Franchising comes to Niche Publishing
Can niche publishers find a new business model by franchising – that is, selling a turnkey game plan and using the central office to supply critical support for franchisee operations?
It is a model that may allow start-ups to have all the advantages of being part of a centralized corporation while maintaining ownership.
One publishing company is already doing it. Tom Britt, CEO of Towne Post Network, headquartered in Fisher, Indiana, has sold 18 monthly local lifestyle magazine franchises in Kentucky and Indiana for $35,000 each and continues to provide centralized editorial, production, printing, and circulation services in return for a revenue share.
Brandon Baltz and Darren Boston, who both came from a sales background and now own six of the 18 hyper-local glossy magazines in the Network, told attendees of an Editor and Publisher webinar that they made the investment back in a few months and enjoyed their new role as publisher.
While small, the magazines have big margins, with an average profit of $114,798 and a network high of $233,992 on average annual gross revenues of $248,640. Keeping more of the money from their sales, having a turnkey start-up, and no responsibility for accounting and administration were all incentives for the two franchisees. Britt said he could launch a magazine in about ten weeks, which would be otherwise impossible for an individual to do on their own.
While Baltz and Brandon sell and represent the magazines around their towns, Towne Post does almost everything else, including billing, production, printing, mailing, and editorial, even hiring the writers. Britt handles mailing 10,000 to 20,000 homes in each franchise area using a purchased list. The publishers also distribute another 1000 or so to high-traffic locations and come up with story ideas, which Boston said was never a problem.
“My phone and email are off the hook with more story suggestions than I know what to do with,” he told attendees at the webinar. “But if I had to interview and write it up, I’d run away.” He had been a TownePost advertiser with 25 years in sales before deciding to buy a franchise after Britt asked him if he knew anyone who might be interested.
Baltz was a traveling corporate trainer for Valpak, but now he can spend more time at home with his family and take a long weekend. Neither one wants to return to working for someone else again.
Josh Brown, a partner in Taft Law and host of the “Franchise Euphoria” podcast, said franchise law requires additional reporting. He had to persuade Britt, who was selling publishing software and services then and associated franchises with cookie-cutter corporations and fast food, that the franchise model was a better fit than selling services. “He was almost there,” Brown said.
Today Britt said he enjoys having a partnership relationship rather than an employee or customer relationship. The franchisees share information transparently and participate in group calls. “I like to work with peers, not employees,” he said. “We are all owners. We are all at the same level.”
Britt is actively looking for additional partners. “It can be a way out of the corporate world if someone is good at sales and doesn’t want to start from scratch,” he said.
A passion for sales is the most important quality he looks for in a new publisher.
