Today, we are talking with Nicolene Elhadad, who has a very very cool business that I just want to know everything about, and you guys are going to want to know too.
Nicolene is a multifaceted self-made millionaire who has grown truly from the ground up. She’s a mom of three, the owner of seven different businesses. And she strives to live her best life, full of energy and passion. What I’m really excited about talking about today, that I think is really unique about her business model, is that she helps other people with franchising a business.
We’re going to be talking with her about marketing and mindset. And with that, I’m going to let you, Nicolene, introduce yourself a little bit better. And then I’m going to ask you one million questions.
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Hi, Alison. Thank you so much. I’m so excited to be here. Your intro was pretty much a summary of my little life here on planet earth so far. I’m really an entrepreneur at heart.
Since I was little, I’ve always enjoyed making something and selling it, and I’ve always loved money and what it can create. I’ve had money and I’ve also not had money before, so I know I am okay going both ways. But I do know that when you do have money, it makes life so much easier.
And also I’ve learned through the past 14 years, how having money can help you change other people’s lives. That is really a very big force behind what I do in my businesses. That’s how I came to have seven different businesses today. Once you have money…I mean, you can make more, but it doesn’t change how you feel about it. It just changes how you change other people’s lives, which I get very excited about.
Yes. Oh my gosh. Okay, I love that we’re just starting this with a bang. I also love what you said at the very beginning, which is, “I love money.”
I mean, we all love money, but a lot of us have these hangups about feeling guilty for wanting it. And money just gives you options. It allows you to be generous. It doesn’t change who you are, it just changes what you can do. So I love that we’re starting out on that note.
The First Business
Let’s go back to the beginning, before you ever franchised a business, and just tell us how you got into entrepreneurship in general.
When Mahabi and I got married, we knew that we would have to start our own business. Finding a job was not going to be easy for both of us. We used to work on cruise liners for many years, so we lost touch with the local market.
So we started out first business from our garage. We were importing goods and then selling them. The main idea was for me to help him out for a couple of weeks because he doesn’t speak, well, he didn’t at that stage speak very good English. And he didn’t speak the local language here. We speak Afrikaans in South Africa and I thought, “Okay, I’ll help you out for a couple of weeks, and then I’m going to go do my own thing.”
It’s been 14 years and I’m still helping him out along the way now, but it’s been so much fun.
We have a very good dynamic relationship.
We’re known as a power couple, where he is strong, I’m weak and where I’m strong, he’s weak. So we really fill each other’s cups beautifully, but we do have a different kind of driving force. Both of us have had very low points in our lives.
When we started that business in the garage, we never said it, but we both knew that we never wanted to be there again. So it was almost like, this is the lowest we could go, which was great, it’s where we started. We didn’t have a lot of money, but it was kind of our driving force to just keep growing. It doesn’t matter how hard the road would be. And it was very hard, Alison, there were times where I remember crying myself to sleep thinking, “oh my goodness, this is as good as life’s going to get.”
But when you have someone in your life that supports your journey, whether it could be your spouse or a friend or a sister, it does make the hard days a little bit easier.
This is one of my big things that I help my clients with – just getting that mindset that you need to surround yourself with the right people. If you don’t have that kind of support, growing a business is really hard.
But we started from our garage, and then every year we grew a little bigger. We went out of the garage into our first retail store, and then we went from the retail store into a mini kind of warehousing setup. And we’ve grown ever since.
What made you guys want to start the importing business in particular?
My husband’s from Israel and he loves technology. He’s an engineer himself, and he just fell in love with the security products from Israel itself. In South Africa, the security market is a great business to be in. I was very good at sales. So we thought that the two of us together would make a great team.
And because this is a very man orientated industry, bringing a female to the table would tricky. It was going to be a new space for us, because I had a different way of looking at marketing, as women generally do.
I brought a whole new life to the security industry.
We were in our business for about six months when I got about three offers from our biggest competitors to come and work for them. Our marketing was so spectacular and so different; I think it was the female touch that I was adding to it. I was looking at it like, “Why would someone want to buy my products? Why should you buy my products instead of just showing the camera around the price?”
So I really enjoyed that venture, and that’s why we started looking at importing.
So you guys were really industry disruptors, especially because of the marketing side, that makes sense.
