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Episode 105: DoodyCalls | The $$ Multi-Million $$ Earnings World of Pet Waste Franchising

• Mike Halpern • Season 1 • Episode 105

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In this episode, Mike Halpern welcomes Chad Harrison, the Director of Franchise Development at DoodyCalls, to discuss the unique niche of pet waste management and the growth of the franchise under Authority Brands. Chad shares his journey from the restaurant industry to franchising, highlighting the challenges and rewards of transitioning to a business that many might overlook due to its humorous nature. He emphasizes the importance of customer demographics, revealing that the primary clientele consists of middle-class families and retirees who value the convenience of pet waste management services. 

Chad also addresses common misconceptions about the business, such as the belief that it caters only to affluent customers or is a seasonal service. He explains how DoodyCalls operates year-round, servicing both residential and commercial clients, including airports and dog-friendly establishments. The conversation delves into the operational efficiencies and technological advantages that set DoodyCalls apart from competitors, making it an attractive option for prospective franchise owners looking for a scalable and essential service in the pet care industry.

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Mike Halpern, CAFC
mike@franchiseqb.com

Joining us in the huddle today is Chad Harrison, director of franchise development with DoodyCalls and authority brands. Welcome to the show, Chad. Awesome. Thank you, Mike. It's a pleasure. It is great to have you here. So before you discovered the franchising industry, you spent many years in the restaurant industry and various management positions. I spent a lot of time in the restaurant industry myself, starting as a kid and then getting into the franchise side as I kind of got my career going. um Then you joined Authority Brands four years ago to lead the development of Duty Calls franchise, which is what we'll talk about today. I had Duty Calls franchise owner on the show last year, as well as the brand president, Larry Amos. He was great. So Chad, why did you decide to exit the restaurant space and join Authority Brands four years ago? Yeah, I'm a big foodie. love and I still love them. And I can, I can, I can relate to some restaurant owners that that passion side of it, but it's definitely grinding. You know, I mean, it's never an eight hour day, right? It's always 12 or plus. And, but there's still that passion. I love that business, but it was time for me to move on maybe about 15 years and then after COVID too, you know, and actually a lot of the restaurants started paying a little better because everyone was sort of leaving with COVID, right? And our entire restaurant crew, the GM and everybody had turned over. But even then, you know, it still just wasn't, I love the customer interaction. I love the pace and so forth, but it was, you know, it time for me to move on. And then we were moving from New Jersey down in North Carolina too. So it kind of worked out that way as well. And then, so at that point, you know, got the time to get a job, right? And so looking in the, looking online and found the opportunity for franchising and, and, and so Authority Brands and you know, David Martinez, and he interviewed me and grilled me with his questions. But he's a great guy and, and, and such a great talent that we have at Authority Brands. But hired in there and started, you know, at the low level of. You're just learning the business, understanding that it's not what you initially think of in terms of franchising, what you see on the streets when you're driving around, but it's just a huge world. And started working with authority brands and just oh a rich culture. Again, David Montanez, Michael Hutchins, all these guys just tenured and just excellent resource for me as I grew and learned the business. Yeah, no, that's great. And we kind of shared that in common. I was in the restaurant space most of my career. And then when pandemic hit, I pivoted to kind of buy side advisory and helping people get into all kinds of things, including restaurants, but a lot of other concepts like home services, like your business we're going to talk about today. And I did have David Martinez on the show about a year ago or two. He's great. I love the trade brands. I know he kind of oversees all the outdoor brands, so think he definitely linked up with not only a great company, but great people. So for anyone that's not familiar with the authority brands platform, can you tell us a little bit more about the company and its relationship to your brand DoodyCalls? Yeah, absolutely. So the company started around 2017 and they started with a few of the franchises, the cleaning authority, home watch caregivers, and now we're up to 14, including DoodyCalls. So what they've done from 2017 to today is they've purchased where they've seen the opportunity, DoodyCalls, one hour heating and air. They see the opportunity in these brands and growing and scaling and bringing in the talent, technology, and that's what we've done. to date and 14 brands, all home services. We've got emerging brands, young brands, and we've got all the way to pet waste management to HVAC. it's, and it's, mean, especially again, to your point with COVID and the restaurant business and such, but on COVID with home services, I think most know that it just did phenomenal. But we've got some strong brands, again, some great talent at the... at the hierarchy at the top end of it and down to the bottom. But yeah, 14 brands currently and some solid franchises. Yeah, it's