It’s a New Year – More Changes to Come

Now that we are rapidly approaching the end of yet another year, it’s time to start reflecting back on 2008. What a year of accomplishment we have enjoyed at RetroTax.

As President of RetroTax, my pride comes more from the title of co-founder than that of President. I am extremely proud of what my partner Al Newcomb has empowered me to create and of the relationships that we have already had the good fortune to enjoy. Be those with teammates at our offices in Indy, prospective or recently granted franchisees, or those for whom we provide services and/or do business, with all over the country. 2008 was an incredible year and we’ve only just begun.

Specific to our business, tax credits are evolving more now than ever, and we pride ourselves on being positioned to scale up to do even more for our clients, in the years ahead. As the Obama Administration and the new Congress take hold, we will see how and where they move with reference to an even further commitment to tax credits and incentives. Remember, over the years, our business model has grown under the leadership of both Democratic as well as Republican leadership. There is very strong bi-partisan support for the credits that we identify and administer for our clients. So, we see much more opportunity ahead as we move even further into the 21^st century.

For RetroTax, 2009 will be a big year and each and every day will bring change. We are a young, emerging concept, building new metrics as we continue to expand. With that growth will come evolution and members of our team will grow with us as well. Some will continue doing the jobs they do now, while others will move into new positions. This will make way for new people to join us and backfill those already existing posts or take on new opportunities that are fostered by our expansion. These are exciting, if not turbulent times to be growing a business, but you know the old saying, “what doesn’t kill us, makes us stronger.” At RetroTax, we're feeling stronger every day.

For franchising, as a whole, 2009 will bring rocky roads for some and brilliant opportunities for others. While some of this will be purely circumstantial, not everything can be blamed on politics, the economy, or the state of the world. For those that rise up and embrace change, there is an impressive opportunity to build wealth and legacy, albeit in some extraordinarily challenging times.

While most are forecasting that it will be 2010 before we see signs of economic recovery, hopefully things will begin to settle down in ’09. Personally, my modus operandi is to not spend a great deal of time pondering that which I cannot control. So, instead I will keep my eye on those things that I can influence, and therein lies the opportunity to grow our business, no matter what’s going on globally. Personally, I am very much looking forward to the opportunities that lie ahead for the RetroTax team in 2009.

For Further Education, Franchisors Should Follow the Media

Throughout my career in franchising, I have become a dedicated news junkie, especially when it comes to news that pertains to franchising. In many ways, this has contributed to my continuing education. By reading and absorbing news, I have been able to generate new ideas for conducting better business as well as assisting with the development of better methods and best practices for growing the concepts I have represented.

Both newbies and established franchisors should never turn their heads away from the opportunity to absorb more education. For franchising information, I read several online resources through LinkedIn, as well as other Web-based industry standards like Franchise Times, IFA Smart Brief, Franchising.com and Bison. Additionally, for news AND commentary, I check in pretty frequently with sites like Franchise Chat and Blue Mau Mau.

Personal media outlets also get my mind rolling. My all-time, overall favorite media portal has for years been The Drudge Report. Even though Matt Drudge has become more mainstream in more recent years, he is still cutting edge in terms of breaking news “long” before most mainstream outlets even get a sniff of the stories he sheds light on.

My wake-up call in the morning is syndicated radio bad boy, Don Imus. (IMUS in the Morning…check for local station listings at WABC Radio. I am mostly a talk-radio and TV junkie with an ear toward Boortz, Hannity, Limbaugh, O’Reilly, and Dr. Bill Bennett and of course, Imus. From the other side of the aisle, I tune in regularly to Chris Matthews, Keith Olbermann and even Rachel Maddow, for the other side of the coin. For some lighter entertainment, I’ll catch occasional podcasts of George Noory’s Coast-to-Coast AM to hear what the “conspiracy theorists” are espousing as the “plot of the day.” Don’t just listen to what you agree with. You will learn a good bit more by listening to ALL points of view, not just the one that you may embrace.

My point in presenting you with my daily media routine is to encourage you to follow the media. Become ingrained in it, as the media can get your creative mind flowing with ideas for growing your franchise. For new franchisors, the IFA Smart Brief and Insider, Franchising.com, and Franchise Chat are great tools for daily chatter. For more in-depth resource news and tools, look at Franchise Times, Franchising World and Franchise Update. All three are must reads for me.

RetroTax Continues Social Networking Expansion

What is your franchise concept doing in the Social Networking/Social Media atmosphere? If you aren’t connected, you certainly should be.

In the last year, I have created this blog. I have also entered the world of LinkedIn (many franchisors and suppliers are in this network) and have connected to several other communities that are subsets of LinkedIn, pertaining to diversity, franchising, and certain cities of interest around the country.

I cannot count the number of new relationships that have been born out of the online and face-to-face communities that I have become involved with in the past year. It’s viral in a good sense and quantum in the results that it provides to me.

Best I can tell, Franchisors are not as connected as they should be. Just this past fall, at the Franchise Update Leadership Conference, I mentioned blogging during the CEO Summit and every head in the room turned my direction, curious as to why and what I was doing in that virtual universe.

Blogging, no doubt, has helped build the RetroTax brand in the virtual atmosphere. It also has established a cultural link to both me and my brand for those who have just been introduced to us. It helps us capture moments in time that would otherwise be lost. It allows us to broadcast our moves and news globally without relying on a third party (such as the media) for all distribution. It has allowed us to gain a competitive edge in the world of franchising, as well.

In the years to come, do I see social atmospheres as the future of franchise lead generation? Yes I have. Yes I do. Yes I will. These environments may never drive the kinds of number that portals or paid advertisements might, but from a quality perspective, they cannot be beat. What are you doing with Social Networking/Social Media outlets? I am curious to hear from you, and/or, share more with you about what works for me. Feel free to reach out to me via email at stan.friedman@retrotax.com or leave a comment on this blog. I will surely respond.