It’s almost like if a woman got into leadership in oil and gas in the southern United States, that would probably change the game.
Well, that would be me. I would be in high heels walking that platform, telling everybody what to do with their oil ring.
But over the past 14 years, I’ve always had a three year itch. I get a bit bored with what we do, and then I’d look over to my husband and say, “I think it’s time for something new.”
He would reply by saying, “Well, as long as it can help this business, we can do it.”
So every single business we’ve started so far was kind of generated from that main first business.
It ended up being an individual product or service based business so strong that it generates seven figures a month by itself.
We were struggling to get a service from a specific service provider; we got so frustrated, to the point where we thought, “No, we’re just going to start our own business to provide our main business the service, and then we’ll sell it to other people as well.”
That’s how most of our businesses started.
My fifth or sixth business was a salon that we started. It started because I wanted to spoil all my staff that worked in our companies, by getting free treatments every day. My husband said, “Well, you’re not going to hire a therapist to come in every day, you’re going to start your own salon.”
The next day, that’s exactly what I did.
I’m from the beauty industry, so I absolutely love everything about pampering someone.
I opened my own salon, and that was how we treated all of our staff for free, every day they could come to the spa, have free treatments. But the therapists, they wanted to make more money, so they ended up running it as a profitable business. And we ended up making six figures a month from that as well, because I just said, “As long as I can take half the profit, you can get the rest.” That’s how that business was generated.
Sometimes we look at starting a business as just an opportunity, and it’s almost as if I’m asking myself, “Could this possibly work?” Why shouldn’t it work? What can I do to make it work? It’s that inner challenge that I’m putting to myself. That’s what makes me take action.
The Coffee Shop
But my big thing, Alison, is actually five years ago, we started my little coffee shop. This was a big, big challenge. For the first time, we actually had people tell us that we shouldn’t do it. We had people say, “You have no experience in the food and beverage industry, you shouldn’t go into it.”
It was hard for me not to take it personally, because at that point I was already a millionaire. I was already making good money. Still people would have this mind block: according to them, I didn’t have the right experience.
But I saw an opportunity, a niche in the market. I thought, “Oh, I could do this, why not? Everybody else is doing it.” I saw all these coffee shops; I love going to coffee shops.
It took two years to plan it out.
I went to over 120 coffee stores and drank a lot of coffee, observing how people do business. Then I started doing my research, and I made it according to my little picture that I had in my mind. Five years ago, the first coffee shop was born, and today we have 31 stores across the country.
Franchising a Business: From the Garage to Seven Figures
Oh, that is so amazing.
So, now, going from starting in your garage to seven figures. What are some of the key takeaways that you would share with someone about starting a seven figure a month business?
Obviously, importing is different in a lot of ways. But for other entrepreneurs who are wanting to aim for seven figure months, what are the things you need to be thinking about early on or in the middle to help position to get there?
I have so many different businesses. Our other business are, like I mentioned, the coffee shop, the salon, a restaurant, an accounting firm, and an HR business that we’ve done with a partner. I can tell you that there’s a lot of difference between service and product based businesses.
My one biggest tip would be from the beginning, do not try to sell to everybody.
Your client is not everybody. You could never do that.
Even in my coffee shop, where we do serve so many different dynamics of people, I still have a main audience that I’m trying to attract.
When people start a business, they’re so hungry for the sale, so hungry just to serve as many people as they possibly can, that they miss this key element. Stick to what you know, what you want to be known for, and go full force into that.
Because when you have one solution that you’re giving people for their concerns and problems that they have, that’s what you will be known for.
You can always grow more businesses after that. Even if you have a salon today, you can have a whole menu of 20 services that you offer, but be known for something. It can be your amazing customer service, your pricing, the TLC, whatever it is that you add to the space – be known for that.
You have to physically plan out your numbers. I’m a very big numbers person.
If you want to make a million in a month, you just need to figure out what you’re going to sell, how much you’re going to charge for it, and how many people need to buy it. That’s a real straight out number.
Now, the number might be huge and it might be very scary and overwhelming, but at least you have the number. It’s not seven figures anymore. It is now a smaller number. You know that you need to sell it to 3000 people at this specific amount, or to 300 people at this specific amount.
