How the Most Successful Franchises Began
By Gina Petrone

"Leaders learn from the past, focus on the present, and prepare for the future."

True leaders provide the sky in which others can soar and no where is this more applicable than in franchising. The founders of the following franchise companies all took a relatively simple concept and molded it into the household names we know today. It wasn't always easy, as you'll learn, and the road to riches is paved with plenty of obstacles. But each franchisor profiled believed in their dream and persevered. "I learned that failing doesn't drain your self-confidence," said Bud Hadfield, founder of Kwik-Kopy Franchise Corp. "It's the fear of failing, and that's why so many people in life never really reach their potential.

Everyone loves a good, old-fashioned American success story and the following franchisors didn't give up on their dreams and reached their potential. Some are even now looking for new worlds to conquer.

If Started With a Backpack--Play It Again Sports

In 1983, Martha Morris wanted to hike the Appalachian trail in Connecticut. Being a novice, she bought new hiking supplies including a great $200 backpack. But hiking was more than she bargained for and she returned home after a few days.

Back in Minneapolis, funds were tight and it was difficult paying the rent. Morris sold her couch, sold other belongings and prepared to sell the backpack. She placed an advertisement in the local paper: "Barely used backpack--$100". No calls.

So she posted a photo of the backpack at the local sporting goods store. No calls. She brought it to a clothing consignment store. No deal. She looked for used sporting goods stores. Couldn't find any.

Then Morris had a bright idea. In addition to this almost-new backpack, probably thousands of other Minneapolis and St. Paul residents had used sporting goods at home, sitting in attics, basements, and closets. Many were in fine shape and would appeal to a second generation. Neighbors could benefit. Some could sell, others could buy. Maybe she could open a used sporting goods store and start recycling.

Martha Morris did just that. She borrowed $7,000 from a family member and found a landlord who gave a few months' free rent. She then placed an ad in the local newspaper and found a television reporter to air a great story. The young owner learned as she went along. Morris had little idea of pricing, so she asked her customers for advice.

As the years progressed, business kept increasing. Kids kept growing and needed larger sizes. Adults found a way to sell their unused equipment and also buy equipment for themselves. Seasonality also spurred business. Winter brought demand for skiing, skating and hockey equipment while summer was baseball, golf, swimming, and in-line skates. Year-round was fitness and exercise equipment.

Everything went so well that others asked Morris about opening their own Play It Again Sports stores. She called a franchise consulting business for advice and they helped her manage her business, refine her concept, and sell territories to other owners. After four years, her own business thrived and she and 20 other stores in the Midwest.

Eventually, Morris sold Play It Again Sports to the owners of that franchise consulting business, Grow Biz International. This company franchised it worldwide and today has about 700 stores. Martha Morris remains very involved in the company she founded and speaks on entrepreneurship and the spirit of business.

Uh, Oh…Better Get MAACO

When the International Franchise Association named Anthony Martino of MAACO Enterprises the 1990 Entrepreneur of the Year, he was singled out as "the only franchisor to accomplish the 'hat trick' of franchisee--three successful franchise chains: Aamco, MAACO and Sparks Tune-Up. Martino later established a fourth successful franchise, the Goddard School for Early Childhood Education.

Tony Martino had created Aamco Transmissions in the 1950s and made it the largest transmission franchise chain in the world. After selling his interest in Aamco in 1967, he perceived another major hole in the marketplace--restoring cars to their peak appearance. He saw a fragmented market with thousands of small, independent body shops, a small regional chain or two, a national company doing cheap jobs, and the custom shops for expensive vehicles.

Opening a pilot shop in Wilmington, Delaware in 1972, Martino personally developed the methods and procedures for the creation of a nationwide auto painting and collision repair chain--the franchising of which was predicted by "experts" to be impossible to accomplish.

In 1972, the first franchise center opened in Tucson, Arizona. Seven more were added in 1973, and the chain rose to 28 in 1974. Over the next two years, MAACO mushroomed to over 200 centers, purchased and operated by aggressive, independent men and women who believed in the MAACO concept as the way for them to succeed in business.

