RetroTax Adds Third Franchisee in 2008 – Big Plans for 2009

Me (Stan Friedman) with our newest franchisee, Iraida Bottazzi. Iraida will represent us in Miami-Dade and Broward Counties.

The good times keep rolling, as we are proud to announce that our third franchisee is already rocking and rolling in Miami. Iraida Bottazzi will manage relationships with the Miami-Dade and Broward communities and she provides us with a perfect “fit” in South Florida. Iraida is a tireless, extraordinary networker, has limitless energy, and as a former school teacher, that can educate potential clients to the opportunity available for them to redeem the tax credits that we administer. What’s more, as a native of Puerto Rico, she is fluent in both English and Spanish, a real advantage in the South Florida market, where that is more a necessity, than a luxury.

Iraida’s territory is home to an extensive Federal Empowerment Zone which includes Miami, Homestead and extends into Broward County as well. While Broward offers no Geographic Zone opportunities, it is rich in service businesses and restaurants, rife with opportunities to administer demographic credits for the countless businesses there.

Iraida is the third to join our growing family of franchisees. Our first two franchisees in Atlanta and Cincinnati are both doing quite well. Kevin and Dennis in Atlanta are gaining lots of traction with work already in the door and a very full pipeline. Their fourth quarter prospecting efforts are really paying off in Q1 of 2009. In Cincinnati, Jim, barely out of training, has already landed his first account, which also resulted in a referral to yet another and he too, has a very full pipeline. It just doesn’t get much better than that.

For 2009, it looks like franchisees four, five and six are already on the horizon. Keep your eyes on Chicago, Milwaukee, Washington DC and San Antonio. These markets are all in my cross hairs, with Boston and Buffalo/Rochester not far behind. And our growth won’t stop there. What we look for in our prospective franchisees is someone with strong interpersonal skills, comfortable dealing with high net worth individuals, executives and business owners. Big ticket, longer cycle, intangible sales experience and/or a finance background could be a plus, but the ability to communicate at high levels is the requirement.

As job loss continues to be a by-product of our nation’s economic woes, I would imagine more mid to high-level executives will be turning toward franchising in the next six months. As a white collar, Monday-Friday type B2B concept, appealing to those types of skill sets, RetroTax looks like a perfect fit for many of those displaced executives.

Prospective Franchisees... Where are they Hiding?

At this week’s IFA Convention in San Diego, one hot topic will certainly be about selling franchises in a down economy. As soon as I hear anyone serving up “selling" advice, I’m on my way to a different session. “Sorry, you have it all wrong.”

Even in this economy, I am still not "selling," just continuing to meet those people who might be right for our concept – based on referrals from friends, existing clients, affiliates and alliance partners. As I have said in the past, networking and developing relationships has proven to be much more effective than selling.

Normalcy, whatever that was, must be thrown out the window in these trying economic times. I can’t rely on “typical” marketing measures to grow RetroTax, Instead, I rely on viral and guerrilla marketing at every level. I don’t use mass media, to speak of, but rather, spread the word one mouthpiece at a time, or via press opportunities as they present themselves.

Franchisors should ABSOLUTELY look outside the box in marketing their concepts in the immediate future. (at least for the duration of 2009 and quite likely beyond) Always know where you are and how to act accordingly. There may have once been a time when just being in the right place at the right time was enough to insure success. Those days, if they "ever" existed, are long gone. Now, you not only need to be in the right place at the right time, but you’ve got to also be aware that you’re there. Then, you’ve got to know what to do about it and have the wherewithal to respond accordingly.

The landscape has changed and along with it, the rules of engagement. Understanding such will help you succeed in these challenging times.

FRANCHISE DEVELOPMENT, Not just about the Sale… It’s more about the Relationship

Many business people boast of their unique approaches to the sale of their products or services. Not to sound trite, but in the world of franchise development, it should NEVER be about the sale, but rather, about the relationship between the parties. Personally, I have no interest in selling franchises. It’s a new world, a new era and at RetroTax, a concept that I co-founded, and whose day-to-day operations I direct as President, SELLING franchises is a non-starter. No, I am not parsing words, with reference to the difference between “awarding” vs. “selling” franchises. I’m just telling it like it is. To date, each of our franchisees have been personal referrals. That notwithstanding, if a prospective franchisee presents himself to us, but does not meet or exceed our baseline for shared vision, values and ethics, they’re out of here, on the first pass, despite the fact that they may have been referred. That is not just lip service either, it is fact. It is real, it has already happened and it will happen again, I’m sure.

As the IFA Convention approaches, (barely a week away, in warm San Diego) it is important for fellow franchise executives and suppliers too, for that matter, to examine their selling practices. Take stock of this fundamental statement: neither your customers nor potential franchisees want to be “sold.” Rather, each of your prospective clients, customers or franchisees, would prefer that you appeal to a deeper level of connection, communication and relationship between all parties to the potrential transaction as well as to your product or brand.

My own personal experience repeatedly demonstrates that it’s more about relationships. Some of these relationships were built months, years, even decades ago. While some of these didn't provide any quantitative value at the time that they were created, several are now front and center and are intrinsic to the growth and development of my company.