And then, you also already know what product and service you’re going to use to get to that amount. Then your next step would be, how many am I going to sell each day? And what’s my tactic going to be? How am I going to sell it? Who am I going to sell it to? Where am I going to find those people? These are all the hows afterwards.
But you first have to realize that it’s very doable. It is a numbers game. It is not just seven figures. When I work with my clients, I move away from the seven figures. We break it down completely to how many sales you need to make per day of that specific facial or that specific program that you’re selling or that amount of houses, or whatever your industry’s in, because smaller numbers makes it more realistic.
How Nicolene Got Started with Franchising a Business
Okay, so then talking about the coffee shop and franchising. This is kind of your superpower, which it sounds like is one of a million superpowers that you have, but your latest superpower is the franchising. And so tell me, why did you want to start? I’m also just curious before I ask that question, how many hours a week do you work now?
I work only three hours a day. So my big secret is that even in all seven of our businesses, my husband and I have structured our businesses in such a way that they run 100% without us.
So your numbers are always accounting for the team too.
Exactly. I mean, you can run your business by yourself. It’s amazing if you can, but when you fall ill or you want to go on holiday or something happens in your life and you cannot be at work and your business doesn’t generate money, all your hard work goes down the drain.
I believe a successful business means it does not need YOU to be successful.
You are supposed to be the CEO; the visionary for your business. Come in and motivate your team, your sales people, your consultants, whatever you use in your business, whether that’s one or 400 people. You need to be the leader.
I’ve seen so many beautiful businesses that have potential to grow, but the boss is not being the boss, they’re being an employee. They need to step back and tell them how to think, how to envision and how to be that next level person, because they can’t do that. That’s why we have leaders and followers.
Sometimes it’s a bit more scary to step out of that space, but I believe that if your business is truly successful, it will run the same with or without you.
That takes a technique and a structure and a skill to get it there. But we’ve always built all of our businesses that way. So even today, when I go into the office, I only work four days a week. I go in strategically to meet with some key people. We talk about marketing; marketing’s one of my favorite things, so that’s what I focus on most of my time. Sometimes we do photo shoots, sometimes we do just video content. Sometimes I just sit in client meetings where I’m resourcing new franchisors or its suppliers.
Every day, it’s a little bit different, which is what I love.
Also every day, I get to talk to one of my other businesses. So it’s always different. I just don’t like doing the same thing over and over. On Fridays, I don’t work. And it’s because I structured my business this way.
I also don’t work after one, because I pick my kids up from school, and that’s my life that I structured that way. It did not start out like that, Alison. I used to work 20 hours a day when we started our coffee shop. My feet used to hurt so bad that I couldn’t even feel them. I missed out on my kids for I think eight months of their life. This is not the way I would advise anybody to start a business, but I knew it wasn’t going to be like that forever.
I knew that there would be a small sacrifice for the bigger gain.
When we opened our first coffee shop, we opened three stores in two months, which is also not the norm for when someone starts a business.
I think that’s because I didn’t know what I was getting myself into, which was kind of my baggage. If I knew what I know now, I probably would’ve just done one.
But it was forcing me to think faster. It made me make decisions much faster than overthinking them, which a lot of business owners do for months and months before they just hire the staff or change the supplier. Having the three stores also was strategically planned, because they were all in different areas, attracting different clientele, telling us whether our method, our model was going to work or not.
And after the second month, we were already generating six figures consistently in profit.
And I knew this was a model that was going to work.
After our first year we had five stores, and that’s the point where I said, “Okay, I can’t handle any more stores.” It was way too many hours. We were actually on holiday. I took my first break and I said to my husband, “There must be an easier way for me to keep growing,” because we had so many requests for people to open up more stores in other parts of the country. But I didn’t want to travel and miss out on my kids.
That’s how franchising your business came up.
It was a very scary decision in the beginning, because I was convinced that people would come and steal my formula and my secrets and all of that.
But then I realized I had many women walk into the coffee shop and their entire face, Alison, was just telling me how this is their entire dream come true. This was men and women who have always dreamt of owning a coffee shop, they just didn’t know how to do it.
And now that I was thinking of business franchising, I was actually giving them the opportunity to do it with me, which is another key thing that so many people want when they want to start a business – they just need help. They need to know that they’re not alone, someone is there that can answer the phone if there’s an emergency.
