SPEAKERS
Speaker 2, Speaker 3, Speaker 1
Speaker 1 00:00
Nick, welcome to the Sport Clips franchise development podcast. Your go to resource for what makes the top rated men’s hair salon franchise a compelling opportunity. Today we’re speaking with Nick Choate, owner of multiple Sport Clips locations in the Sarasota area of Florida. Nick comes to sport clips after decades in the corporate world, where he had successful careers with some of the largest companies in the world, including Disney, looking for a business he could run with his wife, Nick chose Sport Clips because he wanted flexibility, work, life, balance and the ability to scale, all of which he found at Sport Clips. At the time of this conversation, Nick and his wife are exploring two more Sport Clips locations to add to their portfolio. We talk about all of this and so much more, and without further ado, here’s that conversation. So Nick, can you tell us a little bit about what you were doing before you became a team leader with Sport Clips.
Speaker 2 00:57
I was for many years, maybe too many years of corporate want. I kind of describe myself. I was in the technology industry for probably close to three decades, various big companies, some smaller ones, so but it was mostly in the technology space. My last gig, which was interesting, and I think it helped prepare me professionally for what I ended up doing with sport clubs. Was the Walt Disney Company, as a lot of people could imagine, not having been inside, it’s probably what you would expect. It’s a company that’s very obsessed with guest satisfaction. It’s very detailed oriented, and that I found that even though it was later in my career that that was good training, just to really, really drive the importance of those things home and make it a part of, you know, your intuition, almost you don’t even think about it at one point. So, so I was doing that, but when I was leaving Disney, I was talking to other companies, similar industry, and I just got to the point where it’s like, yeah, I just can’t, I can’t, I can’t keep doing this. You know, in different different company names, different aspects of the industry, lot of the same challenges, and this, yeah, God really needed to change. And then Sport Clips came along.
Speaker 1 02:18
So what was it about sport clips that made you feel confident that this was the right decision for you.
Speaker 2 02:23
Well, what was interesting is, when I first got connected here, loosely to the franchise industry, I didn’t know a lot about it. I mean, it never had been part of it, you know, obviously I, you know, I could buy fast food, just like anybody. So I got that aspect of franchising, but never really from the point of view of maybe I can own something the franchise industry. Just by chance, I got connected with a franchise consultant whose job is to take you through the decision process. Are you prepared to do become a small business owner? You know, what kind of lifestyle do you want? You know what kind of industries and potentials would excite you, and then ultimately, why? What are your options in the franchise industry that can meet your personal goals and objectives up until that point? You know, this is a few years back. Now, I wasn’t even aware of Sport Clips, maybe vaguely, but not enough to you know, have that one just jump to the top. But through this decision process that the consultant took, took me and my wife through we kept coming back that Sport Clips thing seems pretty interesting, so that’s why got us connected to it. But it was on behalf of and working with this franchise consultant that helped me go through that decision process to kind of narrow it down, ultimately becoming Sport Clips.
Speaker 1 03:37
What were some of the key points, if you could go back that far that puts sport clips at the forefront of the brands that you were looking at,
Speaker 2 03:45
probably a couple of bigger things, but many things go into that. It’s a thoughtful process. It needs to be thoughtful. There’s too much at stake for both parties. But the first thing that jumped out to us, one of the first things, was just how the Sport Clips folks treated us. And I know that may sound kind of simple, simplistic, but you know, I wanted to work we wanted to work with people that were, you know, we could mutually respect each other. We could be open and honest, and so the cultural fed between ourselves and what we learned from the Sport Clips folks as franchisors, was a really good match. The second thing is just, you know, and this is a big part of any decision, whether you somebody decides four clips, is it or not? Is what lifestyle do you want? I mean, we look at, I’ll just give one example to contrast it. You know, if you want to go in the food industry with nothing wrong with doing it, but that that’s a lifestyle, a serious lifestyle commitment. You know, you’re working a lot of long hours, and I’m not afraid of hard work at all. But I wasn’t, didn’t really want to be tied down to going into the same doing the same thing over and over and over again. I had that in the corporate world, so I was kind of tired of that sport clips, because it’s not owner operated directly, or 100% you have a lot of flexibility from a personal point of view, but also professional point of view. So between the two of those that was, that was the really big ones for us. It was just that cultural match and then the lifestyle match.