Business Owners Still Have the Opportunity to Impact their Bottom Lines for 2008

As I have said before, RetroTax will do well in good times, but will also thrive in a down economy. The reason? We help businesses benefit from tax credits that in most cases, were completely unknown to its principals. When we approach potential clients, small or large, be they large businesses or or franchise concepts or units, the initial reaction to what we proffer, is incredulity. More times than not, CEOs, CFOs, and SVPs as well as entrepreneurs and unit operators respond with, “You’re kidding, right?” Once we educate them on how to capitalize on these credits and they begin to understand just how easy it is for them and/or their franchisees to benefit from these credits, it becomes a “no-brainer.”

Anyone who employs people should be taking full advantage of these wage-based tax credits to optimize their financial picture, no matter where their business is located. But, for those fortunate enough to be located in one of those geographic zones that the government has designated as a Federal Empowerment Zone or Renewal Community, well they shouldn’t just stop at ’08. What about ’07, ’06, and ’05? That you see, is why we call ourselves RetroTax. Everything we do starts with a look back. In fact, in these aforementioned geographic zones, qualified clients can amend returns from the past three years and actually reclaim taxes that they have overpaid, for not claiming eligible credits for those tax years in real time.

What we do is turn back the clock for them and revisit those three previous years from the current open tax year and assist them with recapturing as much as $3,000 per year, per qualified employee on their payroll. Better still, in many cases, these credits pass through to the owners of the business as PERSONAL tax credits, offsetting their PERSONAL tax liabilities, with carry forward opportunities that last for 20 years. So, plainly stated, unless, and until, our client’s 2008 taxes are filed, we can go all the way back to 2005 and recapture past opportunities to benefit from these credits. In tough times like these , what a difference that can make for the owner of a small or medium enterprise.

While April 15 is tax day for most of us, there are many businesses that file on one of the other quarterly deadline dates throughout the year. So, if a client files ’08 return s on April 15th, opportunities to recapture credits for 2005 are forever gone, once that '08 return is filed on April 15^th. But for a company that files their '08 return in August or on October 15, recapturing taxes that were paid for as far back as 2005 still remains an option, until that ’08 return is filed. The long and short of it is this; once '08 is filed, '05 goes off the table with it and then 2006 is as far back as we can reach on a retroactive basis.

In a nutshell, many companies, including small business owners, have tax credits that go unclaimed. I encourage you to reach out to us, or one of our franchisees and learn more about how to avail yourself of these opportunities. Or, simply visit us online at www.retrotax.com.

Temple Daily Telegram Highlights Minorities Rise in Business

Let's hear it for Texas. Some might argue that it is still the Wild, Wild West and a less progressive state than others, but when it comes to minority business ownership and job creation, many of those others could take a lesson from the Lone Star State.

Carroll Wilson's article, titled “Small business, minorities in business on the rise in Texas in the Temple Daily Telegram,” is cause for celebration.

America's face is changing and as it does, so should the faces of America's would-be entrepreneurs and business owners. They should reflect the faces of the residents of the communities that they serve. From the sounds of this article, health care and social services are taking the lead in terms of jobs created by small business owners. Now, savvy franchisors from these and all market segments would do well to invite business ownership, not just opportunities for employment, from members of these communities.

To read more about minority franchise ownership opportunities, visit the International Franchise Association (IFA) at http://www.franchise.org/ and search for information regarding Minority Fran. As the second term Chairman of the IFA's Minorities in Franchising Committee, First Vice Chair of its Diversity Institute, and one of the architects of this Minority Fran initiative, I'm proud to see Texas out in front on this one.

Did You Know You are Missing Money?

While there are billions in tax credits and incentives available to business owners each year, only a fraction are claimed. As we approach the end of another year, business owners should become better educated on what tax credits are available to them and how to collect them.

Tax credits are issued by state and local governments for a variety of reasons. As it pertains to the work that we do at RetroTax, these are employment or wage-based credits that are offsets to a business owner’s personal or business taxes. These credits are earned for the jobs that the employer has created for certain demographic groups or because the place of employment and the employees residence are located within one of nearly 200 geographic zones that the Federal government has slated for development.

The demographic credits are “one-time” events per new hire and can be equal to as much as $9,000. The geographic credits can be worth as much as $3,000 per year, per qualified employee and can actually be recaptured from the past three years (thus our name, RetroTax). Most everything that we do at RetroTax starts with a look back, then ahead. More about these credits and their values can be found on our Web site at http://www.retrotax.com/ under the tab titled “services”.

Over recent years, some notable tax credits have been added, especially for those businesses in areas where Mother Nature has taken a swipe at us and left victims of storms such as Katrina and Wilma and more recently, the floods in the midwest.

As for who can collect tax credits, who ever said that size matters? Most business owners, regardless of size, employing people that are not immediate family, may benefit from these credits. The point is, no matter how big or small your company, you should not pass up the opportunity to at least explore how much money you are missing by not redeeming these credits.

Again, for more information, visit http://www.retrotax.com/

Youth Movement Will Be Interesting

To my surprise, with no pushing or prodding, completely on his own, my son shocked me this fall, when as a high school senior, he told me that after years of hearing me pontificate, (to no avail) he decided to join DECA. He made me extremely proud, both of him and his decision to join legions of other young visionaries who will lead America's next wave of marketing and business professionals.

During my years of involvement with DECA as a judge, mentor and advocate of their national advisory board, I've met many DECA kids that blow me away with their appetite for knowledge, initiative, and an uncanny instinct for business. I've also met those who are still "testing the waters" and “just want to chill”. I think each matures at his/her own speed and accordingly find their own watermarks at the appropriate times.

Those kids that are driven to climb to the top, will potentially have a great impact on franchising. Franchising has always struggled with generational issues and legacy. Often, great “first generation” franchisees retire and leave the business to the next generation that may (or may not) possess the same level of commitment and/or passion for the franchised business. With the impact that today's DECA is having on higher education and creativity, today’s youth will, I hope, step in, step up and innovate the business model of franchising in the years ahead.

Another trend, that has been highly publicized in industry trades, is the “youth movement” that is afoot in franchising. I for one, have not just seen a lot younger applicants recently, but older, as well. Gen Y is certainly on the rise and there are many new concepts that lend themselves to the younger set. As we continue to slide into what certainly appears to be a deepening recession, I think too, that more and more boomers might try getting out of the stock market (if they still can) and reinvest what's left of their 401, 301, or hopefully not 201 (K's), into franchised businesses that they can control and protect, rather than sticking it out on Wall Street and praying for miracles.