Someone is there just to push them in the right direction, because starting a business is scary and it’s overwhelming. And if you have not got the background of certain technical things, or just how to manage staff or the legal stuff with documents, it’s very scary and it can overwhelm so many people that they end up never starting a business.
So when I could see that these people were coming to us, saying, “Oh, can I have one of your stores? Are you planning on selling them? Have you thought about franchising?” I said to Mahabi, “Okay, let’s do this.”
So we took about nine months to research franchising in general.
I realized that it’s a very corporate model, and people make it very difficult. I thought, I’m going to take a contract, that’s over 120 pages and turn it into like 10 pages because I don’t understand why there needs to be so much of these on a document, and I’m going to just make it simple.
It’s two people going into agreement that we are going to make this business very successful, because that’s what both parties want.
They’re investing a lot of money. It’s my baby that I’m sharing with them, we all want to make this a success. But I was also very clear, again, from the beginning who I want to share this with.
We went through hundreds of interviews for the first couple of people we selected, but we could tell who was only there for the money, who was only there to steal our ideas, who was only there for themselves. And then there were these few men and women in between all of them, who you could see whenever they talk about what their life could look like in five years, the entire room went silent.
You could see that this is truly their dream come true.
And today, I help my clients franchise their own businesses, because I believe whether you have a salon, an accounting firm, a dog pet grooming business, whatever your business is, there are people out there looking at you thinking, “Oh, I wish I could do what she’s doing. If I could get all that support and all that context and just someone to guide me.” And that’s why I believe franchising your own business is a beautiful way, not just to make more money, because you will make more money, but it’s a good way for you to share your business with other people and truly, truly expand your brand.
Franchising Vs. Licensing
I love that. And so do you think that pretty much any business could be franchised?
In my opinion, yes.
I know a lot of people argue with me with this, because if you have an online business, there is a slight difference between licensing and franchising.
But in general, when you have a business that has a structure, you have a formula, a system, of sourcing clients.
You’re giving them something in exchange for their money, whether it’s a product or a service, or a solution. It’s a recurring business, which makes it a little bit easier to continue sales. You could sell that business in a box to someone else in a different town so that they can do exactly what you are doing.
Now, the difference, when licensing comes in, is when you only sell a part or a formula or a technique, it’s not the whole concept. That’s why people can combine it.
There’s a lot of licensing that happens in the beauty industry, for example.
In that case, when there is a specific machine coming in, you’re only buying the license to probably use the machine or the product range, but it doesn’t influence your entire business. You’re just adding more value to it so that you can be associated with that brand. But franchising for me is any business that you can box up and sell to someone else, yes, you can franchise that.
However, franchising is not for everybody.
Franchising is for the business owner who first of all, wants to expand.
So you really want that exposure with multiple locations. You want to attract people that think and want the success like you do, but you also have to be a leader.
That’s scary for a lot of people.
They’re good at doing their job, but they don’t know how to help other people. They don’t know how to motivate them, keep them on track, support them, and teach them. And if you can’t do that, it becomes very hard.
That’s why a lot of franchises are not successful, because people sell off their business and they just expect this new person to really just make it successful. They cannot, if they don’t have the right support or experience. And you, on the other end, you’ve been doing it probably for a couple of years, so a lot of things come more natural to you.
Getting Past the Mental Block of Growth
Today, it’s much easier for my one-on-one clients who have already franchised three or four locations. Now they want to go to 10 or 15, working with me, because I can quickly get them there. They’ve already gone through some of those mental blocks and hurdles.
Others of my clients who just want to open their first or second franchise – that takes a little bit longer, just because the mental block is so big.
A lot of people think that they’re not worth the expansion. They worry that people will think that they’re fake or that they’re not enough, but that’s just all BS, you know? Like I truly relate.
It’s all the same entrepreneur mindset stuff. It’s just that because you’re the franchise owner, you’re also their business coach.
A lot of our listeners are online entrepreneurs. What kinds of online businesses do you think are easiest to franchise? What kind of online business models don’t work for franchising?
When you’re selling products online, it’s a little bit harder to franchise. Today you can find a product online, and it can be shipped pretty much anywhere in the world, unless it’s locally made or it’s very niche to a specific country or a specific person that’s making it.
Let’s say, for example, it’s a shoe business or a handbag business where they make it locally. So you franchise it, but they sell the products only online and not in a store that can be franchised. You have to make sure that those people are aligned with your technique and what you’re doing.