interesting. A lot of the work I had done, you know, 2020 and previously it was all in the restaurant space. And then a lot of the stuff I've done over the past five years has been home services. It's a category that has been really attractive for a lot of reasons, namely because people are reinvesting in places they own and they don't want to move. The housing inventory is aging and there's just all of these opportunities to come in and help with that. Plus you don't need the brick and mortar, you don't need the big lease and it's kind of lower cost and scalable. And I know Authority Brands has a lot of concepts that kind of fit that description. So let's talk about DoodyCalls. What for someone that's not familiar with the pet waste management space, what is DoodyCalls? Yeah, we're, know, and Mike, you probably heard this a few times, right? We're number one in the number two business, right? We've got, yeah, we have some fun with the brand for sure, you know, making yards safe again, all that fun stuff. But DoodyCalls, authority brands bought DoodyCalls in 2018. There's about 30 franchises at that point. And we're a pet waste management company. So multiple. Oh, no, go ahead. this behind my desk here. It's the DoodyCalls kind of stress reliever. That's got that little QR code there. I got this one. I'm sure you gave this to me at one of our conventions. yeah, yeah. And they're just there. I mean, think that's the and I, yeah, I call it the OG emoji. It's like the first one that came out to right. But yeah, Pet Weasel management, it's it's, you know, and I came across a quote. simplicity is the ultimate sophistication and this brand just lines up there. At the end of the day, yeah, we're just picking up poo, but sophisticated, automation, systems, processes, and again, authority brands taking it to that next level. But at the end of the day, yeah, just waste management. Yeah. And I want to get into misconceptions today. I think that's a really good theme to stick with because we can talk about a business that's around poop. There's all the tongue in cheek jokes and all that stuff, but it's a real business. It's a scalable business. It's a very successful business. So let's talk about some of the misconceptions and being on the development side. I'm sure that you have to address them all the time. So, you know, the first one is it seems like your clientele have to be super wealthy individuals that don't have the time or the interest. in collecting their pet waste. mean, is that accurate? And what are the demographics that you generally see in a franchise owner's customer base? Yeah, that's great. I'm glad that we're hitting some of these misconceptions too, Mike. And then past podcasts we've had, some of them are just kind of the business aspect of it. But it's great to get into these questions. I'm sure some of your listeners have them, your followers. So when you look at the customers, mean, it really is the middle class. Middle class is the backbone of our customer base. And then we've got You know, middle class being, you know, income levels from 85, 90 up to 100 to 125. Um, know, families are just too busy really to go into that. mean, honestly, they'd rather pay for the service and spend time with their family. So there's a value that's added there. Um, and then we've got retirees, uh, individuals that can't physically pick up after the pets anymore, or they go outside and the temperature, whatever it is, hot or cold. And so we add value there, and pets are a big part of their life, even on a fixed income. And then you definitely have maybe the more affluent that will be a part of customer base too. yeah, ultimately that middle class. Yeah. and you spoke to the hot and the cold as being sometimes, you know, it's too hot. They don't want to go out. It's too cold. Where I live, we have, you know, beautiful weather and like for a month in the spring and a month in the fall. And then it's either too hot, too muggy, too cold, too windy, too rainy, you know, that type of thing. So um tell us about like the seasonality. I'm sure people perceive this as a seasonal business. What's it actually like out there for owners? Yeah, we're running four seasons. So we have a franchisee that runs and operates in Boston, Massachusetts. It's been running for 20 years. We're up in Wisconsin. We're up in Michigan. then to your sunny, humid states, your Florida and so forth in Texas. So we run all year round. We joke around again to the puns. Pets just keep doing what they do. whether it's on the snow or underneath it. so we continue to run and operate. It's definitely an advantage for the. Yeah, that's good. It's good to find because a lot of times people say, well, if it's painting and it's too cold, we have to go inside and we miss out on that work. mean, in your business, you know, pets are going to go to the bathroom year round. They're not going to stop because it's too hot or too cold. So that, that makes sense. so let's talk about like when you envision this service, it's more residential. Can you speak to the commercial component? Because I think that's where things get really interesting in any home service business, including yours, where know, residential is where you're going to build those relationships and you're going to go through your digital client acquisition. But then the commercial is where it could be pretty interesting if you get in with the right people, the right landlords, the right HOAs, et cetera. So can you talk about the balance for a franchisee as it relates to residential and commercial? Yeah, so we see from anywhere from 60-40 in terms of gross revenue, residential over commercial. Now our target is we, mean, Amy Wise, who's an 18 year franchisee in Houston