There is actually no better evidence of this than the relationship between my partner and me. It took us more than a dozen years of talking about it, prior to putting our program together and our case study is just the tip of the iceberg. Beyond us, I cite the following:

RetroTax Franchisee No. 1, Kevin is an 18+ year friend and peer, a consummate franchising professional.

RetroTax Franchisee No. 2, Jim was a personal referral from our CPA.

RetroTax Franchisee No. 3, Iraida yet another personal referral, came recommended from one of my most highly valued IFA peers.

Prospective franchisees No. 4, 5, and 6, were also introduced to me via personal relationships, from other IFA peers, one of which is actually the President of yet another franchise concept. To my point, it’s much more about the relationships in franchising, than about the sale.

When you attend the upcoming IFA Convention, think about the relationships that you make, renew or update with new, old and established peers and friends. All of these connections represent opportunities for you to seize the moment, every moment, every opportunity, both real and perceived, with each and every contact that you make or renew. As my partner Al Newcomb so often says, no meetings are bad meetings.” As the old saying goes, “Carpe Diem.” Seize the moment and don’t let any opportunities that are worthy of your consideration, pass you by.

April 15 Knocking; Embrace Your Opportunities

While most of America files its taxes on April 15^th, there are a great many businesses that file their’s on any of three other quarterly dates throughout the year. However, since April 15^th is traditionally seen as our nation’s filing date, it is important for business owners to understand that there is still time to positively impact the outcome of their tax returns for 2008. In fact, there may still be time to actually reclaim taxes paid for years ’07, ’06 and ’05.

Specifically, I’m referencing the “geographic, wage-based employment tax credit program,” just one of several that we administer at RetroTax. Typically, we examine year-end payroll reports for our clients that send employees to work at sites that are located in Federal Empowerment Zones and/or Renewal Communities, nationwide. Using our proprietary mapping programs, along with other resource tools, we determine how many and which of those employees also live in these Zones, thereby creating tax credit opportunities for the employers. We calculate the credits available based upon the qualifying wages paid to these employees and along with all of the appropriate forms required by IRS, send that data and supporting documentation back to the clients and their accountants, for completion on their tax returns. If business owners have unknowingly left credits from prior tax years on the table, they may choose to amend returns from as many as three prior years and reclaim those dollars as well.

So, what if you’re not in one of these geographic zones? Well, don’t despair, as there are still opportunities for you, too. There are also demographic programs that may qualify you for wage-based credits as well, regardless of where the job sites are, or where the employees may live. We can administer those on a quarterly basis too, perhaps reducing the estimated quarterly payments that one would actually need to make, based upon the annualized dollar value of the credits anticipated.

Now comes the big question that every business owner we work with is interested in knowing: How long does it take to secure these tax credits? The answer to that question is very difficult to pin. Let’s break this question down into a couple of bite-sized chunks. First, with reference to demographic credits: while it is true that this is a Federal program, these credits must be certified by the individual states where the employment occurs. Thus, the answer to the question about how soon you will get the credit hinges upon the efficiency of each state’s certifying authority. That varies widely from state-to-state. We do most of the heavy lifting on our end, interacting closely with those that do your hiring, to be certain that each and every opportunity to certify an eligible new hire is realized, but at the end of the day, how soon those credits are actually certified, is a function of the individual states.

As for the geographic credits, they are realized with far more speed and efficiency, as the criteria for their generation is much simpler. Yes or no: “Does the business send the employee to work in a zone?” Yes or no: “Does the employee also reside in the zone?” Once we’ve documented this information from payroll reports provided by the client and mapped the appropriate address information utilizing our proprietary software, it is a function of creating a comprehensive supporting documentation package and providing that to our client, along with the appropriate IRS forms, for inclusion in their tax returns.

It is not too late to benefit from these tax credit programs for 2008. In fact, now is the time to jump on this and see just how much you may be eligible to claim. Remember, until your 2008 tax return is filed, we can actually research and potentially still have a positive impact on prior years ’07, ’06, and ’05 as well.

In any and all cases, what we offer are non-traditional administrative functions that most CPA firms do not provide. We are “SPECIALISTS IN THE ADMINISTRATION OF STATE AND FEDERAL WAGE-BASED TAX CREDIT PROGRAMS.” As such, we work closely with you, your Finance/HR professionals and CPA/accounting professionals to get the mission accomplished. Business owners should think outside the box in this economy. These tax credits provide an often overlooked and unrealized opportunity that many business owners should claim. We will be happy to fill you and your resource team in on the particulars. I’d be happy to hear from you personally at stan.friedman@retrotax.com

IFA Convention Less Than One Month Away

As you probably read on my previous blog post regarding Franchise Expo South, I am convinced that franchising will rebound from our tough economic situation more quickly than many other market segments. Still lots of rocky road ahead, but hopefully, this prediction will be shared by others in San Diego, at the upcoming annual IFA Convention.

This is going to be a compelling year for new ideas to come to the fore, regarding the growth and development of franchised businesses. These challenging economic times make attendance at this year’s convention all the more compelling.