Speaker 1 05:15
So the really interesting thing about sport clips is that they bet their candidates, just as their candidates are vetting them as part of the discovery process. Do you think that this helps the entire support clubs organization be successful?
Speaker 2 05:28
Oh, yeah, 100% and that two way vetting is extremely important because this, you know, you get down, and I’m not talking legal, legally, but you want this to be a serious, long term commitment for both parties be halves. You don’t want to get into this and either side. And two years later, oh, well, we made a mistake here. That’s not good for anyone. It’s not good for the team leader. It’s not good for sport clips as a franchise war. So having a good, solid betting process is very, very important, and it’s a two way vote.
Speaker 1 06:00
So you mentioned earlier that you were looking for a business that would allow you some work life balance and flexibility, and the fact that the sport close business model is manager based, allows you to delegate the day to day operations while you get to focus on all the higher level activities. Do you find that as a team leader, you’re able to focus on the business rather than be in the business?
Speaker 2 06:22
Yes, that’s correct. Like foods, the food, food service industry, if you love food, that’s great. But you know, if you, if you don’t copy yourself being in, you know, the restaurant, 12 hours a day, seven days a week, that’s probably not a good match. We’re not, we’re not absentee owner at all. You know, we’re not just an investment model, but it’s still, you know, other I mean, stuff happens operationally, you got to dig in and deal with it. And you know, that’s always going to be the case, but that’s not seven days a week, 12 hour days.
Speaker 1 06:49
So describe the role of a team leader with sport clubs.
Speaker 2 06:54
Well, the first thing, and I’d be curious what your experience is with other team leaders. My wife and I run this we both run our sport clips. And the way we split the work up broadly is she handles operations, hiring, staffing, you know, stuff that comes up in the day to day, and I handled everything else. So everything else tends to be marketing, new store, development, the finance and accounting aspects of it, community outreach, things like that. So I’m outward facing more than she is, but she, you know, as an just as an example, just by chance, today, she’s helping train a couple of new team members that are coming on board. So I’m not doing the training. She is support her doing the training. Because, you know, good training is critical, but, you know, I’m I don’t have to get involved in things like that, but we work that out very early on. You know, if you happen as any of your listeners, are you considering it? You know, husband and wife duo approach, so you got to get that straightened out pretty quickly. Yeah, otherwise, you’re gonna end up stepping on yourself, and you’re around each other pretty much 24 hours a day, seven days a week. So yeah, you need to get that correct. Not that we’re perfect at all, and we still collide with each other, but you know, we know. We know how to separate the dues we have separated the duties.
Speaker 1 08:14
So expand on that a little bit. Tell us what the secret is to being successful in business with your spouse?
Speaker 2 08:23
Well, just like we went through the separation of duties and the acknowledgement of that, and you know, each of each of us are generally aware of whatever the other one’s working on, but and we do consult with ourselves, you know, it’s not that we keep it, you know, a hard wall there between our roles, like, you know, if we’re dealing with a personnel issue. It’s good, always good to have a second set of eyes that understand enough about the business that you can bounce things off of, just as you know, sanity check, if nothing else, but it’s done just for that. It’s not to say, Okay, I want, I need you to make this decision. It’s asking for input more than anything. You know, the one thing that we’ve learned because sport clips for us, at least, we’re open seven days a week, and operational issues can come up seven days a week. In fact, this seems just that, anecdotally, that tends to always happen on Friday, Saturday and Sunday. So, you know, the concept of a full day off is stuff that we’ve learned to bake into our existence. We just okay, you know, it’s Friday afternoon. We’re going to blow off early. We’re going to go, you know, watch the sunset at the beach because we’re in Florida, but because we can, you know, or whatever it is that you know, gets us away from the business, because we do accept the fact that we’re around it seven days a week, 24 hours a day, with each other. So we have to consciously make those decisions, not to let that overcome and to keep that balance, as you’re suggesting, it’s just something you have to work with, work in, into, and be aware of. So I think between those things and, you know, just, you know, from a separation of duties thing, you know, we, we kind of, you may have heard this before with others, in a husband, wife team, but we separated duties based on our strengths. You know, I do what I’m good at doing. She does what she’s good at doing, and that’s always a good thing. Nothing we don’t learn, you know, grow in what we do. You get better. You know, it’s always good when you can, you know, focus on something that you really are good at or better at, and you enjoy doing. So I think those are the cornerstones.
