🔒Feeding frenzy: Mirroring national comeback, franchises are growing at a fast clip in Maine

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Dunkin’, Subway, Ace Hardware, Aroma Joe’s. Even in Maine where every community boasts mom-and-pop businesses, branded franchises owned and operated by local entrepreneurs are a growing part of the business landscape. Along the way, those businesses are creating jobs and investing in real estate.

Take Firehouse Subs, a Jacksonville, Fla.-based 1,200-restaurant chain with six eateries in Maine. It has a new location at Rock Row, a 110-acre, $600 million mixed-use development in Westbrook that opened last December. The Firehouse Subs is near a Chick-fil-A, of the much larger College Park, Ga.-based brand, that opened two months earlier to lines of customers.

“We anticipate this is going to be a very busy location, but we intentionally did a very quiet opening,” says Michael Koman, a Firehouse Subs franchisee with his wife, Michelle, since 2016. If business stays strong in Westbrook, the Falmouth residents ultimately aim to close their stores in Biddeford and Dover, N.H., and focus on their newest location.

Mirroring a national comeback, franchises are growing at a fast clip in Maine, offering aspiring entrepreneurs a quicker, less risky route into business ownership backed by established brands. As tenants, they’re also highly desirable to commercial developers like Waterstone Properties, the Needham, Mass.-based company behind Rock Row.

“While it is very attractive to have national names like Firehouse Subs, Chick fil-A, Starbucks and REI in our tenant mix, it didn’t happen by chance,” says Josh Levy, a founding partner of Waterstone Properties. “They were carefully targeted because each provides products and services that guests, workers and residents of greater Westbrook and all of Maine value and want.”  

Franchise frenzy

In Maine, there are 272 franchise brands and 1,433 units from eateries to retail stores and other businesses owned by 864 franchisees, according to information compiled for Mainebiz by FRANdata, a market research company based outside of Washington, D.C. 

After 2020’s slump, the sector was expected to open more than 26,000 locations nationwide in 2021 for a 780,188 total, add 800,000 jobs and contribute $477 billion to U.S. GDP, the Washington, D.C.-based International Franchise Association projected. Experts are seeing bullish momentum.

“Everything we’re seeing right now is trending in the right direction,” says Jeff Hanscom, the association’s vice president of state and local government relations. “Overall, franchising has continued to rebound well since 2020. Like everybody else, we suffered some pretty significant job losses and closures most of 2020, but data on 2021 shows a solid economic recovery.”

Getting that same sense from retail clients, Peter Harrington of Portland-based Malone Commercial Brokers says investors are looking to franchises for growth.

“There’s so much money out there looking to invest in new ideas and new capital is flowing, and Maine and the greater Portland area are worth taking a fly at,” Harrington says.

Aroma Joe’s expansion drive

Among regional franchise brands, South Portland-based Aroma Joe’s has 82 locations in six states, of which 51 are drive-thru only, 28 are coffee houses with a drive-thru and three are stand-alone coffee houses.

In Maine, where Aroma Joe’s has 30 locations, another nine are in development, including one under construction in Scarborough and one in Topsham set to break ground this spring. Shops are also planned in Auburn, Lewiston, Winslow, Naples, Raymond, Augusta and Kittery, though some are still awaiting final approvals. 

The planned sites are part of a company-wide expansion over the next decade following 82.2% sales growth between 2018 and 2020.

“The way we’re set up corporately, and where franchising is set up with small independent operators, we were able to be very nimble when COVID hit and able to keep our shops open and our staff safe,” says Aroma Joe’s CEO Loren Goodridge. “We adopted COVID guidelines almost overnight. That allowed us to stay open when a lot of other shops were closed.”

Existing customers still needed their daily coffee dose and, with its drive-thru windows, Aroma Joe’s had the socially distant infrastructure in place long before the pandemic. 

He notes that while some franchisees had to sell because they may not have been a good fit, the shops have all been successful, saying: “We’ve had zero locations fail.”

Goodridge is a Navy veteran-turned-entrepreneur who got into franchising via a Subway franchise he opened in 2012 under the same roof as an Aroma Joe’s coffee shop, where he befriended the owners who had a dozen other locations at that time. Goodridge became Aroma Joe’s first franchisee in 2013, adding locations along the way and ascending to CEO in October 2018. Today, he also owns and operates six Aroma Joe’s locations and remains a multi-store Subway franchisee through Acadia Management Group. 

Like Goodridge, many Aroma Joe’s franchisees are military veterans, who get a 50% discount on the $15,000 upfront fee to become a franchisee, which comes on top of the required $75,000 to $100,000 in liquid capital new owners are required to bring to the table. Besides exclusive use of logos, systems and operations, the $15,000 fee covers a two-week intensive training course. 

