Toronto's Metro Convention Centre was teeming with the curious and tentatively entrepreneurial at Franchise Canada's 13th annual trade show Jan. 9 and 10, which featured 160 franchises ranging from the household names to the unknown and absurd, jostling for the attention of more than 5,000 potential franchisees who passed through. Here are three recent market entries that caught the eye of our Your Business correspondent:
The story: It started with some really excellent hot sauce.
Pete's Pepper Palace "was like a liquor store for hot sauce," Cameron Bailey recalls. "It was a one-of-a-kind thing."
Those in the know would stop by the store in Burlington, Ont., rifle through its selection and emerge with the spicy condiment they were seeking.
Mr. Bailey had been a devoted customer for only two weeks when the firefighter who ran the place as a side gig announced he was closing.
"I said, 'Well, what do you want for the whole store?'"
And for $6,000 down, plus monthly $3,000 installations, it was his. He moved to a better location across the street, changed the name, and added product as the store's customer base grew. The catalyst came when Ms. Bailey lost her executive assistant job in December, 2008. The couple poured all they had into the business. Now almost two-thirds of their sales are food, sold to hungry customers lured by word-of-mouth about the pulled-pork sandwiches.
The game plan: Proliferate and branch out: The Baileys are opening a franchise in Oakville, Ont., and they are in talks to start up a location in Hamilton, Ont., ideally near McMaster University's grease-loving student population. They also hope to open a "Street Eats" restaurant to capitalize on the area's plethora of summer festivals.
The opportunity: The barbecue pit market remains untapped north of the 49th parallel, Ms. Bailey argues: Most of their products are ordered from -- or owe their inspiration to -- the southern states.
The Food Network helps: Two of its most popular shows -- Diners, Drive-ins and Dives , and BBQ Pitmaster -- play off the increasingly popular grease-pit eatery.
The challenge: Building a brand. The restaurant is new and the Baileys' advertising budget nil. They're counting on over-the-top service (and servings) to keep customers not only coming back, but telling their friends.
The expert opinion: As a new franchise just getting started, it's important to screen potential franchisees carefully, says Franchise Development Group general manager Andy Klie, who adds you need someone with drive who can execute your vision instead of pursuing his or her own to the potential detriment of your brand. "With Hillbilly Heaven they're dealing with food safety," Mr. Klie said. "If, god forbid, one of your franchises makes someone sick ... one black eye like that in the early goings can really destroy your system."
The story: Rico Furgiuele bought the Oakville, Ont.-based indoor playground in 2007, when the original owner wanted out. "I think they were just tired of it," he shrugs. "The first day it's beautiful -- a couple of years in, not so much."
But Mr. Furgiuele saw the opportunity. So did his kids: Saverio, now almost two, plays there all the time.
Busy Bodies now offers not only a place for harried parents to bring active youngsters to blow off steam, but for private birthday parties as well. And despite a pummelling economic downturn and the proliferation of like-minded businesses threatening to elbow his out, "it's been a really good year."
So good, Mr. Furgiuele is looking to grow.
The game plan: Open franchises across the Greater Toronto Area, without getting too big too fast. Mr. Furgiuele figures two or three more locations will let Busy Bodies expand without getting ahead of itself. "We want to stay small, make sure it's done properly."
The opportunity: Busy young families in the sprawling suburban regions around Toronto need a place to bring their kids to play, especially when it's too hot or too cold to use outdoor playgrounds.
The challenge: Competition. In the past three years, Mr. Furgiuele says, he's seen half a dozen similar kid-oriented businesses open within a 20-minute drive of his. He's hopes to win out with Busy Bodies' appeal for both younger and older kids -- it boasts playground equipment for anyone ranging from young toddlers to the active seven- and eight-year-old set.
The expert opinion: Here, too, screening would-be franchisees becomes even more crucial, Mr. Klie says. "They deal with kids -- you have to be even more careful, [and ensure]the folks you're letting in have a passion for dealing with kids and are going to operate properly."
The story: Sean McRae started Newmarket, Ont.-based Highland Logic in 2005 as a solar lighting company, but branched out to the solar-panel business to take advantage of growing government and consumer interest in green power. Rather than try to market their own products to hardware stores across the country, something Mr. McRae's company simply didn't have the resources to do, "we wanted something we were more in control of." Highland Solar is the exclusive Canadian distributor for China-manufactured Andalay solar panels, which Mr. McRae argues are far more user-friendly than their traditional DC counterparts.
The game plan: Market Highland Solar's Andalay panels across Ontario and, eventually, Canada-wide -- targeting contractors and training a retinue of franchisees to use, market and assemble the product themselves.
The opportunity: Trends and timing: DIY green power is hot, and it doesn't hurt that the Ontario government's feed-in tariff program essentially pays both residential and commercial consumers to produce low-emission energy, giving demand for residential solar panels a huge boost. At Highland Solar's first trade show, Mr. McRae's spiffy panel-sporting booth pulled in more than 200 would-be franchisees.
The challenge: Familiarity. Few people know about the feed-in tariff program, or how it works. Even if they do, the prospect of starting a business where you set up power generators on a customer's roof can be a daunting one.
The expert opinion: Complexity and ease of use are going to be issues both in recruiting would-be franchisees and in luring customers, Mr. Klie said. Whereas a food outlet is easy to explain in the 30 seconds you can use to grab someone's attention, getting across the appeal and potential behind unique solar-panel technology your franchisees install themselves can be a challenge.
"It seems a little bit trickier on the installs and stuff. It seems that would be a bigger challenge for them," Mr. Klie said. "I know there are some government programs they're involved in, and I'd imagine there's some red tape involved, as well."