says that 50-50 mark between the two is perfect because one side or the other is always growing, whether it's, as we know, residential with homes, depending on rates and what's available on the market, inventory, and then to the commercial side, if houses are too expensive. like where I am now in Asheville, there's apartment complexes going up everywhere. And so that's the commercial side, there's apartment complexes. So a 50-50 mix is, you know, perfect, perfect mix. And then when you look at residential, just your individual homes, commercial, commercial is changing all the time too. It's interesting because they're taking pets everywhere. When you're doing any traveling, you'll see someone with a dog on the airplane. And so they have to have the pet stations. And so, And we actually have a franchisee that services in international airports. So airports, breweries, wineries, of course, dog parks. And then definitely a big part of it is your HOA communities, gated communities, not gated, apartment complexes, condos. That's our commercial side. And uh again, it's just changing because they're taking pets everywhere. mean, we added a franchisee in Indianapolis and they actually have a dog bar. So you go, you take your dog there, you get a drink and yeah, it's an interesting market. Yeah, yeah, I mean, that's the way it is around us. mean, people treat their pets like family and they take them everywhere they go and. that includes the extension of the kitchen. when they go out to restaurants, bars, wineries, breweries, they seem like there's always a designated area where it's pet friendly. that's kind of cool that that opens up like a whole new market segment for your franchise owners. So one thing that is really interesting about the brand, it's a relatively low cost of entry. And we'll talk about that here in a minute regarding item seven, but the flip side of that is It seems like it would be highly competitive because there's not a huge moat to enter the space. Can you talk a little bit about the competitive landscape? Yeah, so Duty Calls has been in business 25 years. And so even at that time, there was some competition. And it's grown. But it's still an niche industry. There's not a lot of competition. There's a few other franchises out there. And mostly mom and pops. I see maybe about four to five on average, where someone will get their own vehicle and figure, let me do this on my own. They tend to struggle because they don't have those systems processes, as we know with the franchise model, that proven system. But still relatively low competition. m Yeah. And you mentioned like the technology, I think that's going to be a big piece when someone's vetting DoodyCalls is like, how do we do routing? How do we acquire customers? How do we communicate with customers? How do we let them know that we're showing up and we've done the job. like all those little things that maybe an independent can't systematize is like done for you, you know, ready to go and allows the franchisee with DoodyCalls, just to focus on like giving great customer service. um most prospective franchise owners, when they're looking around, they want to see something that's essential. We hear the term essential services a lot as it relates to things that are also in the authority brand's portfolio, like plumbing, HVAC, electrical. Do you consider DoodyCalls to be an essential service? Absolutely do. And that's, again, to the franchise model, that proven system, having that history, 25 years in the business. I we've seen 2008, 2011, housing crash. You've seen, again, COVID, as we were referring to before. And then something more specific, like, again, the franchisee that runs and operates in Houston's flooding and natural disasters that happened. And the customers just come back. And so we consider ourselves an essential service. We have great retention between the commercial, residential, and again, no matter what's going on in the economy, we maintain our customer base and continue to grow. It's just one of the advantages of this brand. People love their pets. Pet ownership, I've got my pets here, and so it's a service we're willing to pay for, grooming, pet waste management. And so, and now you've got new drivers behind it and they weren't always there again, 25, 30 years ago, they were there, but not to the extent they are now, like shelters, adoptions. see my wife goes on Instagram and someone will, will adopt a pet that needs a major surgery. It's going to be very expensive. They do go fund me, get the money for the surgery. And so it, and then find a house for the dog. So it's impressive what's going on in terms of the passion behind pets. just makes it an essential service. Yeah, yeah, makes sense. And you're totally right. Like the trend continues to be towards, you know, more pets in homes, more pets in public like that. I don't see it changing anytime soon. So the perception is that DoodyCalls isn't a very sophisticated business because you guys trade in poop, right? That's that's kind of the joke. But ironically, like the majority of people that you and I speak with that are trying to enter ownership, whether they're going to do a full time, you know, owner operator, where they're going to be kind of an executive owner or maybe a semi-involved owner where they keep their other job. They want something that's simple to operate, right? That like is a lower investment. It's scalable, doesn't require skilled labor per se. So even though the perception is you're not very sophisticated, you talked a little bit about the systems and what authority brands brings to the table, Duty Calls appears to check many of the boxes of what most people are looking for in a business. Yeah, yeah, and that's where it, you