As the 90's near an end, MAACO has some 500 centers in 47 states and Canada. Recently, the chain's expansion has reached Mexico and Puerto Rico. Since it was founded, MAACO has repainted and repaired more than 10 million vehicles and sales in excess of $350 million.

In 1988, recognizing the growing dilemma of child care throughout the U.S., Martino formed a partnership with Joseph A. Scandone, president of Goddard Schools in Malvern, Pennsylvania. They founded Carousel Systems, Inc. and began franchising Goddard Schools for Early Childhood Education, offering quality childcare and developmental training for infants to kindergarten. By late 1997, there were 38 Goddard Schools with another 20 planned to open within the next two years.

Whatever franchise he founded, Tony Martino has combined strong leadership qualities with a high degree of business acumen which has enabled hundreds of men and women throughout the world to realize the dream of owning and operating their own business.

From Part-Time to an Industry Leader

Through a network of more than 6,000 franchise owners spanning 14 countries, Jani-King has become one of the world's largest and most successful commercial cleaning franchisors. And as is often the case in success stories, it all happened because one young entrepreneur saw gold where others saw hard work.

In 1968, Jim Cavanaugh was a student at the University of Oklahoma, looking for a way to earn extra money. He took a night job at a Holiday Inn in Norman. It wasn't long before the outgoing Cavanaugh had befriended a number of people at the hotel, including the janitor. The more time he spent visiting with the man, the more Cavanaugh began to realize that the janitorial business was one that would never go out of style. As long as there were office buildings, there would be customers. The man explained to Cavanaugh that it wasn't a business that would earn huge profits because janitors are not, by nature, sales people.

Cavanaugh, however, sensing another source of extra income, began marketing janitorial services during the day. At night, he and his friends would grab their buckets and clean buildings.

Less than a year later, Cavanaugh had turned his part-time job into a full-time career and established Jani-King. By 1974, Cavanaugh realized there was literally a world of business available to Jani-King. The only question was how to expand without losing quality and integrity? He found his answer in franchising.

But Cavanaugh wasn't interested in setting up the traditional franchise. He didn't want a system where franchisees' success was heavily dependent on their ability to find business. Cavanaugh recognized that finding business was one of his stronger assets and he decided that Jani-King would be different. Jani-King would find the business, setting up a customer base from day one.

In fact, Cavanaugh designed the Jani-King system so that franchisee could ease into business for themselves without leaving the security and income of their present jobs. Franchise fees were established on a sliding scale--the larger the initial customer base the potential franchisee wished to start out with, the larger the investment. It is a win-win situation in the truest sense. By the year 2000, annual system-wide sales revenues for Jani-King are projected to surpass $1 billion.

Paying for College

Another young entrepreneur founded a restaurant chain by trying to find extra income. In the summer of 1965, 17-year old high school graduate Fred DeLuca was working at a hardware store in Bridgeport, Connecticut trying to earn enough money to pay his college tuition. He was determined to find a way to supplement the minimum hourly wage he was earning. The solution came at a backyard barbecue during a conversation with his family friend, Dr. Peter Buck.

Dr. Buck, a nuclear physicist, suggested to young DeLuca that he open a submarine sandwich shop. Dr. Buck referred to a successful sandwich shop in his hometown where everyone, including himself, enjoyed the sandwiches.

With a $1,000 loan from Dr. Buck, a partnership was formed. Pete's Super Submarine opened on August 28, 1965 in a remote location in Bridgeport, not far from the hardware store. In the early days, the company's weekly meetings took place in the DeLuca family kitchen. It was there, over bowls of homemade pasta, that the partners focused on ways to increase sales and meet the challenges that they faced.

Upon opening their second location, a year later, the two men realized that marketing and visibility were going to be key factors to the success of their restaurants. To help increase visibility, they shortened the name from Pete's Subs to Subway and introduced the now familiar bright yellow logo. Their next step was to formulate a business plan that outlined the company goals. In an effort to reach these goals, Subway restaurants began franchising, giving others the opportunity to succeed in their own business venture. The first Subway franchise opened in Wallingford, Connecticut in 1974.

