The Driverseat franchise is cruising to lead emerging brands offering chauffeur, assisted transport and designated driver services. Founded by brothers Brian and Luke Bazely, in Waterloo, Ontario the franchise currently has 24 units in Canada, with several more poised to open in the next 12 months.
Driverseat, which has been in business for six years, and has been franchising for only five, charges a flat-rate for royalties. This system creates an environment of trust and openness with the franchisees. Learn about how CEO, Brian Bazely, uses this approach combined with authentic coaching to set franchisees up for success.
What is your role?
Brian: “I’m the Co-Founder and CEO of Driverseat and my brother, Luke is in the role of Co-Founder and President. I focus on Franchise Development, and growing the businesses of the Driverseat franchise owners. Luke focuses on our corporate location, as well as developing the technology.”
What did you do before-hand?
Brian: “I spent a significant portion of my career in executive management roles with retail companies such as Toys R Us and The Beer Store, a province-wide beer retailer in Ontario. About ten years ago, I became a franchisee of Anytime Fitness. Through that process, I fell in love with the whole franchising concept.”
What do you like about working at Driverseat and how has the company developed over time?
Brian: “Every day feels like we’re either as passionate or more passionate about the business. The excitement surrounding Driverseat is quite something. My focus is far more centered on the franchise owners; my experience tells me that this strategy is the best way to create a great experience for our customers. I know that when I truly care for my franchise owners that they’re going to have their coachmen, which is our term for drivers, provide amazing service for the customers.
Our franchise system and the supporting technology provides a great deal of flexibility. I find it very rewarding when we have a new franchisee who joins our organization and as is able to travel more, experience life more, or as an example, is able to coach their daughter’s soccer team because of the freedom that the business provides for them. That’s the part that gets me super-excited every day. My passion is for them and for what they can experience in being part of the Driverseat brand.”
What is different about how you collect royalties compared to other franchise systems?
Brian: “When we designed the business, we decided to charge a flat-rate royalty versus a percentage. We elevate that flat rate each year for new franchisees coming into the system but “freeze” it for existing units. As the business gets larger and more sophisticated, we feel justified and qualified in being able to charge just a little bit more. Currently, it’s a $419 flat rate per month.
It’s a different system and there is a lot of debate with our accountants and other franchisors regarding this topic. They ask: “Why would you continue to use a system like this?” The answer comes down to why we wanted to launch a franchise in the first place. We are passionate about our franchise partners and we want to spend our time helping them develop themselves and their businesses. We don’t want to spend a lot of time on things with negative energy, like auditing their books.”
What did you want to avoid when you selected this system?
Brian: “There’s a natural friction point that exists in franchising that industry veterans are very familiar with. When a percentage royalty is charged, a franchisee can spend some of their day finding ways to hide money or sales results so they can pay less overall. This is not a moral failing on the franchisees’ part, it is simply human nature. The franchisor is then forced, as a result, to spend their energy on trying to audit or find that money.
We looked at that and said, “That’s a lot of negative energy on something that actually doesn’t really gel with our governance.” When you’re a flat-rate system, there’s never a doubt in the franchisees’ mind. They do not suspect an “ulterior motive” on behalf of the franchisor when we are trying to help them grow their sales.
If we spend a little bit more time on a business quote that they need to put together for a large sale, for example, there’s never the thought that we might be doing it because we’re trying to increase our own royalties – they know that we are in it for them. We spend our day doing what energizes our corporate office team – creating success for our franchise partners.
Would you be able to provide me with some concrete examples of this strategy in action?
Brian: A pretty significant portion of our business is B2B where we provide chauffeur and shuttle services for employees – moving them between production plants or warehousing plants for example. Landing these accounts represents more work in terms of sales, but the revenue opportunities are also far greater.
About a year ago, one of our franchise owners had one of these B2B opportunities and we were passionate about helping him land it. We pushed him to do a better job with mapping, and explaining the services and technology. We helped him put a significant effort into the presentation package. As a result of the group effort, he landed the sale. They still provide service today to that same customer and it sparked other sales from there.