For those boomers that do jump into franchising, there will still be the need to be reliant on our youth, to help operate their businesses. Organizations like FBLA, SIFE and my personal favorite, DECA, all provide incredible platforms for real-world experience for today's kids and tomorrow's business leaders. I am really looking forward to seeing how DECA helps shape my son's future interests and where my son and his peers go with their careers. While times are certainly changing, let's always remember that change is certain... GROWTH, is optional.

Franchise Industry Shows Cautious Optimism at West Coast Franchise Expo

This past week, Nov. 7-9, I traveled cross -country to speak at the annual West Coast Franchise Expo in Los Angeles. Some might suggest that it was less than a perfect time for the Expo, given the state of the economy, its impact on franchising and how the recent elections will impact both.

Everyone I spoke to though, seemed to express a similar sentiment – cautious optimism. Certainly, everyone is concerned about the state of the economy, but no one was willing to concede defeat or believe that the economic meltdown would defeat our (franchising’s) ability to continue to thrive as a business model. Nobody was going negative.

On the surface, some suggested that foot traffic was lighter than years past, but most franchisors that I spoke with were extremely pleased by the steady stream of quality of prospects that they saw. If traffic was lighter, it could easily be attributed to the state of the States. My belief is that the "perfect storm" of sub prime and what it did to tighten credit, coupled with the downturn in the economy and melt-down on Wall Street is the only reason why franchising's gotten caught up in the storm. Once credit issues loosen up though, even in a recessionary market, we should see franchising pick up steam again. The few franchisees I got to speak with were on par with franchisors in that they seemed upbeat and optimistic that today's economic troubles would not prevail.

The one thing I saw universally from franchisors, franchisees and suppliers was the absolute unwillingness to fold the tent and quit. That’s a testament to the backbone of those who live and breathe the American dream. I fully expect similar views and responses at upcoming franchise industry events. Just around the corner, I will be attending the Franchise Expo South in Florida, (Jan. 11-13), which will be my last opportunity to get a collective gut check from my peers, prior to the IFA convention in February.

One last word about the West Coast Franchise Expo... From top to bottom, Tom Portesy, president of MFV, continues to foster a great culture of professionals. Rich Del Giorno, Steve Gross, Joel Goldstein, Scott Burford, Fabio “Skinny” Scocimara (holy smokes how much weight has HE lost) and the rest of the MFV team have become like family to me. I look forward to seeing them as much as anyone else, when I attend these shows.

What The Election Means for Franchising

This is a historic moment in time for Americans of all races, creeds, religions and genders to celebrate. In his own words, Barack Obama said it best last night when he addressed his victory party in Chicago:

“If there is anyone out there who still doubts that America is a place where all things are possible; who still wonders if the dream of our founders is alive in our time; who still questions the power of our democracy, tonight is your answer.”

With a new President in office, franchising will face some new changes in the coming months and years. This election was a big win for organized labor. What bodes well for unions, though, does not bode well for employers, as well as for everyday “Joes”.

I am concerned about how all the “Joe the Plumbers” will fare under the new leadership. Everyday “Joes” that aspire to own a business and fulfill the American dream of limitless opportunity will likely be confronted with unlimited taxes. This will be something to watch out for in franchising, especially as franchisors continue to find ways to support their franchisees. Tax credits will become all the more valuable for all business owners, and the need will be paramount, for our franchisees to educate them on how the tax credits that we administer will help them through some potentially tougher times.

Thankfully, as far as the Senate is concerned, it fell short of the 60 seats needed to exercise complete control and avoid filibusters by the Republicans on controversial legislation. Some aspects of franchising will likely face some new and critical challenges, as new leadership steps in.

Politics aside, the election of our nation’s 44^th President is a historic mile marker for all Americans. No matter who won the election, change was necessary because nothing stays the same. While some shun it, change is a fact of life. Certainly, with the global economic meltdown and the state of the world in general, change is not a bad thing. Change, though, just for the sake of change, or change for the sake of emotion is not enough. Yes, we needed a change and we certainly got one, but now comes the difficult part.

Let’s see how the new leadership impacts us and where they take us. I am certainly happy that this 20-plus month election is finally over. Now it’s time to hunker down, adjust accordingly and get on with business.

Get the Most Out of Industry Meetings -- NETWORK

FRANCHISE UPDATE FALL LEADERSHIP CONFERENCE:
Pictured from left to right: Casey McEwen, Partner, FranSystems, Josh Greenbaum, student, Stan Friedman, Steve Greenbaum, CEO PostNet and Chairman, IFA

While attending franchise industry meetings, conventions, conferences, etc., my takeaways come from collecting information and experiences from the speakers. But there's more than that, much more. Beyond the speakers, the greatest value at these events comes from networking. Be it with a prospect for a franchise, a company executive that can benefit from our (RetroTax’s) services, someone that needs to meet me or someone that I need to meet... I cannot ever remember leaving an industry event without some golden nuggets... I'm talking about gems that make me richer for the experience, born out of networking.

In our down economy, franchise executives and partners are searching for better, more creative methods to grow their business – especially when attending industry events – and they're focusing more than ever, on building connectors, networks of shared information. Such was the case at the recent Franchise Update Fall Leadership Conference in Chicago. I know of no other industry or business conference where the franchising professionals in attendance are as caring and sharing as they are at this one, bar none.

The IFA Convention, in San Diego, will be the next big networking opportunity for the industry. By then America will have elected a new President and the economy will most certainly be in a different state than today (not necessarily better or worse, just different). It will be interesting to see what types of information franchisors, franchisees, and suppliers try to pull there. While the IFA Convention is the granddad, the largest of all franchise industry conferences, as with anything else, you'll get what you give at this event. Earlier this year I got to thinking about the upcoming IFA and said to myself, "Maybe this year I will go as a spectator, lighten my load and just enjoy the convention with fewer commitments than usual. Then I thought about it again – and said, nah.