A decade later, the first international Subway restaurant opened on the island country of Bahrain, off the coast of Saudi Arabia. In August 1995, Subway celebrated 30 years in business and witnessed the opening of its 11,000th restaurant.

As for college, DeLuca did receive a Bachelors Degree in Psychology in 1971 and has become a successful businessman, to this day serving as president of one of the world's largest fast food chains.

A Special Hobby

Debra J. Fields started baking chocolate chip cookies for her family in Oakland, California when she was just 13-years old. Later she tried out new flavor combinations and tested them on her five daughters, her husband and his business colleagues. When she opened her first store in Palo Alto at age 20, she had no idea of the magnitude and impact her enterprise would ultimately create.

Prior to the 1970's, commercially made cookies were the province of large food manufacturers and distribution was primarily through grocery outlets. Due to the necessity of long shelf life, commercially available cookies were small, dry and crisp. Mrs. Fields created a significant new market niche. Customers responded favorably to fresh, out-of-the-oven cookies made with the highest quality, all-natural ingredients.

Buoyed by the success of the Palo Alto store, a few more stores were added in the late seventies, bringing the total number of stores to 15 by 1980. These, too, were successful, creating the opportunity for even greater growth.

Competitors began to emerge and the large, packaged cookie and biscuit manufacturers began to introduce "soft, chewy" cookies. The competition only boosted Mrs. Fields confidence, and the company set market leadership as its goal and began an aggressive expansion program. Currently, Mrs. Fields has nearly 600 retail stores operating in ten countries throughout the world. Mrs. Fields continues to grow with significant international expansion planned over the next five years.

Mrs. Fields famous cookies are sold while they are still warm, soft and chewy--recreating the experience of having a home-baked cookie right out of the oven. Mixing and baking at home is still a favorite family activity for Debbi Fields and her special hobby has grown into an international business.

His Brother Got the Car

Thomas S. Monaghan was born in 1937 in Ann Arbor, Michigan. His father died four years later, ushering in a childhood of foster homes and orphanages. After graduating from high school, Monaghan enlisted in the U.S. Marine Corps in 1956. Receiving an honorable discharge in 1959, Monaghan returned to Ann Arbor and enrolled at the University of Michigan.

While attending college, Monaghan and his brother, James, borrowed $500 and bought a small pizza store called DomiNick's in Ypsilanti, Michigan. In less than one year, James trades his half of the business to Tom for a Volkswagen Beetle. Tom formed another partnership, opening additional stores in Ann Arbor and Mt. Pleasant but by 1965, Tom became the sole owner of the company and renamed the business Domino's Pizza, Inc.

The company owes its success to a few simple precepts: a limited menu offered only through carryout or delivery; and a total satisfaction guarantee--any customer not completely satisfied with their Domino's Pizza experience is offered a replacement pizza or a refund.

For 32 years, Domino's Pizza maintained a limited menu of pizza and Coca-Cola. In 1992, the company introduced bread sticks. Different style crusts, flavored crusts, and buffalo wings soon followed.

Monaghan pioneered several innovations in the pizza industry that have set standards among other operators. Monaghan is credited with developing dough trays, the corrugated pizza box, insulated bags to transport pizzas, the pizza screen, a conveyor oven and a unique franchise system enabling managers and supervisors to become franchisees.

In 1996, Domino's sales reached $2.8 billion. After 37 years and 1,300 franchisees, Domino's Pizza operates more than 5,800 stores throughout the U.S. and in 59 international markets.

No Fear of Failure

According to Bud Hadfield, "Failure is a learning experience. We all have the talent to fail. Failure is not in losing but in giving up the idea that winning is no longer worthwhile." And Hadfield has known both sides. A high school dropout, Hadfield was labeled "rebellious" by administrators at Cranston (Rhode Island) High. By age 24, he had roughhoused his way through the Merchant Marine and gone through a myriad of business projects including selling eggs, pig farming, and operating an ice cream parlor, gas station, frozen food business, fireworks stand, and a personnel agency.