When working with franchisees, we talk to them about their personal goals as well as their professional goals. A personal goal of one of our franchisees was to do a better job at handling herself in meetings and to be more comfortable in public speaking.
We created a plan to help her do two things:
- Present to a B2B prospect with her husband and business partner.
- Have her build enough confidence to showcase her expertise in front of our franchise group at an annual conference.
I was able to really push her on this and hold her accountable to the goals that she set. It resulted in her doing more business meetings, and it resulted in them building an additional revenue line. Both their profit and revenue increased – on top of that, she was able to develop as an individual.
How does this system foster a sense of trust between you and the franchisees?
Brian: “There are only two things that we really focus on:
- Top-line revenue and profitability for the franchise owner
- Trust between home-office and the franchisees.
When we have profitable sites and they trust us, that becomes the magical mix. Everything that we do is focused around those two very important factors.”
How does this strategy affect unit sales?
Brian: “We’re attracting higher-quality individuals because they are seeing terrific things happening within Driverseat franchise locations.”
What would you say the biggest challenge of operating this way is?
Brian: “It comes down to the lifecycle of a franchise system. Percentage royalties feed a corporate office. That allows you to purchase additional talent, resources, and better technology. When you charge a flat rate, in the early days, there are times you’d like to have higher revenue at the franchisor level to drive higher performance.
It has forced us to be extraordinarily smart in how we spend money and how we develop programs. The first couple years we ran the franchise system with just Luke and me. We literally managed tech development, marketing, franchise support, and franchise development with just the two of us.
But not once in any day that we’ve been in business for five years of franchising, have we said, “I wonder if this stuff’s being reported correctly. I wonder if we need to create an audit and find out if this information is accurate”. There is no incentive for a franchise owner to misrepresent their dollars.”
What advice would you give someone who wants to try a structure like this?
Brian: “You have to be focused on the long game to do this. If you’re focused on the short game and you believe that you’re going to have a small number of franchise locations that you need to rely on, then it might not work.
We look at this from a long-game perspective and say, “It really doesn’t matter what happens in the first handful of years. This is really about, how do you get to between 2,000 and 3,000 locations?” And we believe this is the single best source for doing it. If you are going to commit, don’t look back. It’s perfectly acceptable to increase the dollar royalties each year for new locations coming in. But, don’t look back and don’t get fixated on what “could have been”.
With everyone we interview, we ask a series of fun questions! Here is Brian’s Q&A!
What new belief, behavior, or habits adopted within the last five years have most positively impacted your life?
I’ve embraced the belief that entrepreneurs today should really be part of the new rich as described by author, Tim Ferriss. We should look to create financial wealth but not just chasing the dollar every single day. Instead, we should create enough wealth that supports a lifestyle that we want to live. The new rich, for me, is about the ability to earn revenue, which then supports time with my daughters and my wife, and time travelling.
For franchise owners, I try and bring this to the surface with them. It’s about going out and having a strong business that’s very healthy financially, but not for the purpose of upgrading the Lexus car from this model to that model, (you can certainly go and do that as well). Instead, it is for the purpose of being able to enjoy life, enjoy your family, and enjoy time which is one of our most valuable assets.
What purchase of less than $100 has improved your life?
I really love being able to pleasantly surprise somebody that works with us with small things such as a lovely meal with loved ones. For me to purchase a $50 gift card to a brilliant local Italian place that’s right around the corner from our office is a fantastic gift for someone who has gone above and beyond. For $50, you can have an amazing lunch there.
What would you put on a billboard?
Brian: “Spend your life purchasing experiences, not products – experiences with friends, experiences over dinner, experiences in social settings and experiences in travel.”
What books have you most gifted?
- The 4-Hour Workweek by Tim Ferriss is a terrific book for prioritizing your time.
- The Wealthy Barber by David Chilton is great to help give people financial independence.
- Love Work by Chuck Runyon who is the founder of Self Esteem Brands. He’s a really outstanding leader. And the “Love Work” book really talks about passion and the culture he built within Anytime Fitness.
- Good to Great by Jim Collins which is a factual study of how certain companies overperformed.
Ready to learn more about Driverseat? Read more here on their Franchise Opportunities page!
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