Small Business Stories - ServiceMaster Clean Video

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Small Business Stories - ServiceMaster Clean

Alex Fees: With me now is Mike Isakson. He is the current Chairman of the board for IFA. Now Mike, before we go to that business, let’s talk about your personal business. What are you doing? Mike Isakson: Great! I'm the President and Chief Operating Officer, ServiceMaster Clean. That includes our Franchise businesses of ServiceMaster Clean, Furniture Medic in a mere respect. We’ve got about 5000 franchises worldwide in fact, ServiceMaster is one of the founding members of the IFA. Alex Fees: Really? Mike Isakson: We sold our first franchise, I didn’t, but we sold our first Franchise in the 1953. Today we’ve got, as I mention about 5000 Franchises and do about $1.7 billion at the consumer level so we’ve been a part of the International Franchisors Association for a long time. Alex Fees: Tell me about the road to becoming IFA Chair. Mike Isakson: Well I think it’s the road is involvement and we are involved in IFA because of the Education because of the—our primary goal is to enhance and protect franchising and so we’re able to learn more about franchising and also ServiceMaster looks at how the International Franchise Association can help us on public affairs issues on our public policy issues, primarily with the federal government or state governments. So the IFA is an important part of ServiceMaster providing that lobbying effort, helping us make sure that there isn't legislation that would be adverse to the relationship that we have on our franchise owners. Alex Fees: It sounds like ServiceMaster is very closely involved with IFAs ServiceMaster in a sort of a case study of the franchising? Mike Isakson: In IFA? Alex Fees: Right. Mike Isakson: Well yeah to a great extent but I think we’ve been franchising for a long time and this is a place where we can bring our experience plus also gain experience and as you say a case study that we learn from other franchise companies. We can bring our executives to these conferences and they can visit with peers and other industries and pick up ideas and thoughts about what’s working and what’s not working. So it really does to your point become a case study. Alex Fees: Mike, IFA, you have a business study you want to talk about. Mike Isakson: Right! The IFA about 8 or 9 years ago, commissioned to study with Price Cooper’s Water House to look at the economic impact of franchising. So what we did is we put together a study that we looked at the impact from franchising all the industries of franchising in each congressional district and in each state so we can look at the economic output, we can look at the number of jobs created and the number of locations and the number of franchise facilities and that’s all franchise operations regardless of the industry that they're in. Well we just completed our second economic impact study so there’s approximately five years between the first report and the second report. And in that report this time, gave us the chance because we have a benchmark when we did it the first time and we’re able to see the change and see the growth that’s happened in the franchising and as a result. And a couple of things that has really been fabulous is when you look at the report right now, the total economic output of franchising in a five-year period grew almost 41%. Alex Fees: Wow! 41% in five years? Mike Isakson: In five years. And if you look at all other sectors, that growth was 26% so franchising almost going twice the rate of total economic output which is phenomenal, meaning that the franchise opportunity provides real growth and it’s demonstrated in that kind of growth, 41% for all of franchising economic output as compared to the 26% for all other industries. Alex Fees: What 5 year period are you talking about for that study? Is that relevant? Mike Isakson: Yeah! It’s a five year period is 201 through 205. So again, when you do these studies, we’re using census data and so we’re looking back on information that’s collected. Alex Fees: How do you count for that growth? Mike Isakson: Well I think it’s—it basically—the franchise model provide sources and goods and it’s a very efficient form of distributions to those goods and services can be distributed pout into the field, out into the marketplace. Also franchising adapts really quickly, when there’s new needs that a consumer has, an entrepreneur comes up with an idea, meets the consumer’s needs and then looks at franchising as a way to distribute that need or to meet that need to the consumer and it’s a very efficient, effective way of distribution. Alex Fees: Mike, what about trends in franchising? Would those be trends in industry or trends in modeling of relationships or what? Mike Isakson: Well I think the trend is today that there are entrepreneurs that today are looking more and more to franchising to be able to put the hands of that owner closest to the customer. And when you’ve got owners through their employees that are touching and working for the customer and providing value proposition, you get great results, you get great customer satisfaction and I think that accounts for that growth. The other piece that’s interesting is if you look employment. Employment and franchising grew 12.6% in that same period as compared to the general economy grow 3.5. So when you look at the job creation in the franchise industry and you look at those kinds almost three times more growth in the franchising industry, then the rest of the economy, the consumer and—is rewarding franchise businesses as it go forward. Alex Fees: Mike with that data, explain why small and mid-size firms these days express optimism in the current market. Mike Isakson: Yeah absolutely. I think you hit on it exactly. I think also today in our economy, the sectors that are really being hit are housing, and that’s primarily driven by loan practices in the banking industry and so a lot of our activities are not related with the verbal housing industry and the financial institutions so I think you’re exactly right. Small business people are more in control and they’re more efficient and far more effective in the value of proposition of serving customers and that’s why they’re not affected as badly by the recession or we’re not in a recession but it’s badly by some economic downturns that are primarily again housing and financial at this point. Alex Fees: All right! Mike Isakson. Mike Isakson: Thank you very much. Alex Fees: Thank you very much. We appreciate you for being here. Mike Isakson: Great! Alex Fees: All right!