But in 1948, Hadfield found a job in his favorite field--commercial printing--and within weeks, met a widow who wanted to sell her small print shop for $1,000. Hadfield and his brother each scraped up $250 and financed the rest. Throughout the early fifties, the Hadfield brothers' letterpress shop struggled to survive. By the late fifties, Hadfield had bought out his brother and the company had achieved modest success.

But Hadfield's drive and energy continued to spill over into angry tantrums and fistfights that kept employee turnover high and lost customers. Finally, one of Hadfield's friends talked him into taking the Dale Carnegie course. It turned his disposition around and helped ensure his success. The energy once spent pounding people out was converted to charming them.

In 1966, Hadfield attended the demonstration of a new camera that transferred a photographed image onto an inexpensive printing plate. Hadfield recognized the possibilities it presented for short-run, low cost, overnight printing and bought one on the spot. He founded the company that became Kwik Kopy in 1967 and decided, at virtually the same time, to franchise the concept.

In 1992, Hadfield formed the International Center for Entrepreneurial Development, which serves as an alliance for Kwik Kopy and Hadfield's other franchised ventures including American Wholesale Thermographers, Inc., The Ink Well of America, Copy Club, and Women's Health Boutique. The "rebellious" high school dropout now oversees a printing empire with more than 1,000 shops that stretches around the globe.

A Simple Handshake Between Friends

At a time when Elvis was "King" and The Beatles were about to take America by storm, two young men in Matawan, New Jersey began sharing fishing stories and practicing archery. As their friendship grew, neither imagined that each had a unique ability that, when joined together, would become the formula for building one of the most successful home service franchises in America.

The two friends were Bobby Magda and Tony Giordano. Bobby, who wanted to follow in his dad's footsteps and become a tool and die maker, was apprenticing with the Singer Sewing Machine Manufacturing Company. Tony, a natural salesperson, bought a small hardware store on Main Street. When construction began on a nearby housing development, Tony's store was filled with new homeowners--all with questions on how to build and care for their lawns. So many came to him for advice, that Tony decided to conduct special lawn care workshops every Sunday morning.

However, Tony became disheartened when, even after his workshops, he saw homeowners spending so much money caring for their lawns themselves and still not getting the results they expected. He called his friend, Bobby, and told him of his frustration. They met at Federici's Pizza to continue their discussion and, after a simple handshake, decided to start a lawn care business.

While Tony used his hardware store to market the business, Bobby quit his job and sequestered himself in his basement, creating a machine that would build and maintain lawns. This machine became the first patented, mechanically automated lawn care machine in the industry. In time, as their reputation grew, a local newspaper ad salesman started calling Tony "The Lawn Doctor". Little did he know that he would spark an idea in the two men. Their new company would be christened "Lawn Doctor" and its logo would be the now-famous green thumb.

Bobby's basement was converted into "the factory" where the next three machines would be built. Today, more than thirty years after the first machine emerged from Bobby's basement and 300 franchises, Lawn Doctor still begins all of their relationships with a handshake between friends.

Selling Nostalgia

A&W Rootbeer, the first restaurant chain in the country to franchise has had its share of ups and downs. The chain, which dispenses hot dogs and rootbeer floats to several American generations, was a neglected business. But thanks to a savvy group of fast-food industry executives who understood the value of a name and the global lure of Americana, people are getting a new taste of a venerable but once-troubled American brand.

A&W was founded in 1919 when Roy Allen opened his first rootbeer stand in Lodi, California. Allen went into partnership with Frank Wright and the name A&W was formed. The entrepreneurs perfected the rootbeer recipe still used today. To many, the orange and brown logo evokes memories of flashing headlights for waitress service and eating in the car from clip-on trays laden with coney dogs, Papa burgers and heavy mugs of cold rootbeer.