we, you know, we target our, you know, our profit margins, right? We're looking for those, you you call it sweet spots. And so, you know, to obtain those, and again, this is where we separate ourselves from the competition out there, mom and pops and other franchises is hitting those metrics. And so we're doing that through having systems processes, uh buying advantage through BuyMax, through authority brands, vendors. purchasing our trucks and then system software service minder optimizes it and you referred to it before optimizes the routes for our trucks no matter how many trucks you can actually dial in into each truck and individually see where they are how quickly they're moving from visit to visit invoicing real-time revenue it's just clipbooks integrated it's just impressive what they put together again to your point behind a poo business you know that the systems service minors outstanding. And then have a call center. Call center takes care of the phones 24 seven, 365. We've added when we like again, back to the puns, right? Duty bot, we've got an AI bot that'll cover the odd hours, but then we've got our sales team. It's phenomenal group. We run and operate and train them in Massachusetts. We run it from our level. And so they take care of the phones, booking, scheduling, pricing, getting the credit cards. We're a subscription-based revenue, so we have predictability on our revenue. That's just a phenomenal group, the weight average, the completion to sales. yeah, it's behind that, the marketing side, SEO's website. So everything that, to your point, a business owner is looking for that coverage and that level of, not complexity, but that level of... uh consistency and accuracy is within this model. Again, even for a poo business. eh So what is your process for finding the right franchise partner? Who are you looking for that you have kind of over time realized that, they make a really good fit for us? Yeah, you know, and it's evolved for sure. know, at first you think you have to be a pet lover and maybe not so much the analytical for someone that's just looking for the numbers to work. And that's not what I've seen. As I've progressed with this brand, I've seen two owners come in that have bought the franchise that have their own business that grossed. They actually grew it to $10 million gross revenue a year. And then they bought their duty call. So I've seen that level. They don't have any pets. I've seen that level. I've seen, you know, SeaSuite, white collar, blue collar. So I think at the end of the day, whoever might be listening or interested, definitely worth, you know, reaching out to you and connecting because it's surprising again to some of the points that we're making that, you know, some, you know, misconceptions. It's another one too, as well as that. Again, I think it's an opportunity for anybody and everybody, matter whether analytical, pet lover or not, no pets. It's just well positioned that Yeah. So you're looking for good business people, people that can come in and really like follow the system, execute, take advantage of all the resources that have been established to kind of make the owners succeed in the model. So let's talk, I know we said low cost, you know, for some people that really don't know what that means, what is the startup cost range or guidance that you provide in item seven of the FDD? Yeah, so we range, and depending on the state, California, Florida, the price of running a business, we can be as low as 76 upwards to 100,000. And in each of those numbers, there's about 30,000 to 40,000 cash on hand working capital. So not just all of that investment. So under 100,000 initial investment. Yeah. and then obviously if you finance it, you're putting in a lot less from a cash contribution standpoint. so let's talk about item 19. Do you provide any earnings guidance so that an owner can say, okay, this is what I can expect that when I launched my business. Yeah, that's usually on the first call that I'll have with somebody is I mentioned this point, the potential. We actually had a franchisee, was a technician. And so they started buying, they bought San Antonio, Austin, just continued to grow from there. And so he is now the highest grossing franchisee, 3.1 million last year gross revenue for picking up Doc 2. he currently operate? Yes, he's got about nine territories. he's rye. Yeah. Yeah. and he scaled it to a huge business. 3 million bucks. Imagine doing 60,000 a week in sales in the Pupiko business. Like amazing. yeah. Top 25 % average gross revenue is around $1.2 million. And then our average gross revenue network wide, where we have some franchisees that do this kind of on the side weekends, evenings, and then franchisees that maximize the revenue around $400,000 gross revenue network wide. It's really strong. I mean, when you think about, you know, the margins that must be applied to this business, cause you don't really have much cost of bags, labor, marketing, you know, that type of thing. So this has been great Chad. Anything else you want to add to the discussion before we wrap up today? Yeah, it's again to the, I think, our points is just, it seems like a wild card on the front end, but as you begin to learn more about the brand, just, it's got some great automation systems processes and again, just the drive behind it, the passion for paths. Super. Well, I really appreciate you being here, Chad. And if anyone listening would like to connect with Chad and his team to learn more about becoming a Duty Calls franchise owner, contact me at franchiseqb.com or on x at QB franchise QB. I'll get you connected. Thank you, Chad, so much for taking the time to get in the huddle with us today. Absolutely, Mike. I appreciate having me.