IFA’s convention is loaded with incredible amounts of intellectual capital, crossing every conceivable discipline of franchising. Franchise development, operations, marketing, relationship building, legal updates, etc. There’s just so much opportunity to give, to get, and network. Whether you're attending for the first time, or for the 20^th, get focused on one or two issues that you deem to be amongst your highest priorities. Lock and load on those topics and drill down deeply with speakers, exhibitors and peers who are all there with you, at the same time, in the same place, for the same reason.

Don’t miss this opportunity to network and find business solutions. Then, fasten your seat belts and get set for the ride of your life in 2009.

Are You in Atlanta? The ATLFA Wants You!

For those of you not familiar with our franchise group, The Atlanta Franchise Alliance is a networking group that I Chair in Atlanta. Our mission locally, is to follow the IFA's model of bringing franchising’s best practices and people together. We meet several times a year to network, learn, share fellowship, and exchange valuable nuggets that help us each individually and collectively, to strengthen the business model that is franchising. Whether you are a franchisor, a franchisee or a supplier, you are more than welcome to attend any of our events.

In 2008 our Alliance grew significantly and in 2009, we are going to get bigger and better. We will grow by bringing in more people to our networking events and providing them with everything that they came looking for and more. We will host networking events on the following dates, so mark your calendars: January 15; May 21 (also an IFA franchise political action committee fundraiser); August 20; and November 12. Locations for these meetings are TBD and will be posted on our Web site, at least two weeks in advance of each event (http://www.atlantafranchisealliance.com/).

Anyone interested in attending these meetings can find more information at our site. Don’t hesitate to email me (http://www.blogger.com/stan.friedman@retrotax.com) either, if you have questions or would like to be added to our mailing list.

Franchise Appreciation Day Drives Business

As in the past, attending the International Franchise Association's Fall Leadership Meetings and Franchise Appreciation Day in Washington, DC, is about spreading the good word about franchising on Capitol Hill to politicians who represent the franchisor’s and franchisee’s communities across the country. In the past, when I worked for established service and restaurant brands, part of my mission in DC was to represent my brand to these politicians. This year though, was different.

Now, as Co-founder and President of RetroTax, a start-up concept, my mission took a slightly different tack. Sure, I still attended the leadership meetings as Minorities in Franchising Committee Chair and First vice-chair of IFA's Diversity Institute, but every bit as important, especially for my business, was meeting with potential franchisees and clients in the Greater DC area.

The reason I bring this up is two-fold. First, no matter what city I travel to, there's no shortage of interested parties to speak with. I mean who would turn down the opportunity to have thousands in tax credits made available to them, especially when there are no up-front fees required for qualifying? Second, I am establishing business for my future franchisees. I am validating the viability of these markets by ensuring companies are indeed interested in working with us. The RetroTax business model allows me to set up theses accounts virtually, without having a "physical" brick and mortar location.

Times are changing. Never before could I go into a new market, where I had no previous presence and be in business just like that. But, with RetroTax, I can travel to any of some 200 "Zone" markets and set up shop immediately. This should more than validate the potential of our opportunity for our future franchisees.

As in the past, Franchise Appreciation Day was a tremendous networking and relationship building event. This time though, it took on even greater meaning, because of the new relationships that I was able to generate, with potential new clients and franchisees.

Buffalo -- My Home Away From Home

"Wingin' it with the Mayor": Me and Mayor Byron Brown talking hot sauce, hot wings, hot franchises (RetroTax) and tax credits.

Backstage with Food Network Celebrity Chef and Frank's Red Hot Spokesman, Kevin Roberts.

Good morning from Buffalo.

I wanted to briefly check in with you and share a link from last night's news that highlights one of the few reasons I am in this great city --Buffalo Wings. This weekend marks the seventh annual National Buffalo Wing Festival, in which I am proud to serve as Chairman of the National Buffalo Wing Hall of Flame, a shrine that few of you knew even existed, much less that I serve as its Chair.

While this weekend has been about fun, this past week in Buffalo has been all business, with a tremendous amount of brand building and business potential for RetroTax- even some tax credit savings opportunites for several of the 30+ wing chains that traveled here from all over the country (more on that later). In the meantime, take a look at this news clip from last night and the photo in the link below. You just may spot me in both!

http://www.wgrz.com/news/local/story.aspx?storyid=60304

How to Attract More Latino Franchisees

As the Chairman of IFA's Minorities in Franchising committee, I felt it important to share "Boom Time: How to Attract More Latino Franchisees", an article published in the August 2008 edition of Franchise Times, with you. For the story, reporter Julie Bennett interviewed me, but more importantly addressed a very compelling topic.

First, this was an out box that accompanied the story:

Tips for attracting Latinos to your brand

• Advertise your products or services in Spanish media and on Spanish-language web portals, using a Hispanic advertising agency (for a list go to http://www.ahaa.org/, the site of the Association of Hispanic Advertising Agencies). Besides increasing your revenues, such ads indicate that you would be welcoming to Hispanic franchisees.
• Be Spanish-language friendly in your locations in or near Latino communities, advised Stan Friedman, a member of the International Franchise Association's Minorities in Franchising Committee. "If they love your brand as a consumer, you can convince them that they'd love you as a partner, too," he said.
• Reach out to organizations that are Latino-focused, like the U.S. Hispanic Chamber of Commerce (find your local chapter at http://www.ushcc.com/) or the National Council of La Raza in Los Angeles. LaShawn Cartwright, senior recruitment consultant for Chick-Fil-A in Atlanta, said she works with the National Society of Hispanic MBAs and the Hispanic Alliance for Career Enhancement, by speaking at their conventions and participating in their career fairs. Fifty of Chick-Fil-A's 998 operators are Hispanic and Cartwright hopes to increase those numbers.
• Reach out to colleges with high Hispanic enrollments. Angela Gonzalez-Rowe of the HHOA said her organization awards scholarships to Latino students enrolled in the hospitality program at Florida International University in Miami.
• Participate in IFA-sponsored minority events. The trade association's director of diversity Miriam Brewer said her office partners with local economic development agencies to host Franchise Opportunity Seminars around the country. Find a list at http://www.franchise.org/.