In 1956, A&W opened its first international unit in Winnipeg, Canada and in 1962, the first unit opened overseas in Guam. In 1982, A. Alfred Taubman purchased A&W Restaurants. Now numbering about 1,000 storesin 46 states, A&W had 2,400 at its heyday.

Cadbury Beverages of North America has owned the A&W trademark since 1993 but the chain has rights in perpetuity to sell draft root beer in restaurants. In 1994, Sid Feltenstein led a group of investors and purchased A&W Restaurants for about $20 million. Under Feltenstein's direction in his first year as chairman, president and CEO, A&W in 1995 recorded its first positive net growth in more than 20 years. The company has also unveiled a new logo and prototype as part of Feltenstein's Vision 2000 business objective which involves improving operations, enhancing the chain's image, accelerating development and marketing more aggressively, especially at the local level.

The company also hopes to double its current tally of international sites to 300 by the year 2000. A&W currently operates in 13 countries in Latin America, Asia and the Middle East.

Personal Experience

In the early 1970s, the residential real estate business was primarily company-dominated. Most real estate offices were on the commission-split system. In exchange for an office environment and whatever services the company provided, sales agents gave up to half of their commissions to the broker. The broker determined and controlled the office advertising budget, thus limiting any individual agent's advertising options. The few high producers in any single office were penalized for their production because they were the ones who contributed the most to the office overhead, thus supporting the beginning, part-time, and low-producing agents.

Dave Liniger knew that frustration because he was one of those agents. He liked real estate but not the way much of it was done. So in 1973, he decided to start his own real estate operation along with Gail Liniger. As they saw it from the beginning, the sales associate was the major piece in the real estate puzzle. The major challenge was to attract and retain top people who would, in turn, attract other top people, creating a highly professional environment. They couldn't keep those top producers, though, by taking half of their commissions and couldn't cover the overhead without splitting the commissions.

A partnership structure called the "100 percent" program offered a solution. In exchange for sharing monthly office overhead and management fees, a real estate agent could keep the highest possible percentage of commissions earned. That commission can be 100 percent in some areas, while in other areas, business regulations set the highest possible commission at 95 percent. Under such a program, the degree of success a sales associate can achieve is limited only by ability, determination and hard work--not by the restrictions one finds in conventional real estate companies.

The Linigers combined the best of the 100 percent and traditional systems to recruit and retain the best in the business. They targeted the top 20 percent of full-time sales associates who could account for roughly 80 percent of the transactions. They called their concept RE/MAX, an acronym for "real estate maximums".

Company growth was slow, but the Linigers were persistent. By the end of the second year, they had 42 associates. In 1977, they sold their first regional master franchise and their first Canadian franchise. The following year they reached the 1,000 agent milestone. At the end of their first ten years, they had more than 3,000 agents in 400 offices across the United States and Canada. By the end of 1997, there were 49,000 associates in 3,000 offices around the world, including South Africa, Israel, Germany, Spain, Italy, Australia, Turkey, the United Kingdom, Singapore, and the Caribbean.

Sign of the Times

You could say that in 1985, at the age of 30, Gary Salomon saw the sign. While working as a print broker and catalog developer at an Austin bookstore, Salomon took the advice of one of his customers and began examining a new computerized sign shop. Salomon immediately saw an opportunity to fill a growing need--retail businesses needed signs that could be produced quickly.

Salomon was impressed by the speed and quality of the precision-cut vinyl signs produced by computer-assisted design systems at the Austin shop. He and Robert Schanbaum, the customer who had given Salomon the idea, struck a deal with the shop owner: training in exchange for an agreement not to open a shop in the Austin market.

After they had learned the business, Salomon and Schanbaum gathered some money and opened the first American FASTSIGNS shop in Dallas. The approach was a complete break from sign industry tradition. For the first time, custom signage was readily available in small quantities, at a convenient location, and at affordable prices. Businesses were able to use quality signs and graphics more effectively and consistently, rather than adjusting their marketing plan according to costs and turnaround times.