Speaker 1 10:20
So how has your experience in corporate America helped you find success in your sport clips franchises?
Speaker 2 10:29
Well, I think, I think the large company gigs I’ve had, like Disney, you know, the training, the very, very high end world class training, you get it, and that’s one of the benefits of the large company. They can afford. Company. They can afford serious training. If you can take that training and scale it down to a smaller work environment. Is very important, you know. And the scaling down as an example would be, you know, the budgets I would manage is say, let’s just use Disney’s example. I can’t even fathom the scale of that money now, given what we’re in Sport Clips. So my expectations of, you know, what you can actually accomplish with the resources that you have. It as a small business owner, I’ve had to learn to scale that back, but I didn’t lose things in doing that. It just, you know, I just wasn’t being unrealistic at what I could accomplish. You know, I just can’t, I can’t throw 10s of millions of dollars at a problem make it go away as a sportless team leader, just doesn’t make sense. But can I go and do good things like, you know, how do you lead employees? How do you, you know, have a world class operation in the smaller sense, those things scale down. If you choose to do it, if you want to do it. Some people, I expect, culturally, can’t do it. You know, you just give up. You know, I can’t give up all the nice perks and benefits I had as a corporate wife. But frankly, I was other than the emotional transition. I was ready to give those things up. I wanted something different. The other flip side of it too. We didn’t go all the way back, but, you know, I came from a family of small business owners and entrepreneurs. That’s what I grew up around, really small business kind of thing. So I was rooted in that. Then I left that to go to the corporate world. So now I’ve gone 360 degrees going back to that. So that’s kind of like a comfortable pair of old shoes you’re putting back on again. So not that didn’t come with transition issues, but you know, it’s good to be back.
Speaker 1 12:28
That’s awesome. So you had a really great upbringing in business, and you were able to find success in the corporate world, and now you’re back, building a world class organization on your own terms as a franchise owner, walk me through the process of how your business has grown over the years from the day you first started with Sport Clips till now.
Speaker 2 12:50
Yeah, that’s, that’s a pretty interesting question. And, you know, in hindsight now, so we’re in our sixth year of operation, six, six plus years. So back then, you know, you kind of being new to it. You didn’t know what you didn’t know, I mean, and it’s not saying Sport Clips doesn’t give great training they do, and great support they do. That’s a big part of, you know, the benefit of working with a really solid franchise or like that. But you still don’t know, you know, because things like what works in my market. Our market here may not be the same as what works in Austin, Texas. In fact, it probably isn’t the same. So you have to really get in there. So our first couple of years were, yeah, we signed the contracts. We’re paying our fees. We got employees, you know, where the customers coming from? You know? Then it dawned on me, well, I gotta get up. We gotta get out there and beat the streets here a little bit, you know, start, you know, bringing them in, you’re leaving them in. And it’s not that the brand doesn’t bring them in, because it does. But, you know, if you want faster growth, you got to get out there work for it. So that’s kind of our second generation, and that we saw a solid growth come off that. And then the next generation was covid. We’re not going to go into that. That was a that was nasty. But if what was the learning going through covid? What? And I learned this A Lesson A long time ago, but it’s never had a chance to apply. Talk about world class learning that you bring from the large company down to the small is like I was working with the guy, the chairman of the company, not personally. I mean, he’s a team, and he made a statement, the best time to grow is when the world thinks you can’t when something’s gone wrong, that’s when you want to hit the gas hard, and when covid hit. I remember these that philosophy very clearly. And I said, Okay, we’re going to go after this, you know. And we started aggressively going after growth, even though, you know, covid, you know, hit every industry, most industries really hard, including ours. So it’s one of those for you. You go off and you really invest for growth. And then what we saw coming out of covid was the payoff. So very clearly, you know, we laid that growth Foundation. And fortunately, I feel very fortunate. We’ve, we’ve overcome the covid impact. We’re still safety conscious, and all those good things may be that way, forever more safety conscious. But, you know, I was taking every available Penny and imploring that back into marketing. I was trying all kinds of things. What’s going to work? What’s, you know, here’s my chance to experiment. And, you know, I have a lot, you know, at that point, a lot to lose. I mean, you don’t have a lot, but establish that foundation. So that’s the current generation we’re working off of now. And I’m kind of, I think I’m coming to the end of that, ready to go the next one. I don’t, I can say that for certain, you never know. I mean, there’s no crystal ball here, but I think that the covid impact, while it was devastating, it was nasty. Never want to go through that again. Was this wake up call? Like, okay, now’s your chance. You know, nobody expects you to grow. No one. You know, no one. So that’s that was that call. Now I’m going to grow and do everything I possibly could to figure out what that meant. So they always, never want to go through that again. But you know, it’s, it was interesting.
