April 18, 2011 // Franchising.com // Fantastic Sams, a Beverly, Mass.-based hair-salon franchise, has plans to develop between eight and 10 locations in the Syracuse region in the next three years. The company currently operates 20 locations in the Buffalo market and about 10 in the Albany region. Fantastic Sams has operated in the Buffalo market for about 30 years, says Ellen Levine Loffredo, regional director and executive vice president of Fantastic Sams' Western and Central New York region. Loffredo is based at DIR Corporation in Amherst (suburban Buffalo), which serves as a regional franchisor for Fantastic Sams. "We're looking to just expand our presence throughout our territory," Loffredo says, noting the territory includes Buffalo, Rochester, and Syracuse. The company plans to establish franchises in the immediate Syracuse area and then expand outward, she says. "Our goal is to have about five in [the immediate] Syracuse [area]," she says. The firm is targeting areas that include DeWitt, Fayetteville, East Syracuse, Liverpool, Mattydale, Camillus, Fairmount, Baldwinsville, Cicero, and Oswego. The region also includes Geneva and extends south into Binghamton and Endicott, and east into the Utica-Rome area. When asked if the company is looking for a single franchisee for the entire market or individual store owners, Loffredo replied, "Both options are available." The majority of Fantastic Sams franchise owners are single-unit owners, she says, but the company will consider multi-unit development. The company is also open to a combination of both single-unit and multi-unit ownership, Loffredo adds. Fantastic Sams would like to begin marketing its brand over the summer and have its first Central New York location open by the end of the year. But as of now, the company is working to recruit potential franchise owners. "We don't have anybody locked in at this point," Loffredo says. The salons, which average about 1,300 square feet, are generally located in shopping plazas because of lower rental costs, signage visibility, ample parking, and the potential for attracting customers from neighboring stores, Loffredo says. A single Fantastic Sams location employs an average of eight to 10 people, both full and part time, Loffredo says. Although some of its larger salons will employ up to 20 people, she adds.
The total investment to open a Fantastic Sams hair salon franchise is about $150,000 in the Syracuse area, Loffredo says. The figure includes equipment, training, payroll expenses for the first few months of business, advertising, cash reserves, and opening inventory, she adds.. Other franchisee qualifications include a net worth of $250,000 and cash liquidity of $50,000, according to the website for Entrepreneur magazine. Fantastic Sams offers a training program for new owners and managers through its regional office in Amherst, says Loffredo. Cheryl Nader, a regional educator for Fantastic Sams serving the upstate region, will spend a week at a new salon, so the staff is fully trained on the company's operations, Loffredo says. "When somebody buys a franchise, they're buying the support and the support includes the training," Loffredo says.
Sam Ross founded the company in 1974 in Memphis, Tenn., according to the company's website. Ross started franchising the business in 1976, according to the website for Entrepreneur. Fantastic Sams opened 54 locations in 2009, more than 35 locations in 2010, and is hoping to open 35 additional locations in 2011, according to a company news release. The number of Fantastic Sams franchise locations has decreased from 1,371 in 2007 to 1,262 in 2010, according to Entrepreneur. The company eliminated salons in those years, Loffredo says. She says the reasons for closures "may include" the franchisee's refusal to update the salon. When asked how much revenue the company generated in 2010, Loffredo couldn't provide a specific figure, but noted the firm's franchise prospectus includes its financial information for DIR Corporation and its parent, Fantastic Sams Franchise Corp. Fantastic Sams doesn't have a specific revenue target for its franchised locations because "there are so many variations" in rental costs, but the firm works with each franchise owner on developing revenue goals, Loffredo says. Nader works with the owners and the managers to make sure their expenses are manageable, Loffredo says. "So, it really is done one-on-one based on their specific situation," she says. When asked about competing with the Supercuts hair-salon franchise, Loffredo says they're already competitors in the Buffalo market. "There are a lot of heads of hair that need to be cut . there's certainly room for the two of us," she says.
Fantastic Sams was the first nationally franchised hair salon and has grown to more than 1,100 locations over the past 40 years.