Boom time: How to attract more Latino franchisees

By Julie Bennett
As published in: Franchise Times - August 2008

Antonio Swad, of Dallas, created his restaurant chain, Pizza Patron, to serve low-priced fast food to the Latino community. Amigo (medium - $6) and Familiar (extra large - $8) pizzas have Spanish names and spicy toppings, like Chorizo sausage. Store clerks speak Spanish and all menu boards are bilingual.

But when Pizza Patron started franchising in 2003, "We looked for an area developer with a lot of capital who owned other restaurant concepts and could build multiple stores," said Andrew Gamm, the director of brand development. "We also sold a few stores to Latinos who were individual operators. But over the years we found that the individual owner-operators achieved success faster and tended to do a better job operating their restaurants. We did a complete 180 and now focus on finding more individual operators." The chain has 50 franchisees (for 70 locations), 29 of whom are of Latino descent, and hopes to attract more Latinos.

Since most franchise companies don't keep statistics based on ethnicity, we don't know how many other Latinos have become franchise owners, but many industry insiders estimate they make up only about 3 percent of the nation's 800,000-plus franchisees. If a restaurant company targeting Latinos failed to realize what good franchisees that ethnic group could provide, why should we expect mainstream franchisors to recruit them?

Because it's good for business. The country now has 45.5 million people of Latino or Hispanic descent and their numbers are increasing faster than the non-Hispanic population. So is their buying power. According to Chiqui Cartagena, author of "Latino Boom! Everything You Need to Know to Grow Your Business in the U.S. Hispanic Market," Hispanic households are larger, which means "they buy more of everything from groceries to fashion, accessories and cars." Hispanics spend a greater percentage of their incomes on shoes, children's clothing, electronics and home improvement tools than non-Hispanics, eat more fast food and, when dining at sit-down restaurants, arrive with larger groups. When Hispanics find a brand they like, they are loyal consumers.

Corky Calhoun, head of dealer recruiting - U.S. retail support for ExxonMobil Corporation in Fairfax, Virginia, said, "There's a strong business case for us to have more Latino dealers. Sixty percent of our gas stations have convenience stores, and we give our franchisees some leeway in stocking them. Someone who understands what products and services appeal to a Latino customer base will make more money, and so will we. We've had a number of Latino placements, primarily in the Miami area, but also some in New England, Chicago and Los Angeles. We would like more."

Multi-unit franchisee Guillermo Perales, president of Sun Holdings of Dallas, said he wishes more franchisors were as welcoming. Perales has 47 Golden Corrals, 78 Popeyes, 14 Burger Kings and five Denny's. Only Burger King has a program to recruit more Hispanics, he said. "I'm trying to help one of my Golden Corral managers become a franchisee by subsidizing his land and building and helping him get an SBA loan. Franchisors should be doing this by creating incentives, like reduced franchise fees or a short term waiver on royalties, to open more stores to minorities," Perales said.

He'd also like to see more Hispanics in franchising. Perales is pushing his franchisors to improve opportunities for Hispanics to buy their own units. "They don't have many Hispanics," said Perales, who has a seat on Burger King's diversity board. "Nobody has the net worth to become a franchisee."
Perales suggests programs that help longtime employees with loans or other financial strategies that help them open their own units, and he's been pushing his franchisors to do just that. "The Hispanics are a very hard-working culture," he said, adding that franchising would be a perfect fit for them. "Franchising helps you against risk. You're a part of a big system. All you have to do is follow the rules. You don't have to re-invent the wheel."

Several hotel companies, including Accor Franchising in Carrollton, Texas (Motel 6, Red Roof Inns) and Marriott International in Bethesda, Maryland, have diversity ownership programs designed to introduce women and minorities to the benefits of becoming a hospitality industry franchisee. Angela Gonzalez-Rowe, president of the two-year-old Hispanic Hotel Owners Association (HHOA) in Washington, DC, is aiming higher. HHOA's Hotel Investment Series targets high net worth Hispanics who could benefit from adding hotels to their portfolios. The association, modeled after the highly successful Asian American Hotel Owners Association, has 300 members who own or manage 150 U.S. hotels, including Michael Gallegos, whose San Diego company, American Property Management, has 45 hotels and ranks within the nation's top 25 hotel companies.

Casa Latino Real Estate in Danbury, Connecticut, ranks as the only real estate franchise targeting Latino consumers. Since CEO and founder Roberto Heering requires all franchisees and owners to be bilingual, "90 percent of our 40 owners are Latino," he said. Heering, who started franchising in 2006, said he recruits franchisees from professionals attending the National Association of Hispanic Real Estate Professionals and the National Association of Realtors events. The down real estate market is actually helping his cause, "because agents today aren't very busy and have the time to listen to a new concept," he said. "There are transactions happening. I advise Latino Realtors to join us because all you need is a seat at the table."

The same statement could extend across all of franchising. According to the U.S. Hispanic Chamber of Commerce in Washington, D.C., Hispanics now own 2.5 million businesses generating $38 billion in annual revenue. If more of them are encouraged to take a seat at the franchising table, the entire industry can benefit.

RetroTax Featured in Franchise Times

Empowerment -- RetroTax helps companies get credits

South Carolina businessman Joey Dixon had the concept 13 years ago: help businesses access tax incentives from the federal and state governments.

Stan Friedman, a franchise development executive for real estate franchise ERA, would head up the franchise end of the company. The third friend, Al Newcomb, would roll his similar businesses into Dixon's and then be charged with operations and sales.

It was a good dream, but the company they dreamed up was never launched. Dixon became ill with ALS (commonly referred to as "Lou Gehrig's Disease") a year after the trio got together, and died soon after. Newcomb went back to his business in Atlanta, continuing to offer tax incentive processing to businesses there, and Friedman headed back to franchising and ERA.

"Our paths were just not ready to connect in business, but the two of us remained friends and maintained our connection," says Friedman.

Over the years, when Newcomb and Friedman got together for dinner, Friedman said, "I would beg him to franchise his business." Newcomb, however, was content to keep it local in his hometown of Indianapolis.

Friedman, continued to be intrigued by the subject of empowerment zones, which was part of the tax incentive business. When he joined Blimpie International, Friedman used what he had learned from his friend and helped the company expand in empowerment zones - impoverished urban and rural neighborhoods in which businesses are encouraged to build via tax incentives in order to offer the community jobs and opportunities.