Speaker 1 16:13
I was lucky to attend the huddle two years ago in San Antonio, where the Sport Clips organization was really focused on how to get through covid, and everything they did to overcome covid and emerge victorious on the other side. And the reasons to franchise are obvious, but when something like that happens, the the advantages present themselves in profound ways, right?
Speaker 2 16:35
Well, and we found ourselves speaking, I’m speaking, in the large we. We found ourselves coming together more cohesively. Whether you’re a team leader in Northern California or southwest Florida, it really, really didn’t matter. Everybody was feeling the pain. Everybody was feeling the pain. You may have degrees of pain, but it’s still pain. So that brought us together with more common cause and sport cliffs to help, you know, can encourage this. They were very aggressive about communication. You know, they’ve always been good at communicating. This became very aggressive. You know, we’re going to get the whole system together on a very frequent and regular basis and help us all work through that, including themselves. I mean, they were impacted. It wasn’t just the team leaders. So it kind of changed us, I think, culturally, for the good, and without that broader support, man, talk about being on your own. Holy crap. You know, I was volunteering for all the task force is the relevant ones, you know? I’ll join that. And you get in there, you’re talking with all these people that have similar issues, and you’re dividing up the solution. I’ll go try this. You go try that. Will that work or not? You know? So it kind of kind of brought us together, painful as it was,
Speaker 1 17:48
and I was at the huddle this year in Nashville, and it really is apparent just how unified the entire sport clips organization is, and that was really profound to see. It’s something that I think a lot of franchise systems would be envious of. But switching gears a little bit, you’re in growth mode. Tell us a little bit about what you’re doing to continue to grow your businesses.
Speaker 2 18:10
Well, you know, when you define growth in our industry so others as well, not just the hair business, but you grow your store revenue. That’s a primary growth channel. Are you expand? And you know, I’m doing both, and I’ve not, you know, the short growth that we’re breaking, fortunately, you know, we’re breaking records, sales records right now. But I’m not satisfied, you know? And it’s not that I’m greedy. I just, I’m I don’t know what this is. I know there’s a cap somewhere out there, if nothing else is capping the number of chairs. And if you can’t hire any more people, you’re probably Eastern Max. I’m not there yet, so, yeah, I’m gonna have that problem one of these days. And then the second one is just store growth. And you know, I’m literally now, I’m looking at two new store opportunities. I’ve got lease negotiations occurring, and that’s been more a function of just quality real estate. And, you know, I could have, you could expand at any point, technically, but, you know, we’ve been wanting we wait until the quality real estate presents itself, and then we move quickly on it. And that’s what we’re doing. That’s working too. That’s kind of an insane strategy. We did that the first time, but that’s, that’s, that’s kind of insanity. We’re doing it. We’re doing the same thing over again. So it will be insanity. But hey, two good ones presented themselves, not moving on them.
Speaker 1 19:34
So, so how big do you want your store count to get to? Do you have a goal in mind there?
Speaker 2 19:40
You know, there’s an operational point where the model, the team leader, model, changes. You know, with growth, you know, you start to put layers on top of that. And to be honest with you, it’s just, I’m not, I’m not sure I want to get into that mode, especially if I haven’t optimized the stores, because in optimizing the stores, an individual store or stores, you’re amortizing fixed cost over, you know, over a larger base of revenue. And it didn’t take an accountant to figure out what happens that extra cash when you do that. But so you can work under the a very similar structure than what you’re under now, you know, but if you increase your revenue by 30% you’re still working under the same structure. You may have another stylist or two you’ve hired, but you don’t have another layer of management. You don’t need it. So until I start to see what you can optimize at the store level, I’m not going to sign up for another dozen or so. I mean, I could do that, but I’m trying to, you know, milk, milk, the existing ones, and then when I get that, you know, point of saturation, okay, maybe I’ll bring in another couple locations after that.