Franchising a Service Based Business
If you’re looking at service based business, for example, take teachers. If someone teaches kids math classes, and have a specific A to Z method to help a grade two child get through grade two, you could formulate a system, and that’s what you could franchise.
Then other teachers across the world can go into your teaching platform and use the same method, which means they don’t need to change anything. They just follow your formula. When you update things, they get the updates. When you add new products, they get to add new products, but they get to sell under the same name. So specifically service based, which is usually things that people don’t think you can franchise, is a very successful franchise model.
We have a lot of it here in South Africa, where at primary schools, they come to provide little services, extra math classes, or they call it soccer stars or play ball. And it’s these interactive stuff with kids. But even if it’s online, like they did in COVID, even that formula still works, that you can franchise it to another person in a different town who can then service all the schools in those areas. And they can become the franchise work for that section.
Oh, that’s so interesting, I love this.
So here’s an example; I think I’m kind of catching on. How about an accounting business? I’m thinking about businesses that are exclusively online, and the difference between licensing and franchising.
So with franchising, everything comes in the box.
From the way we market it to the way we sell it to how we find the solutions, how do we deal with complaints, it’s absolutely everything, the steps from A to Z.
Whereas with licensing, for example, you can have an accounting firm. You might have a specific service inside of your business that you help clients, let’s say, do their taxes that’s very unique. It saves them lots of money. You could license that technique of how you service your clients to other accounting firms. But that accounting firm can still train under their own name. They can still add any other services they want, but they’ve added your licensing, which means your name is connected to their brand.
Franchising an Online Business
If you were a course creator, and you wanted to do a franchise instead of a license, you would basically sell your whole product suite and marketing mechanism to a business owner. But the interesting thing about doing that online only, is that people would have to decide what their dedicated space was, right?
Yeah. The way I would rather do it, for example, I’m a franchise coach and if I would want to franchise my franchising business online, I would have to do it with people that have franchising experience. And the reason for that is because it’s a very skilled knowledge. So you need to look at what it is that you’re coaching people on, and see who could you collaborate with that’s possibly in a different country.
One thing that excites me about my possibility is that I would do it in countries that are connected with foreign languages. That way I can grow my brand, but I don’t have to speak Japanese, etc. I could sell my brand there and still give them A to Z method. So, if you’re like a mindset coach, you have a formula and a system that you’re using to guide your clients. That’s what you do, and that’s what you’re known for. But you probably don’t speak 20 other languages; that could be an idea for you to franchise or license your specific method into 20 different countries.
And a lot of times, Alison, I think people are thinking too small to make a lot of money.
You can think much bigger, and outside the box, and say, “I’m not going to try and find a thousand clients this year. I’m actually going to find only 20 people in 20 different countries to do what I do there in their local language with added value of whatever they do already.”
Mindset coaches are very holistic, and they’re usually very connected to people that are in the health and wellness world. So you can also collaborate with so many people, but now all of a sudden you could have your brand connected in 20 countries expressed in 20 different languages. That is amazing.
A lot of times we don’t think like that, we think, “no, no, we’re going to stay here, we’re going to find a hundred people in our town, or a hundred people in our country.” That’s because we think no one else would maybe want to buy into our idea. And that’s the first mistake that we make.
How Franchisers Get Paid
How do you get paid while franchising your business in a way that makes sense for the owner and also for you?
When you franchise your business, you need to work out the value of the business.
Ask yourself: how much profit are we making every single month, what is it that we sell? What are the pros and cons to the business?
Your profit margins have to be beautifully worked out, so that you can work out the selling price.
So let’s say for example, you would sell your franchise business for $20,000. The idea would be for your investor to see their return on investment. So you need to be able to show them that you’ll be able to make your investment back within a year, two years, five years, whatever that plan is.
You also need to be able to show them how many sales they should be able to make when they generate the business and follow the steps.
An online business is a little harder, sometimes, for people to see the potential that there is compared to a physical business.
With my coffee shops, for example, people can walk into the store, but they’re not sitting there every day, all day to see all the clients that come in – I have to show them the physical numbers. We also base this on whether it’s in a specific location, and whether you do all the steps that’s required to run as successful business.