Aroma Joe’s newest franchisees, Cody Currier and his wife, Catie, opened their first shop last August inside a gas station in Lewiston, where they employ 10 people. A Navy veteran who worked in the public sector for many years, Currier says he was originally drawn to the Aroma Joe’s brand as a consumer and felt an immediate connection with Goodridge as a fellow veteran. Business is booming so far, and the couple hope to open a second location later on.

“I feel like this is the beginning of Aroma Joe’s becoming much larger, and it’s nice to have gotten in early on to be a part of the growth,” says Currier, who says he relishes serving customers as much as running the business and blending coffee flavors to order. 

“I tell anyone, ‘If you can dream it, we can make it,’” he says.

Fitness clubs and hair salons

Franchises are also more diverse than most people realize, representing industries from child care and home improvement to fitness services, tutoring centers and hair salons.

With more than 15 million members and 2,200-plus stores in total, Hampton, N.H.-based Planet Fitness is set to become even bigger through the acquisition of private equity-backed, Winter Park, Fla.-based Sunshine Fitness Growth Holdings LLC, in an $800 million cash-and-stock deal agreed in January. 

In Maine where Planet Fitness has 11 locations, Mike Cleary is a commercial airline pilot-turned franchisee with clubs in Augusta, South Portland, Portland, Falmouth and Rockland.

Cleary owns the franchises through Granite Coast Properties LLC in Portsmouth, N.H., starting with the 2012 purchase of a Portland club that recently underwent an interior makeover. He added 4,000 square feet in Rockland last summer in a former JC Penney store for a total of 16,000 square feet and is preparing a move to a bigger space in Augusta in March.

Cleary got into franchising after 26 years of flying, going back to school for an MBA. His search for a business opportunity led him to Planet Fitness, which offers $10 monthly memberships in a welcoming environment.

“I’m very fortunate to have found a brand that has not only the economics, but also a purpose,” says Clearly. “I think that’s the key — finding a brand that has a mission.” Looking back, he recalls a steep learning curve when he started, saying, “The nice thing about a brand like Planet Fitness is that there’s a generosity of business intelligence shared among the franchisees.”

He says that was also a big plus during the pandemic, including a 100-page reopening playbook developed last year offering guidance on things like cleaning protocols and social distancing.

“It turned out to be an amazing asset, and we used it with health and government officials to demonstrate our brand leadership,” says Cleary, who has plans to open a sixth club this summer.

Elsewhere in the fitness space, Julie Marchese and daughter Paige Ferguson became CycleBar franchisees when they opened an indoor spinning studio in Portland’s West Bayside neighborhood in September 2019.

“Small business is hard no matter what route you take,” says Marchese. “We wanted to partner with someone that could really take it to the next level without having to figure it out alone.” She says that help came in handy during the pandemic, when CycleBar helped the franchisees find programs to apply to for financial help and was instrumental in keeping her business rolling.

CycleBar, the world’s largest indoor cycling franchise with more than 200 studios worldwide, is a brand of Xponential Fitness, an Irvine, Calif.-based company that went public last July. 

Marchese notes that while business ebbs and flows with the pandemic, her outlook is positive, and advises aspiring franchisees in any sector to “believe in your partner and what they will bring to your table. It is a long-term relationship that needs to benefit both parties.”

Tim Renyi, who runs two Great Clips hair salons with his wife, Hannah, feels the same way about the Minnesota-based creator of the “salon-in-a-box” business model. The couple opened their first Great Clips salon in Falmouth in May 2020, followed by Auburn a year later, with plans to open in Topsham in April.

“We don’t know anything other than COVID, but having a corporate brand behind us helps pave the way and provides answers,” he says. “Franchising is not an island, but offers a blueprint for success. That’s what you’re buying into as a franchisee.”

‘Curated mix’

Back at Rock Row, Waterstone Properties’ Levy says there’s no set formula or quota of independent owners versus franchisees at the development envisioned as a destination.

“Rock Row is proving that, if done right, franchises and independent business owners can wonderfully coexist and thrive off each other,” he says. “That curated mix is what gives Rock Row our unique brand personality.”

Statewide, the growing presence of national brands is a concern to some in terms of a possible disruption to Maine’s reputation as a place of independent retail — but one that’s also inevitable.

“Yes, there is a place for franchises in Maine, but could it alter the landscape of what Maine is known for? Sure, but there’s a market for it,” says Matt Lewis, president and CEO of HospitalityMaine.

Shocked by the abundance of donut places upon his arrival in Maine from California in 2021, he says, “The big brands like Dunkin’ and things like that, those are clearly important and valued parts of the Maine economy and the Maine experience. I don’t want to take away from that, but it does change the landscape the more that becomes the norm.”

Because of his hospitality industry affiliation and LinkedIn profile, Lewis gets frequent unsolicited inquiries as to whether he’d like to pursue a career in franchising. While he always says that’s not an interest, the inquiries keep on coming.