Speaker 1 20:50
So talk to us a little bit about why the Sport Clips model is so scalable.
Speaker 2 20:55
Well, it’s scalable because with some rare exceptions, and I probably could, don’t know all the rare exceptions, but none of the team leaders cut hair. So what are you going to do? Well, you know, unless you want to sit back and do nothing, most of us don’t. We’re more ambitious than that. Well, you know, you grow your business, and because we’re not saddled to a single store. You can with good talent to help. You can expand your management leverage pretty easily. You know, how many can you do without a different, different level of management in there? You have to figure that out. I mean, that’s a function of how good of a leader you really are. But you can’t do that. It’s doing very doable. Team leaders do it all the time. Team leaders live with it all the time. So, you know, if you were stuck in the store, like you’re suggesting the restaurant, you near impossible, you’d have to be bringing someone over you to get give that individual or organization leverage that they could then take and expand out, you know, sell to, you know, a DC outfit or something like that, let them grow a layer over you, but as a team leader, I don’t want to do that. I wouldn’t want to do that. I want to, I want to be the real owner here.
Speaker 1 22:17
So what kind of qualities do you think you need to have to become a top performer at Sport Clips. You know,
Speaker 2 22:24
we can have the debate if this is what’s driving it, but what drives me, and I speak for my wife too, because we we’ve had these conversations since day one is number one by far, obsession over client satisfaction, raw obsession. And maybe that’s my Disney coming through. That’s where I learned it. That’s where I saw true world class guest obsession in the daily so being obsessed over happy customers. And I don’t say everybody’s going to be happy, but you know, everybody that has a bad situation, you deal with every client, every client that has a bad, whatever reason, bad working relationship with you or your store. You deal with it, you know, and try to turn it around and learn from those experiences and and, and, you know, because nobody likes to get negative feedback, it hurts. But take those as learning opportunities and turn it around. If you can turn around 80, 90% of those, you’re growing your business. How guaranteed that will happen. And guess what happens? The people that are happy are seeing you do that. You know, they’re happy, but they see you step up and, you know, act professionally when something happens. And if we lose this because we’re consumer driven. I mean, we’re about as consumer driven as businesses you could hope for. You know, we don’t have a variety of menu items that if, well, if I don’t like the hamburgers, I can have the steak. No, no, you’re getting haircuts. If you don’t like our haircuts, we lose you. You go somewhere else. There’s an easy points of transition away from your business like because it’s easy to come to your business. So it goes both ways. The flip side of that is all the new clients in this world of digital exposure, all those potential new clients are seeing you act like that in public. Genuinely act like that in public. And if I had to put a finger on one thing, just the top thing, it would be that managing our relationship, manage your reputation of the market, dealing with client satisfaction, dealing with issues. You know, I don’t know. I can say that we’re world class. I don’t know who to measure, measure us against, but you know, we strive to be the best on that. Second thing is just, you know, what’s critical for your daily you may even think this is, you know, I actually know it is a growth thing is taking care of your staff, you know, treat them like family. I know that’s overused. I get that, and I just don’t know of a better way to describe it. But, you know, really, really caring about them and helping them grow in their career. Feel excited about that you do, feeling excited about the brand. Because once you’ve done that, and I can suggest, you can go into two stores, one where the team leader cares, or any business that cares about their employees, versus don’t, you’ll know. As a consumer, you will know something’s going on. You won’t know why. You know if there’s no energy, there’s no excitement, there’s no electricity in the store. Likewise, if there is the client comes out of there thinking, wow, that was a great experience, but that’s coming from the people that really control the destiny of the business. That’s the the stylist in their day to day interaction with the clients. So, so those two things, you know, if I had, you know, rank two, that would be it, you know, when I think, yeah, the, you know, I mean, it’s not, I don’t about the financials. That’s why we do this. Is because of financial I don’t run this business because of an investment transaction. Mean, I can invest on Wall Street, you know, and live with the ups and downs there. But I wanted something that we can grow and make our own, you know, mold into what our own. And those are the two philosophies, though, the third philosophy is, it’s kind of related to the first two. Is professionalism, all of us. You know, if I’m out in public wearing the Sport Clips logo, if the stylist is out in public, wearing a Sports Clips logo, if you’re in the store dealing with the tough situation, you’re always professional. Always there is no excuse. That’s you have no excuse to not be professional at all moments when you’re representing the brand. You know, I know that may sound obvious, and to me, before I got into this, this business, it was kind of obvious, but it wasn’t turned out I was wrong. Turned out I was wrong. So anyway, I really care. Thanks for asking that question.
