John Baldschun bought into America’s Swimming Pool Co. in his 20s, just two years after founder Stewart Vernon began franchising his pool cleaning, maintenance and renovation business.
He set sales records his first year, 2008, in Chattanooga, Tennessee, hitting around $250,000; he was in the black in month number three.
“Those sales records are the minimum now,” with the first-year record today closer to $750,000.
“The new people coming into the system, I’m surprised and very happy for them,” he said. “I remember we were on a track to do a million dollars in sales in five years, and you have locations doing a million in sales in their second year.”
His goal for EBITDA, also known as gross profit and a key criterion for the Franchise Times Zor Awards project, is 20 percent. “We have exceeded that in some years, we have fallen short of that, but I think 20 percent is very realistic and healthy.”
He says corporate provides support but not undue pressure.
“Everyone wants to grow, but those sales goals are very much the goals of each franchisee. I never felt like franchising gave me a number, like you have to hit this number or else. The relationship we have with franchising, particularly as I meet other franchisees in other systems, is unique,” he said, especially with the continued involvement of the founder even after Authority Brands acquired ASP in 2018.
“Stewart was very genuine, he always thought the best thing for franchising is profitable franchisees,” Baldschun said, and Vernon is still involved and “very much accessible” today.
A newer line of business, construction, is growing faster than other revenue streams but also comes with complications such as finding and managing labor and containing costs.
“Maintenance and service are two more mature lines, so I want them growing 15 percent each year,” he said. “Construction is a big opportunity; we were up 25 percent last year,” as shutdown orders stemming from COVID-19 began. “Had I known what happened in the industry I would have invested more. As people quit traveling, a lot of those dollars went from other discretionary spending into the backyard.”
America’s Swimming Pool Co. tops the field of four in the Outside Pride category, as selected by the Franchise Times editorial team, in part because of a relatively low investment range of $101,089 to $138,344. Royalty is 8 percent of gross revenue, on the high side, but in subsequent years it reduces to 4.25 percent for franchisees between $1.75 million to $2 million in revenue.
Scott and Kristen Thomason, franchisees in Houston, signed on with the brand just as it changed hands, and in fact had to sign a second franchise agreement when the first became invalid. The couple have always been entrepreneurs.
“When we first met, we actually bought a four-wheeler, Jeep and ATV business in the Rocky Mountains,” eventually selling to a competitor, Scott Thomason said. They then went to North Carolina and grew a UPS/FedEx package business. “We’re all from West Texas out in the sticks. We started getting homesick. We decided we’re not getting any younger,” so they moved to Houston and looked into buying a pool route. That led to finding an ASP ad on bizbuysell.com.
“We’ve got the capability; it just would have taken a whole lot longer to build a brand. They had already tackled this beast. They had a model we could just follow,” he said. “It helps us leapfrog probably three or four years of grinding it out.”
The pair got a $150,000 SBA loan, and spent about $100,000 of that to get going. Their territory on the southwest side of Houston has around 13,000 swimming pools in eight ZIP codes. “That’s 13-, 14,000 pools we haven’t even touched,” he said.
And then there’s the renovation side, which is booming. “We renovate 30 to 50 pools so far per year; 2021 will be our second full year in business. We had about 300 percent growth from 2019 to 2021. We’re expecting 60 percent growth this year,” he said. “We’ve got three employees, and then Kristen and I. It’s getting to the point where we’ve got so many remodels, and then the new pool builds on top, it’s probably going to take my full time.”
He envisions a long future with America’s Swimming Pool Co. “The first pool I ever cleaned was Kristen’s dad’s, when we first met. That was 20 years ago. I said, I bet I could make some money in the business.” On that count, so far so good.