably one of the best pieces of advice overall is to, especially as a, as a leader is to have, have very strong opinions that are loosely held. And that, I think it helps particularly as you, you know, if you're in acquisition mode, like we are, um, sometimes like it lets you get in there, exert, hey, that's just what I think. And let people kind of, you know, change your mind or prove you otherwise. And use that as a way to get the team,

like you might find that like, hey, everyone agrees. And okay, let's go like march forward. Or hey, this is an area where like, there's a totally different way to go about it. And if you keep an open mind on it, that's great. My team knows that I do that. So it's important, I think, for your team to know that that's almost how you do it so that there can be a sense that don't disagree with the CEO and, okay, that's what he wants to do. So I guess that's what we're doing. But it's a tool as much as anything. And I've found it very useful as long as the team knows that you've got a flexible mindset on those things. But I think it opens up the learning. I think it opens up the conversation and it kind of skips to the end a lot of times in terms of like, what do we need

to go do next? And it really lets you find out why something might be a bad idea or why it's a great idea. Awesome. And it shows your, your vulnerability as a leader. I think people really appreciate that as well. And your humility, you're, you're not an ego guy. You're a let's get it done together guy. It's, it's pretty cool. So, um, you can't, you can't be a guy running female beauty brands and not be pretty humble about the fact that you might not know everything about what that experience looks like. So you kind of learn early on, like, look, here's what we're doing. And I'm pretty good at building teams and doing some of this stuff. But there's probably some things that a lot of people know about eyelash extensions and waxing and blowouts that like just, you know, aren't going to be second nature for me. And I think as a leader, if you show that vulnerability, show the ability to change your mind, tell people, hey, you know, great idea. You're right. Man, I was off base

on that. Like you do that a few times in public settings. It really lets people, it opens up in a really big way people's willingness to share things with you and share ideas with you and get makes the organization better over time. That's, that's fascinating. It's an interesting perspective that, you know, as a CEO, you have not experienced all your products. So I tried, but like, it's not quite the same. It's not quite the same, you know, putting eyelash extensions on for an hour, like, you know, they're coming off after that. So I know what a service is like, but I don't know what it's like to carry eyelash extensions on for two weeks. And nor am I going to, right?

So and when that customer experience is such an important part of what we do, it's like, okay, well, how do you make up for that? You know, part of that is you surround yourself with people that do understand it really well. We've got 130 people on the Wellbiz team. 75% are women, as you would expect in this kind of categories that we play in. And it makes it a real strength for us. That's awesome. That's awesome. Jeremy, I have a question that I ask all of the great people on Start With A Win, and I get some incredible answers out of this. And that is, how do you start your day with a win? Oh, that's really funny, because I think people that will listen to this that know me well

are going to be like, really? I'm really surprised he's saying that. But I do – I start the day – I go to fitness together actually. I start with a workout. When I was in college, when I was younger, I hated going to the gym. It was just – I was not a guy who liked to go to the gym. I still frankly don't enjoy it all that much as I've gotten older. I know how much better it makes me. It is, it does help me start the day with a clear head. I'm not getting on my phone right

away. I'm still not an early morning person. We laugh in my house. Like we, like even this morning, we woke up at seven and it's a little bit of chaos until the kids are out the door by seven 30 and then straight to the gym. And then I can, you know, kind of reground myself and get going. So that's usually about four days a week that I, I try to do all during the week and it just kind of gets me into the routine and gets my day going. Awesome. Yeah. I'm with you. I don't, I don't like

going to the gym, but I like the results from going to the gym. So, you know, it's, we, we look for our college buddies would say like, you're saying you start the day going to the gym and that's like how you, how you start with the wind. My goodness. Like where was that 20 years ago? People evolve. So exactly. Anyhow. All right. Well, Jeremy Morgan, CEO of Wellbiz Brands, make sure you go check out all of their amazing brands. I know we are a big consumer in our household. Thank you for being on Start With A Win. And thanks for all you do as a business leader. Yeah, thank you for having me. Appreciate it, Adam. Thanks for joining us on Start With A Win. Be sure to like and subscribe to this episode and share it with your friends.

Also, be sure to check out Adam on YouTube at Adam Canto CEO, as well as on all the social media platforms. And don't forget, start with a win.