Salomon, whose forte is marketing, directed outside sales, telemarketing, advertising, and trade show coordination while Shanbaum handled the operational and retail side of the organization. They agreed that if the store reached sales of $15,000 a month after the first year of operation, they would open a second store.

"We hit that level within four month," Salomon said. "After 10 months, we hit $25,000 a month. We knew we had a tiger by the tail."

After opening two more stores, the pair thought growth was too slow and that competition was inevitable as the technology became cheaper and more readily available. To speed growth and stay ahead of that competition, they began franchising their system in December 1986.

FASTSIGNS now has over 390 stores worldwide, with a National Accounts program that provides expanded service to larger corporate clients in North America. Salomon has taken his knowledge of the market and turned it into a highly targeted, cost-effective advertising approach to reach his audience. "One of the reasons our stores have done so well is the way we can get the most bang for our buck," he said.

Seeking Refuge

Dave Thomas never had a sense of belonging. Adopted when he was six weeks old, Thomas moved from state to state as his adoptive father looked for work. Always the new kid on the block, Thomas sought refuge in work. He started working at age 12, delivering groceries in Knoxville, but was fired after a misunderstanding with his boss about his vacation. His second job was as a soda jerk at Walgreen's, but he was fired again when his boss found out Thomas wasn't 16.

By the time Thomas was 15, he had moved again and was working full-time at the Hobby House Restaurant in Ft. Wayne. Shortly thereafter, he made the biggest mistake of his life--he dropped out of high school to work full-time. He thought he could learn more about the restaurant business with a hands-on education than he could learn in school.

After a stint in the Army, Thomas returned to the Hobby House. In 1956, Thomas and his boss, Phil Clauss, opened a barbeque called The Ranch House. Later, Clauss bought a KFC franchise and Thomas was in the chicken business. In 1962, Clauss offered Thomas a chance to turn around four failing KFC carryouts Clauss owned in Columbus, Ohio. If Thomas could turn the carryouts around and pay off a big debt, Clauss would give him 45 percent of the business.

Although daunting, this was the kind of challenge Thomas liked. He cut the 100-item menu, focusing on chicken and side items. Thomas added the famous bucket of chicken logo and implemented some effective marketing campaigns that included trading buckets of chicken for radio air time. The restaurants began to prosper and he added four more restaurants. In 1968, his boss sold the restaurants back to KFC for $1.5 million, making Thomas a millionaire at age 35.

Drawn to hamburgers, Dave opened the first Wendy's Old Fashioned Hamburgers restaurant in November 1969 in Columbus. He named the restaurant after his eight-year-old daughter, Melinda Lou, nicknamed "Wendy" by her older brother and sisters.

The first Wendy's menu included fresh, made-to-order hamburgers, chili, French fries, soft drinks, and a Frosty Dairy Dessert. The decor was homey, with bentwood chairs and Tiffany-style lamps. Thomas planned to open several restaurants around Columbus, giving his children a place to work during the summers.

Competitors scoffed at this young entrepreneur, but Wendy's grew and prospered. In 1973, Thomas began franchising the Wendy's concept, pioneering the idea of selling franchises for entire cities and parts of states, rather than single units. Wendy's grew rapidly, with more than 1,000 restaurants opening in the first 100 months. That rapid growth continues--Wendy's and its franchisees now operate more than 4,800 restaurants in the U.S. and 34 countries.

If You Can't Beat 'Em, Join 'Em

Stuart Bainum became involved with what later became Choice Hotels International in 1958. He already owned several hotels but he wanted to get involved in the Quality Inn system. He bought a Quality brand hotel and ultimately became primary shareholder of the company and decided to make it a true franchise organization.

Initially, there were seven Quality Court hotels in 1939. The group of hotels began as a membership organization on a referral system between the hotels, similar to Best Western today. There were five in Florida, one in South Carolina, and one in Virginia. They were joined together only by their referrals.