Fast forward to today

Friedman finally convinced Newcomb to franchise the venture. ACI Franchising was launched late last year under the brand name RetroTax.

The basic premise is this: RetroTax helps business owners gain federal and state tax credits and incentives. According to Friedman, state and federal governments legislate these incentives and a fair amount of the resulting dollars go unclaimed. The franchisees are trained to help businesses claim these dollars.

There are two types of businesses that can best take advantage of these incentives:

1.) Businesses that are geographically located in empowerment zones. They employ people who live in the empowerment zone and receive a tax credit for each employee. "Each of these employees could be worth up to $3,000 a year in tax credit," said Friedman. "Before you've made your first sandwich, if you have 10 qualified employees you have $30,000 worth of tax credit."

2.) Businesses with employees who qualify demographically. Certain demographics, such as employees who come from a family that may receive some assistance, those who are part of the Welfare to Work program or returning veterans with disabilities are employees who would be qualified to earn tax credits for a company. This could account for up to $2,400 per employee, per year in tax credits.

Stan Friedman, right, worked with Cincinnati Mayor Mark Mallory on city incentives that give tax breaks.

The RetroTax target customer is smaller businesses, said Friedman. "Most companies don't know these credits are available and don't have the resources to do the onerous paperwork to get the credits." Worse, he says, is that many of these small companies believe these types of credits are being taken care of by their accountant, and usually they aren't.

RetroTax franchisees charge 15 percent of the dollar value of the credit they help the customer gain. The franchisor splits that 15 percent with the franchisee, since the franchisor does the paperwork to claim the credits. "The franchisee is the relationship manager," said Friedman.

The best franchisee for the concept will be someone with high-level, tangible sales experience, he added. It is a home-based opportunity for someone who desires a 9-to-5 business.

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Finding The (Right) First Franchisee

TEAM RETROTAX™ welcomes our first franchisee Kevin Culkin and his partner Dennis Headings to our organization. Kevin and Dennis will operate their RetroTax business in Atlanta.

SIGNING DAY: (From Left) RetroTax's first franchisee Kevin Culkin; his partner Dennis Headings; RetroTax's President Stan Friedman.

Many emerging franchisors leave the starting gate without having had the benefit of years of franchise experience to draw from. So, they get very excited and thrilled when they launch their concept and sometimes rush into awarding their first franchise too quickly, or for the wrong reasons.

At RetroTax, we decided from the onset, that we were going to be very methodical about our process. We identified six key markets to focus on for our initial development and then looked at our established relationships within those markets, searching for potential franchisee leads. Well, I'm happy to report that the strategy is paying off, as we have just this week awarded our first franchise in Atlanta, GA and we could not be any happier about our choice. Not only will RT-001 operate in a very lucrative market for our opportunity, but he will do so literally in my backyard. RT-001 was awarded to someone that I have known personally and professionally for more than 18 years. Yes, RT-001 is a franchise development professional, turned franchisee. What's more, our kids have grown up attending the same schools and he and I have grown into our franchising careers together, albeit with different companies... until now.

It is with tremendous pride and pleasure that I announce Kevin Culkin as our first RetroTax franchisee. Kevin has the perfect skill set for our franchise, strong interpersonal skills, high level, intangible sales experience and the focus and resolve to succeed in our business. Just as my partner Al Newcomb and I go back more than a dozen years, how much better can it get, then to also have a known entity as your first franchisee. Well, believe it or not, it DOES get better, as Kevin has invited Dennis Headings, a 28 year friend of his, join him in the new business. Kevin and Dennis are here in Indy, training this week and preparing to hit the ground running next Monday morning. How sweet it is. More good news to follow...

So, What are Federal Empowerment Zone Credits Anyway?

When I decided to create my blog, I wanted it to be an informational, if not educational outlet for industry peers, as well as business owners and executives across the nation and around the world. One of the primary functions of the RetroTax concept is to communicate and educate. We make our living teaching employers how they may benefit from those that they employ.

This is important, because it’s usually nothing more than lack of knowledge, that prevents many business owners from redeeming what could rightfully be theirs, namely, BIG $$$. There are several elements of the Federal Wage Tax Credit Programs, but today, let’s focus on Federal Empowerment Zones.

The Federal Empowerment Zone (FEZ) Wage Tax Credit Program is an incentive program created to revitalize the economies of select communities across the country. These zones are often located in some of America's biggest cities: Chicago, NY, LA, San Antonio, are among some of the many. Specifically, the FEZ program provides employers, with a federal income tax credit of up to $3,000 per qualifying employee per year. Employers’ facilities or work sites must be located in the zone and employees must also live in the zone.

The FEZ credit is 20 percent of the first $15,000 ($3,000 max.) of an employee’s annual wages. Employers can take this credit for each qualifying employee through 2009 and apply it directly to their corporate tax liability. (Legislation is currently pending with strong bi-partisan support, to extend this program until 2016) In the case of “S” corporations, LLCs, Partnerships or sole proprietorships, these credits pass through and may be applied to individual shareholders’ or owners’ personal tax liability. In addition, credits are retroactive for 3 years, so that credits of up to $9,000 per qualified employee may be realized in the first year that an employer has us administer the program.

For purposes of this illustration, let me provide you with some insight as to the powerful impact that these credits can have on an average small business owner, when his business is located within the boundaries of one of these zones. For the purpose of this example, let’s take a multi-unit restaurant operator, owning 3 Quiznos, Blimpie’s or Subway type restaurants. Again, for the purposes of this model, I will suggest that each location employs 15-20 part/full-time employees at any given time, and that there would be an annual employee turnover rate of (+/-) 300 percent. Simple arithmetic tells us that this business owner generates (+/-) 180 W2s per year. If only 10% of his annual hires also live in the Empowerment Zone and are therefore, geographically tax credit eligible, the numbers would be compelling. The likelihood is that an even greater percentage of his hires would be eligible for these credits. Let’s take a look at what that means to the business owner:

Federal Empowerment Zone Credits
2008 Tax Year – 180 total hires (X 10%) = 18 qualified employees X $3,000 = $54,000

This program is retroactive allowing the business owner to potentially also claim credits for the previous 3 years.