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Alex Fees: With me now is Mike Isakson. He is the current Chairman of the board for IFA. Now Mike, before we go to that business, let’s talk about your personal business. What are you doing?

Mike Isakson: Great! I'm the President and Chief Operating Officer, ServiceMaster Clean. That includes our Franchise businesses of ServiceMaster Clean, Furniture Medic in a mere respect. We’ve got about 5000 franchises worldwide in fact, ServiceMaster is one of the founding members of the IFA.

Alex Fees: Really?

Mike Isakson: We sold our first franchise, I didn’t, but we sold our first Franchise in the 1953. Today we’ve got, as I mention about 5000 Franchises and do about $1.7 billion at the consumer level so we’ve been a part of the International Franchisors Association for a long time.

Alex Fees: Tell me about the road to becoming IFA Chair.

Mike Isakson: Well I think it’s the road is involvement and we are involved in IFA because of the Education because of the—our primary goal is to enhance and protect franchising and so we’re able to learn more about franchising and also ServiceMaster looks at how the International Franchise Association can help us on public affairs issues on our public policy issues, primarily with the federal government or state governments. So the IFA is an important part of ServiceMaster providing that lobbying effort, helping us make sure that there isn't legislation that would be adverse to the relationship that we have on our franchise owners.

Alex Fees: It sounds like ServiceMaster is very closely involved with IFAs ServiceMaster in a sort of a case study of the franchising?

Mike Isakson: In IFA?

Alex Fees: Right.

Mike Isakson: Well yeah to a great extent but I think we’ve been franchising for a long time and this is a place where we can bring our experience plus also gain experience and as you say a case study that we learn from other franchise companies. We can bring our executives to these conferences and they can visit with peers and other industries and pick up ideas and thoughts about what’s working and what’s not working. So it really does to your point become a case study.

Alex Fees: Mike, IFA, you have a business study you want to talk about.

Mike Isakson: Right! The IFA about 8 or 9 years ago, commissioned to study with Price Cooper’s Water House to look at the economic impact of franchising. So what we did is we put together a study that we looked at the impact from franchising all the industries of franchising in each congressional district and in each state so we can look at the economic output, we can look at the number of jobs created and the number of locations and the number of franchise facilities and that’s all franchise operations regardless of the industry that they're in. Well we just completed our second economic impact study so there’s approximately five years between the first report and the second report. And in that report this time, gave us the chance because we have a benchmark when we did it the first time and we’re able to see the change and see the growth that’s happened in the franchising and as a result. And a couple of things that has really been fabulous is when you look at the report right now, the total economic output of franchising in a five-year period grew almost 41%.

Alex Fees: Wow! 41% in five years?

Mike Isakson: In five years. And if you look at all other sectors, that growth was 26% so franchising almost going twice the rate of total economic output which is phenomenal, meaning that the franchise opportunity provides real growth and it’s demonstrated in that kind of growth, 41% for all of franchising economic output as compared to the 26% for all other industries.

Alex Fees: What 5 year period are you talking about for that study? Is that relevant?

Mike Isakson: Yeah! It’s a five year period is 201 through 205. So again, when you do these studies, we’re using census data and so we’re looking back on information that’s collected.

Alex Fees: How do you count for that growth?

Mike Isakson: Well I think it’s—it basically—the franchise model provide sources and goods and it’s a very efficient form of distributions to those goods and services can be distributed pout into the field, out into the marketplace. Also franchising adapts really quickly, when there’s new needs that a consumer has, an entrepreneur comes up with an idea, meets the consumer’s needs and then looks at franchising as a way to distribute that need or to meet that need to the consumer and it’s a very efficient, effective way of distribution.

Alex Fees: Mike, what about trends in franchising? Would those be trends in industry or trends in modeling of relationships or what?

Mike Isakson: Well I think the trend is today that there are entrepreneurs that today are looking more and more to franchising to be able to put the hands of that owner closest to the customer. And when you’ve got owners through their employees that are touching and working for the customer and providing value proposition, you get great results, you get great customer satisfaction and I think that accounts for that growth. The other piece that’s interesting is if you look employment. Employment and franchising grew 12.6% in that same period as compared to the general economy grow 3.5. So when you look at the job creation in the franchise industry and you look at those kinds almost three times more growth in the franchising industry, then the rest of the economy, the consumer and—is rewarding franchise businesses as it go forward.

Alex Fees: Mike with that data, explain why small and mid-size firms these days express optimism in the current market.

Mike Isakson: Yeah absolutely. I think you hit on it exactly. I think also today in our economy, the sectors that are really being hit are housing, and that’s primarily driven by loan practices in the banking industry and so a lot of our activities are not related with the verbal housing industry and the financial institutions so I think you’re exactly right. Small business people are more in control and they’re more efficient and far more effective in the value of proposition of serving customers and that’s why they’re not affected as badly by the recession or we’re not in a recession but it’s badly by some economic downturns that are primarily again housing and financial at this point.

Alex Fees: All right! Mike Isakson.

Mike Isakson: Thank you very much.

Alex Fees: Thank you very much. We appreciate you for being here.

Mike Isakson: Great!

Alex Fees: All right!

Transcription by: Scribe4you Transcription Services