CASE STUDY: Two Men and a Truck

THE COMPANY

Mary Ellen Sheets never imagined herself being in the moving business—that is, until her sons Brig and Jon scraped together some money to buy a truck to help raise extra cash for college. Although they soon left the nest to attend school, Sheets knew a good idea when she saw one. In 1985, with $350, she started a company called—what else?—Two Men and a Truck. She wouldn’t have to worry about moving again and, more important, neither would her customers.

“Believe it or not, moving is ranked as the third most stressful event, after death and divorce, so there is a real demand for a service that makes the customer king,” says Sheets. “Our goal is to do things right the first time. The most important concern customers have about moving is that the moving company be there when it says it will.”

With its emphasis on putting the customer first, it wasn’t long before the Lansing, Michigan, firm was expanding its franchising concept across the United States, with Sheets serving as its founder and chief operating officer. By 2001, with her daughter, Melanie Bergeron running day-to-day operations as president and chief operating officer, Sheets was ready to take the franchise concept internationally.

THE CHALLENGE

One of the biggest challenges for Sheets and Bergeron was that they were only just breaking into the export market. Fortunately, they had attended an International Franchise Association training seminar in Minneapolis, where they connected with Bill Edwards, president of Edwards Global Services, a consultancy company specializing in international franchising expansion. “The biggest challenges for franchisers in going global is getting accurate market research and identifying potential master franchisees,” Edwards says. “In the case of Two Men and a Truck, they faced a third challenge known as market differentiation—otherwise, with plenty of moving businesses out there, why should a potential master franchisee in another country sign on with Two Men and a Truck? What makes it a cut above the rest?”

The company already had an answer to that question, as it placed an exceptional focus on customer service and sophisticated Web-based tracking systems. Those systems would enable Two Men and a Truck’s potential master franchisees to monitor quality control and to improve performance measures such as labor costs and the time it takes to complete a move. The company’s tracking systems created a potentially larger profit margin as compared with other moving companies. What Two Men and a Truck needed now was solid market research and a list of highly qualified prospects to convey their business model to potential master franchisees.

THE SOLUTION

Edwards Global Services was a long-term client of the Commercial Service’s Newport Beach U.S. Export Assistance Center and had used the center’s export counseling and other services to help several premier franchise brands enter international markets. Among these programs was the Gold Key Service, which arranges business appointments abroad with potential foreign partners, all set up and prescreened by the Commercial Service. Would Two Men and a Truck be Edwards Global Services’ next success?

By 2003, Two Men and a Truck, through Edwards Global Services, worked with the Export Assistance Center to search for a franchise partner in Ireland. The company was assisted by the U.S. Commercial Service post in Ireland, whose commercial specialists provided key market research and designed a customized search strategy that included reaching out to databases of existing and potential master licensees. An advertisement was also placed in a local business newspaper highlighting the company’s search for a master licensee. Then, in December 2003, Edwards met with nine qualified prospects in Dublin. Partially as a result of those meetings and ongoing follow-up by the Commercial Service and Edwards Global Services, Two Men and a Truck signed a master license for Ireland in May 2006 with DMG Services. The agreement was valued in excess of $300,000, and it included the rights for the U.K. market.

“From a practical standpoint, going international protects our brand globally and it lends credibility to the domestic market,” Bergeron says. “Exporting also makes us more competitive and allows us to diversify our portfolio and weather changes in the economy.”

LESSONS LEARNED

Edwards, whose franchising clients have benefited from many Commercial Service programs over many years, has some important suggestions for franchisers looking to go global:

  • Don’t cast a wide net when looking for potential partners. Instead, use the Commercial Service to target the best prospects. “Being able to meet with reputable, motivated prospects really helped us in targeting our search efforts,” he says. “Not only was it cost-effective for us, but it would have taken months longer on our own to narrow down the best prospects. The Commercial Service is a source of information, market research, and due diligence that we know we can depend on when doing business around the world.”
  • Register your trademark. “Not enough people do this, and if you don’t, it can really cost you a lot of money in the long run,” he says. He also recommends that franchisers invest in good market research and personnel training to increase their chances for international franchising success as buyers are becoming very sophisticated.
  • Know the culture where you are going to do business. For example, Bergeron says that when it comes to moving there are differences. “Americans have so much stuff and bigger houses, while people in emerging markets have much less,” she says. “In emerging markets, many families live together, but we are seeing a growing trend in the use of moving services as people don’t wish to trouble their relatives in helping them move.”

ACTION

  • Contact a business consultant. A business consultant that is experienced in the international market can offer invaluable advice. The U.S. Commercial Service is also an excellent place to start exploring your exporting potential.
  • Use the Gold Key Service. The Commercial Service offers this customized service in key export markets around the world. From making appointments with potential partners, to providing interpreter services for meetings, to helping you close the deal, ship the goods, and get paid, the Gold Key Service offers top-of-the-line assistance. Contact your local Export Assistance Center for more information.