Speaker 1 26:38
Yeah, that’s a powerful answer. And speaking to so many Sport Clips team leaders, it seems to me that the most successful ones are the ones that really do care about their stylists. Because if you, if you show support to your stylist, then then the customer experience is going to be elevated at the end of the day.
Speaker 2 26:56
Yep, yeah. Because if the stylist are having a bad day, whether you caused a bad day or not. Clients, guys will know, and guess what, they’ll tell you. So then we weigh in, like, what happened here? You know, if somebody said, Well, if Solis was having enough that we’re taking on a personal app, you know, we’re, you know, respectful of that. But you know, guys recognize. They may not know what’s behind it. They know and we’re so we are very aggressive on getting client feedback. They’ll tell us.
Speaker 1 27:29
So our listeners are entrepreneurs looking for business opportunities. Why would you recommend Sport Clips as the one to invest in?
Speaker 2 27:38
Well, you know, we talked a little bit about the decision process up front, when I still think that that’s kind of first and foremost. Because I don’t want to presuppose that the lifestyle that I’ve chosen with Sport Clips would be, would be appropriate for someone else. I just don’t know. But if you go through that process and you get into that same rough space that I was in, you know, I don’t want to be in the business day in and day out, some of those pre key factors. I said, Yeah, sign up. Sign up for Sport Clips. Ask your hard questions. Go through the vetting process with them, you know, because what I appreciated you may not, you know, because if you flip that question the other way and ask it, have I ever considered leaving the model? The answer is no. The answer is, no, not that it’s been perfect. It never will be. I don’t have any expectations that it will be perfect. But even on the worst days, I know, you know, there’s somebody in Austin, Georgetown, Texas, that I can get on the phone with and talk to about what’s going on. May not get it, you know, fully to my satisfaction, but somebody’s going to the other listening.
Speaker 1 28:39
And just to wrap up here, it seems that all in all, your experience with Sport Clips has been enormously positive. You’re growing. You’re looking at two new locations right now. It seems that the future is really bright for you with this brand.
Speaker 2 28:53
Yeah, I think a lot of it just comes with knowledge and seasoning. Like I said earlier in our first phase, we literally didn’t know what we didn’t know. I mean, we were ignorant of franchising, and we’re new to small business. You just run down the list of things that you know. But because we’re we signed up with a franchise model Sport Clips. In our case, we had that infrastructure behind us. Because if you consider
Speaker 3 29:19
doing it on your own, unless you have industry experience,
Speaker 2 29:24
probably not a great move. And I’m not going to go and create a movie network or theme parks. You know, that’s where my industry or technology for that matter, you know, I just didn’t want to do that. So even though air industry is a long ways away from my background, we’re able to because of the sport and the infrastructure and the training that Sport Clips gives us, you know, get up that learning curve, but it’s learning curve. You have to accept it. And you make some mistakes, you have to accept that. It’s okay to do that, but so, yeah, you know, all those factors kind of marry up. I have no qualms about sport clips, assuming someone goes through a good, thoughtful decision process, that’s the bigger risk to me. You know, they shouldn’t be, for example, they shouldn’t be starting a small business at all period, you know, because not suit won’t suit them well. But if they go through that betting and then they come out and Sport Clips is one of their final options, Yeah, seriously, consider it.
Speaker 1 30:21
Well, Nick, thanks so much for taking the time to come on the podcast. I really enjoyed this conversation.
30:27
Yeah, thanks thanks for having me.
Speaker 1 30:32
Thank you for listening to the Sport Clips franchise development podcast. For more information about the Sport Clips franchise opportunity, please visit www dot Sport Clips franchise.com, you.