Start-up franchisors – IT IS ESSENTIAL FOR YOU TO ATTEND THE CONVENTION. Once you are registered, start your planning. Use the Convention as your opportunity to get focused. This conference has gotten too big to just attend without an action plan. Tailor your plan around learning during the concurrent educational sessions and networking on the floor of the tradeshow. Don’t leave anything to chance with reference to connecting with and speaking to those who can most positively impact your business. The days of just running into the right people at the IFA are gone. Anymore, the convention is just too big to go and just "hope for the best."

Established franchisors – this applies to you, too. It’s a whole new world out there and you want to maximize every opportunity to positively return your investment of time and money.

Last word in these challenging times, for ALL franchisors, regardless of size or maturity of your brands, I invite you to make yourselves rockstars to your franchisees by offering them the opportunity to glean the benefit derived from the tax credits that RetroTax administers. By telling your franchisees that “but for the fact that you’re one of our franchisees, RetroTax would quite likely never have known about you or your business... and that because of that, RetroTax will perform these services at the single unit level, something that is usually available only to much larger businesses.” Feel free to email me (stan.friedman@retrotax.com) to schedule some time to talk, either at or before the Convention. I am looking forward to making many new friends at this year’s IFA, as well as seeing all of my long-time associates from all over the world of franchising.

Miami Franchise Expo Shows Traction, Despite Economic Woes

After attending last weekend’s franchise expo in Miami, I am pleased to report that franchising is still alive and well, as demonstrated by the strong attendance, and of course 80 degree temps. with sunny skies and low humidity didn’t hurt.

While the country is still in the throes of a credit squeeze and deepening recession, none of that seemed to get in the way of robust crowds in attendance at both the educational sessions and crowded floor of the show on Saturday. That said, let’s keep it real. Everyone is still nervous about what ’09 will bring and how long the economy will remain sluggish. (quite likely until the banks start loosening up their purse strings) Make no mistake though, there is no shortage of SBA guaranteed funds available. Rather, there is however, a stubborn, hoarding of cash, as banks just refuse to make loans and release funds.

On the networking side of things, I was able to enjoy some great success for RetroTax. I made many new contacts for business, both for our core services as well as referrals for franchisee prospects – and yet another, FROM OF ALL PLACES, ANOTHER FRANCHISOR!

This year is going to be tough, though, for everyone. If there's a bright side in the equation, it is that the extensive job loss our nation is facing should lead to stronger franchisee development. The credit squeeze more than the recession, is what's adversely impacting us right now. I believe that most are confident that once the second half of the TARP money gets released, the economic stimulus should start heating things up again.

Business in ’09 will not, cannot be done like it was in years past. There will be winners and there will be losers. The difference, in large part, will be determined by how one plays his hand. Let me hear from you with your thoughts.

Readers, what did you think about the expo?

DECA Student Earns All 121 Scout Merit Badges – A Nearly Unprecedented Feat

When my phone rang at about 6pm on New Year’s Eve, the Caller ID said “unknown caller,” I hesitated before answering. But then I thought, “What telemarketer would be making calls now?” I took the call and to my surprise, I was glad that I did. It was Shawn Goldsmith calling.

Who, you ask?

Well until last spring I would have asked the same question. When I met him, Shawn Goldsmith was a remarkable, 17-year-old graduating senior at Oceanside High School, on New York’s Long Island. We met last April, when I had the privilege of representing the IFA at the DECA International Career Development Competition (ICDC) at Atlanta’s Georgia Dome. IFA invited me to present the award of their Don DeBolt scholarship to its 2008 winner, on stage and in front of a crowd of 18,000 at the Georgia Dome, as part of DECA’s annual Main Event. That winner was Shawn Goldsmith. (See more about DECA and the ICDC in previous blog posts or at www.deca.org)

Now, let’s fast forward the tape to Shawn’s phone call to me on New Year’s Eve. Was he just calling to wish me a happy new year? Well, sort of, but it was more than just that.

It was with incredible pride and enthusiasm that Shawn explained that he had achieved yet another amazing feat and wondered if I had seen or heard about it on the news. Seems that this young guy, now a freshman at NY’s Binghamton University has once again achieved something that few before him have accomplished. Shawn, a long time Boy Scout has gone on to the ranks of Eagle Scout, which in and of itself is an achievement to be proud of, but hardly remarkable. What is almost unprecedented though, is that while it takes 21 Merit badges to achieve Eagle Scout status, Shawn did not stop there. In fact, he achieved all 121 Merit Badges offered by the Boy Scouts of America, something that the local arm of the organization called, “an almost unheard of feat.” Now, that IS remarkable.

Given the news we seem to wake up to each day, telling us what's wrong with America, I proudly share this story with you here. Remember the name Shawn Goldsmith. This young man is a symbol of what’s right with our country. If you can think it, you can do it and Shawn provides clear and living evidence of that. I don’t know where or when you may hear his name again, but given his accomplishments to date, I'm confident that it will be sooner than later. Congratulations Shawn and Happy New Year to you too.