In 1981, Bainum recruited a team of executives including Gary Petit to head up Quality Inns International. Quality became the first company to segment and offer two flags under one chain. By 1996, the 339 roadside motels mushroomed to over 3000 hotels/motels, inns and resorts in 33 countries under the brand names Comfort, Quality, Clarion, Sleep Inn, Rodeway Inn, Econo Lodge, and MainStay Suites.

From Adversity Sprouts Success

A graduate of Hofstra University, Don Dwyer had already begun the path to financial independence, having successfully built a newspaper distributorship to pay his way through college. He later sold the business to buy a franchise territory with SMI (Success Motivation Institute). Dwyer's record sales earned him a position as senior vice president of SMI in Waco, Texas--a move that would introduce himto the city where he would one day start a franchising empire of his own.

Dwyer left SMI to become a partner in the Guarantee Carpet Cleaning & Dye Co. However, with only a 49 percent stake in the business, Dwyer successfully grew the business and a power struggle ensued. In an agreement that is legendary in franchising, Dwyer was willing to give up his assets in the company in return for the right to ask 50 percent of the franchise owners to join him in a new company.

In 1981 that company became Rainbow International Carpet Cleaning and Restoration Specialists. "The best thing that ever happened to me was getting fired and losing my company," said Dwyer. "That's when I learned that from adversity there sprouts a greater seed of success."

Basing his operation in Waco, Dwyer managed and grew his network of carpet cleaning franchises throughout the country and abroad. Today, the Dwyer Group encompasses the following franchise systems: Worldwide Refinishing, Mr. Rooter, Aire Serv, Mr. Electric, Kitchen Wizards, Mr. Appliance, General Business Services, and E.K. Williams & Co. By the year 2001, The Dwyer Group projects supporting a total of 5,000 franchisees worldwide, generating in excess of $1 billion in retail sales.

Under the premise of what is still the Dwyer mission today, Dwyer's goal was: "To teach the principles and systems of personal and business success so that all people we touch live happier, more successful lives."

Don Dwyer, Sr. died in Dec. of 1994 at the age of 60 from a massive heart attack. In his absence, the company has continued to grow by following his original principles. Today, his family, whom he referred to as his #1 team, is actively involved in the business.

Filling a Need

Since its inception, the Mail Boxes Etc. (MBE) franchise structure has allowed many entrepreneurial individuals to pursue the proverbial American dream of owning their own business under the guidance and expertise of a strong corporate structure. Back in 1979, like most of MBE's present franchisees, Anthony DeSio was searching for his own dream business to run. A former aerospace executive, DeSio was employed at The Brokerage, a San Diego business brokerage firm and held various management positions with Linkabit Corporation, Western Union, General Electric Company, and Lockheed Aircraft Corporation.

DeSio soon became associated with a start-up business which was involved with providing consumers with a convenient place to conduct postal business without the usual hassle. When the first storefront center opened in La Costa, California, in 1980, the operation was so lean that it also housed the fledgling company's corporate office. At times, during those early years, it was a struggle to keep the young business on an even keel. Getting the company through that difficult period is generally credited to DeSio's thoughtful and conservative management approach--his ability to "solve problems without money", as one associate put it.

Operating within that strategy, the company continued to grow, adding services wherever a need appeared. In 1986, MBE went public and sold stock to finance expansions.

MBE is often referred to as an alternative to the U.S. Post Office because before MBE, waiting lists for renting boxes at the Post Office and long lines for buying stamps and mailing packages were commonplace. It was just a niche waiting to be filled. But until DeSio came along and recognized that need, postal customers continued to wait for service.

Early on, however, DeSio was quick to point out that MBE doesn't consider itself in competition with the Post Office, but rather a service convenience to the customer. And, he soon realized, mailbox rentals alone would not sustain the business. Almost immediately, DeSio envisioned adding other services to make the business more profitable. Consequently, mailbox rental accounts for only a fraction of MBE's business today.

Since its founding, MBE has grown in quantum leaps, doubling its size every few years. MBE hit the 1,000 franchise locations mark by 1990 and quickly expanded to twice that number by 1993.