But that’s pretty much how you get to the pricing part. You get paid for selling the franchise once off. And then there is a small service charge that you can charge every single month. This is where franchising a business becomes a beautiful passive income because every single month, you now have a small amount that’s coming in from each franchisee.
A lot of people make this very complicated – they either will charge a percentage from their profits or a percentage from their turnover. They have marketing percentages.
We don’t do that.
We have a fixed small amount that every franchisee pays us every single month, and that generates by itself, six figures of profit for me every single month.
In franchising, there are many other things that you would generate an income from.
Eventually, you would have merchandise. Your franchisees can sell that as well. You can create additional courses, add a membership – you can have all these things that you add on afterwards. All of those are just additional revenue streams for your franchise. But it starts off with a once off fee that you get them to pay, and then there’s a monthly fee.
Usually the contracts also change from country to country. In South Africa, for example, our franchise contracts are five years. After five years, they need to re-sign to be still conjoined in with you in the contract, otherwise they cannot trade under your name anymore. But that differs from country to country.
How to Get Started Franchising an Existing Business
If somebody wants to get started in franchising, what would your advice be? How does somebody get started?
I would suggest that they go and have a conversation with someone that has the success that you want.
If you can have a cup of coffee with a salon owner who owns five salons, and that’s really your dream and they do everything exactly the way you want it to be – taking them out for coffee is going to be more valuable than anything else.
They will tell you the pros and cons of franchising your business, the mistakes they’ve made, what they love, what they hate, what they wish they did first, and those type of lessons. It’s priceless. That’s what I’ve done many times through the past 14 years. I hang out with people who have more than I have, who’ve accomplished amazing things, not just in money, but in life, because that drives me to reactivate my own belief that I am able to do anything I want to do.
I think that’s where people feel like it’s not possible for them.
They’re looking at people that are maybe too far ahead of the game.
If you’re listening to me and you’re thinking, “Okay, but she’s got 30 stores. There’s no way that I can relate to her. She doesn’t know what it feels like when she has one store,” then I’m not the right person for you. But if you’re listening to me and you’re thinking, “Oh, wow, no, this is me in five years, she did this in five years, I want this in five years,” then I’m the right person for you.
It depends on where you are on your journey, and also on your mental state, on the belief of what you can achieve in your life. If you’re a bit held back, if you really feel like, “Oh, I just want to get my first or my second franchise up,” go and speak to people that have actually franchised their business.
Just be very careful who you choose, because it depends on how successful their business is and how successfully they run their business.
A lot of business owners do things only for the money. There needs to be a bigger reason.
If the money doesn’t show up, they think their business is unsuccessful, which is not the case. It just means that you’re not running it properly. I’ve found business owners who literally were declared bankrupt, make more money in six months than they’ve ever made before. It’s because you need to change the way you do things every day in order to have a different result. And you cannot come in with a mindset that I’m not allowed this, or I cannot reach that kind of success.
Oh, great. Great, great, great. And so tell us, what are you working on now?
Oh, now we’re very excited. So we’re always doing these things, Alison.
Mahabi and I have created 11 income streams over the past 14 years. I’m a big believer in making lots of money. Our coffee shops have grown so big, and our goal is actually to grow to 125 stores in the next four years, we want to move away from being dependent on all of our suppliers and we want to become the main supplier.
We roast tons and tons of coffee every week. So, we want to open our own roastery, which is happening next month. And then we’re also opening our own hub, which is where all the food will be produced. Now, what this means is that I’m taking my business from making millions, literally to making billions.
But what this creates is amazing job opportunities.
I will be able to now serve other hotels, coffee shops, restaurants with items that they’re currently paying way too much money for.
I’m looking at the bigger picture; I want to serve thousands of people, make little bits of profits from each of them, but be able to have a massive impact. I’m not like a lot of suppliers where they want to charge a lot and have less clients.
This is why franchising my business worked really well. I wanted to dominate the market by doing things differently. And that is what we’re doing with our hub and our coffee roastery.
And so how can people find out more about what you’re doing now?
Well, I’m Nicolene Elhadad on all social media. I have a free franchise guide, and we also did a free franchise workshop the other day. It’s just lots of nice content videos to go through and just learn about the possibilities for your beautiful business. They can just reach out to us, NicoleneElhadad.com is my website, and everything is there free resources for them to download.