2007 Tax Year - 180 employees (X 10%) = 18 qualified employees X $3,000 = $54,000
2006 Tax Year - 180 employees (X 10%) = 18 qualified employees X $3,000 = $54,000
2005 Tax Year - 180 employees (X 10%) = 18 qualified employees X $3,000 = $54,000

Identifying and administering these credits could potentially make or break it for many small and medium sized businesses owners, especially in these challenging economic times.

In this illustration, the small business owner could have potentially realized up to $216,000 in personal tax credits during the first year of this program’s administration. How many sandwiches would he have had to sell, to achieve that kind of windfall? What’s best is he could even carry these credits forward for as long as twenty years, if he couldn’t take full advantage of them in the current tax year.

To learn more about these Federal Empowerment Zone Credits now and where they are located, visit our website at http://www.retrotax.com/. Stay tuned for future posts to this blog, for more about Renewal Communities, Rural Renewal Counties and the Work Opportunity Tax Credits.

RetroTax ...More Than Recession Proof – Recession Friendly

I've really been feeling the pain of late, for many of my franchise brethren in the world of brick and mortar. Many franchisors and franchisees are struggling in this downward economy. With election year uncertainty, the rising costs of fuel and essentials, consumers are starting to tighten their belts and spend less. Franchisors and franchisees too, face similar problems, with rising costs of goods and overall increased costs of doing business. Additionally, many must now deal with tariffs and surcharges that have recently been imposed by suppliers and distributors that have no choice but to offset their rising fuel costs, in order to get products delivered to the franchisee's door. This leaves everyone fighting for every last penny and lately it seems, there are fewer pennies to go around.

Now, I'm not for a moment suggesting that we're bulletproof, but these kinds of problems pose no challenges at RetroTax. Sure, we too must fight for business in a competitive marketplace, monitor our expenses and cashflows, but we don’t face the challenges that most others do in a downward economy. In fact, our clients look to us to help them offset some of the negative cycles that this type of economy bestows upon them.

Since we help them redeem unclaimed tax credits and incentives and only charge a contingent fee for what we produce, our clients experience no up-front costs for doing business with us. Our brand actually thrives in a downward economy. More and more businesses looking for ways to offset rising costs, want to avail themselves of our services. While this is great for us, it will be even better for our franchisees.

When business is good and cash is flowing, our service makes nothing but sense for our clients. When business is bad and things tighten up, our service moves from just being a good idea, to something a bit more compelling. In this economy, our franchisees will have the ability to establish a solid client base now, and see it expand exponentially as the economy recovers. Now though, is a great time to begin building a book of business.

In times like these, those thinking about career changes and/or making the leap to business ownership, must really be cautious about what they consider. For first time franchisees in retail or food concepts, start-up and working capital requirements are quite likely higher today, than just a year or two ago. Alternatively, there are concepts like ours, that do not face the challenges of those increased costs. Our franchisee profile is that of a former executive, or one possessing high level, intangible sales experience and who will quite likely work from home or an executive suite. There are no expensive leases, build-outs, or equipment packages. (beyond perhaps those things that most people already possess, i.e. a computer, a printer, a PDA, a personal vehicle, and some working capital to see you through your start-up)

As odd as it might seem, a downward economy is actually somewhat positive for us, as the opportunities to build a client base increase, along with those looking for franchise opportunities that do not include expensive start-up costs. To me it all spells something that goes beyond recession proof, all the way to recession friendly.

In Memory of Tim Russert

Celebrity deaths tend to send us into an odd shock, especially when the dearly departed are in their prime; iconic in their fields; and moreover, when they play a prominent role in our lives.

That probably explains why I feel the deep sense of loss that I do, about the passing of NBC News political icon, Tim Russert.

As a long-time, self-professed news and political junkie, I’ve spent more than 15 years watching the political prognostication, interviews, wit and wisdom of Tim Russert, as Moderator and Host of NBC’s “Meet the Press,” as well as in his additional roles of political analyst extraordinaire for the NBC Network, MSNBS, CNBC, as well as online and in print mediums. Russert played a huge role in my life and he will be deeply missed by me and the many millions of others that have invited him into their homes each Sunday morning, as part of their extended families.

Tim Russert has been a larger than life inspiration to both my personal work ethic, as well as my life, period. For years, he has fueled my appetite for being as good as I can be, for being as thoroughly prepared as possible, for everything that I undertake, and for bringing the highest level of passion possible, to all of those things that are important to me.

I have never had the good fortune to meet Tim Russert in person, but he has nonetheless been like a best friend to me. He was someone that I could always count on to be fair and honest, from whom I always knew what to expect and got it. He was someone who never let me down.

It seems kind of ironic, that Tim Russert’s stock in trade was “walking his talk,” while often times interviewing politicians who only “talked” theirs. No matter which side of the aisle his guests came from, if one dared to sit for a Russert interview, less prepared then he was, Russert morphed into an equal opportunity hit man. He’d give any such guest a moment to remember for a lifetime. Like I said, I didn’t know him personally, but I nonetheless feel like I really knew this person. I guess that’s why his sudden death rocked me so hard. Russert was the real deal.

It will be Labor Day weekend before I have the opportunity to return to Buffalo, NY, (Russert’s home town) the one place that I know for certain, that like he, I share a great passion for. I will visit Russert Park in Seneca, NY, to pay homage to this great journalist, political analyst, and beloved family man, when I make my annual pilgrimage to the National Buffalo Wing Festival.

To NBC, the Washington News Bureau that he managed, to all of those in the political world, to journalists at other news organizations world-wide, to the millions of every day Joes, just like me, that loved this guy’s honesty, integrity, fairness and even handed delivery… Tim Russert WAS and will always be THE franchise of political television. For me, Sunday mornings will never be the same… at least not on this plane.

A Man’s Best Friend

I am a media hound – known to never pass up an opportunity to promote my business, brand or self... there I said it. Well this week, this hound passed the spotlight to a different hound of sorts, my dog, Honey.

Now, some of you are already wondering, what’s this got to do with franchising? Come on, you know better than to ask. In some shape or form, everything that I do, somehow ties back to franchising and this is no exception. Firstly, this story about Honey that I’m speaking about can be found at http://www.woofpatrol.com/, a website created and managed by Yvonne Conza, also known as Mrs. Tony Conza, my former employer, good friend and Founder of Blimpie Subs and Salads.

It seems like everywhere I turn, there are links to franchising relationships from the past and this time is no different. Over a recent meal with Tony, we were talking about our mutual love for dogs. I showed Tony a picture of Honey and he told me to e-mail it to Yvonne. Until then, I had no idea that Yvonne had created this wonderful canine-centric website. It just never ceases to amaze me, how many times franchising relationships wind up leading to places or opportunities that I never dreamed I’d go to or know about. It really is important to understand this, especially for those of us that are trying to further establish ourselves, our businesses and brands in the industry. Over the years, many of us have changed jobs, brands or concepts, but those relationships that we had with co-workers and friends at those places, shouldn’t end too, when a job does. Keeping in touch with our peers can lead to bigger and better things throughout one’s career and life.

So, I may be a publicity hound – but now, so IS my hound. Kidding aside, it's just another powerful form of networking... something to talk about... to be proud of... it's all about friends and family, the company I am building and about franchising, the business model that I love so much.

A Prayer Request for a Friend!

I had a bombshell dropped on me on Wednesday night when I learned that a member of my franchise family has been torpedoed by multiple attacks of Cancer. Anybody who has ever been a part of the good old days at Blimpie International, knows who Randy Pirotin is. For those of you that don’t, Randy has been the Area Developer for Blimpie’s Georgia territory for a great many years. Again for those of you that know him, you know what a heads down, head strong, get it done no matter what, fighting kind of guy he is. Now, Randy is fighting the fight of his life. If there’s anyone that I would bet on to win this battle, I’d put my money on Randy. That notwithstanding, I wouldn't mind tipping the odds a bit, in his favor. The next time you bow your heads in prayer, won’t you please put in a good word for my friend Randy? In advance... my sincere thanks.

Launching a Franchise... Not As Easy as One Might Think

It was just one year ago that my partner, mentor and friend Al Newcomb and I began the process of launching the RetroTax franchise, built on the foundation of years of success with his affiliated company, Associated Consultants, Inc. (ACI) Now, one year later, we are finally in the position to begin inviting prospective franchisees to join our system – which is a complete relief.

Heading into the process, I knew we’d hit some bumps and snags, as RetroTax is a first of its kind, unlike any other, fresh, new brand. Getting our disclosure documents approved nationwide has taken longer than I hoped, but, now, FINALLY, we are able to begin strategically offering our opportunity to franchisees. I must say, the ride has been well worth it, but I think I can liken it to building a new house, rather than buying one that was previously owned. All right, I’ll quit whining, because the truth is, while I don’t think I’d EVER want to do it again, I am richer for and have relished the experience.

This truly is a franchise opportunity like no other that I have ever seen. Each and every one of my peers that I have discussed this with over the course of the past year has been smitten by it as well. For aspiring franchisors, I offer this piece of advice: Patience is a virtue and like most impresarios, I fall really short on that P word.

One place where I may see some things differently than some of my peers, is in the discussion of unit growth and numbers. A lot of companies boast about how many units they will be adding in the coming years, proud of their growth and development. At RetroTax, our growth will be proactive and strategic, just like the development of our systems. We will only add six operating franchisees in year one – even though we have many more knocking on our doors. When I was a food franchisor, I always knew how to measure the need for additional head count internally, to support a given number of units added in the field. Given the newness of this business though and the fact that we will not only support our franchisees, but also provide services to and for our franchisees’ clients, we’re going to take a slower, more strategic and systematic approach to our development.

Not for nothing, but when it comes to bragging about numbers, my belief is that the only numbers that really count, are the numbers being generated by those that are already in your business, not the number of new units you are planning to add. Are your existing people making money with your business model? If not, adding more is not where your attention should be focused. We are going to do this right at RetroTax.

It's with a breath of fresh air that I happily say, "we’ve finally arrived– HERE WE ARE!"

Come on CNN, Where’s the Rest of the Story?

Was Paul Harvey the only member of the media that could tell the whole story? While it seems that the media has no problem with covering tax issues, they rarely demonstrate a true understanding of exactly what a tax credit is – and how tax credits can sometimes bring more to the bottom lines of business owners, than the products or services that they are in business to provide.

One example is a recent story by CNN – Hire an Ex-Con in Philly, Get A Tax Break.

While this story did a nice job of presenting the local spin on a Philadelphia program being offered for employers that create jobs for ex-offenders in Philly, it didn’t mention a single word about the treasure trove of Federal credits available to qualified business owners in the Philadelphia Federal Empowerment Zone and/or Renewal Community. What's up with that?

Stay tuned, for future posts, that will talk about a very special set of services that RetroTax provides to forward thinking visionaries in both the public and private sectors. I will explain how these programs are helping ex-offenders get a fresh start in life, while at the same time drastically reducing the rate of recidivism in these local communities.

Hello Ohio

Pictured is (from left) me, with Mayor Mallory and Miriam Brewer, Director of Diversity for IFA.
Open for business in Cincy

Meeting Mayor Mark Mallory in Cincinnati

I’m really proud to have had the opportunity to participate in an IFA Minority Fran initiative in Cincinnati on Thursday, May 1, 2008. More than 200 qualified participants attended this day-long educational program about franchise ownership that was sponsored and hosted by the IFA, Cincinnati Mayor Mark Mallory, US Bank, Coca-Cola, and a host of public and private sector sponsors. I wore two hats at this event, participating as moderator and speaking on behalf of IFA, in my capacity of Chairman of the Minorities in Franchising Committee and First Vice Chair of the IFA Diversity Institute, but also as a participating franchisor, seeking franchisees for RetroTax,™ my new concept and company.

Good things have already come from this event and I anticipate that many more will. My personal thanks to IFA Director of Diversity and good friend Miriam Brewer, for pulling this program together. With more than ten years of participation in these events, I believe that this was one of the very best ever. More on this, as it develops…