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Blueprint For Profit

[ 0 ] Aug. 1, 2007 | SBO Editor

Successful companies have an almost Zen-like quest for perfection. Motorola pioneered Six Sygma, the quality improvement process that strives for producing error-free products 99.9997 percent of the time. The Ritz-Carlton hotel chain is legendary for providing 120 hours of training per employee, per year, helping ensure its guests enjoy the experience of a lifetime.

Entrepreneur Todd Beckman is no different. He insists customers be greeted within three seconds of arrival. Employees are empowered to “own” customer concerns and see them through until resolution. Every customer experience is expected to exceed expectations, says the founder.

But Beckman is in an industry where you normally wouldn’t expect to find such an extraordinary commitment to excellence. That’s all right, because Beckman’s formula for combining world-class facilities, state-of-the-art equipment and outstanding training and customer service with a passion for perfection has positioned The Tan Company as one of the fastest-growing tanning salon franchises in the nation. Business is booming.

With 72 locations in 12 states, The Tan Company expects to grow to 100 locations by the end of 2007 and reach 500 salons within five years. Beckman is considered one of the industry’s pioneers since opening what was formerly called The St. Louis Tan Company in 1994. He is a visionary.

Beckman was one of the first to combine the superstore concept—dozens of tanning beds providing multiple levels of tanning—with an economical membership program that provided unlimited tanning to customers instead of paying per visit.

Along the way, Beckman has fostered The Tan Company brand—recognized for its “Five-Star” facilities, world-class skin-care products and cleanest tanning environment in the country—making it a premier investment opportunity for single- and multi-unit ownership and area development.

“I saw the unprofessionalism in the tanning industry,” Beckman said. “There was not a dominant brand with first-rate facilities and service. Most were run like mom-and-pop businesses. I felt we had a unique idea.”

Beckman got his first job bussing tables when he was 13. His parents, Ed and Gay Beckman, owned several hair salons in the St. Louis area. Todd opened his franchised hair salon in 1984 when he was only 18.

Two years later, Beckman put four tanning beds in the back of his salon. They were immensely popular. It convinced Beckman to buy a small tanning salon in suburban St. Louis in 1994 that had sales of $65,000 in its first year under previous ownership. Beckman’s St. Louis Tan Company—with its innovative membershipprogram—had sales of $57,000 in its first month alone.

Even with two locations, customers were sometimes waiting 90 minutes for a tanning bed. Nine months later, Beckman opened his first superstore in Maryland Heights, Mo., with 30 tanning beds providing multiple levels oftanning. “We’ve been building off it ever since,” Beckman said.

The St. Louis Tan Company grew to 15 locations by 2000. With growing demand for the superstore concept and ever-increasing customer traffic, Beckman decided to franchise his business model and expand outside the St. Louis area in 2001 as The Tan Company. Today, superstores with 20-plus beds and five levels of tanning account for 90 percent of The Tan Co. locations.

“It took someone with an entrepreneur’s attitude like Todd to see the potential in building a brand when there were so many others entering the industry who only wanted to open a small salon,” said Todd Layton, vice president of franchise operations. “Unless you were willing to make a commitment to be the best, as Todd did, it wasn’t going to work.”

Beckman’s business prowess has caught the attention of others, namely Dave “Lags” Lageschulte, who became the first franchisee of the popular Hooters restaurant chain in 1983. Along with his partners, Lageschulte developed Hooters restaurants throughout South Florida and became one of the chain’s most successful franchisees. He is co-owner of the world’s first Hooters Casino Hotel that opened in Las Vegas in February 2006.

In January 2006, Lageschulte purchased a 50 percent ownership stake in The Tan Co., as well as area development rights to Georgia, Virginia, Florida, North Carolina and South Carolina. His first location opened in Athens, Ga.

Lageschulte’s involvement not only gives The Tan Co. the financial backing that makes it one of the strongest companies in its industry, but also an expertise in franchising and branding that is invaluable to the company’sfuture growth.

The Tan Co.’s corporate team is literally hands-on when it imparts the importance of brand building to its franchisees. Four members of the corporate staff are involved as owners of 30 of The Tan Co.’s 72 locations.

The Tan Co. offers two salon models: a small store with 12 beds and the superstore featuring 20-plus beds. Both concepts offer five levels of tanning and Mystic Tan sunless tanning.

The initial investment is between $250,000 and $500,000 depending on the model. Small salons average 1,400 square feet in size while the superstores can reach 2,800 square feet. Beckman has commitments from area developers for more than 60 locations.

“In many ways, the tanning industry is still in the mom-and-pop stage,” Beckman said. “Becoming a Tan Co. franchisee means getting involved with a company that is going to be nationally known in the next five years. It’s similar to becoming a McDonald’s franchisee when it had only 70 restaurants.”

With more than two decades of industry experience, Beckman says it is fitting that The Tan Co. is on the fastest growth pace in the company’s history.

“Franchisees are investing in our system,” Beckman said. “Anybody can buy a tanning bed and put it in a store. But we have been perfecting this system for 20 years. It’s an impeccable system that works if you follow it. Now we want to take the best system in the industry and turn it into a nationally known brand.”

Todd Beckman said his franchise is attracting franchisees who are organized, entrepreneurial, hard-working and committed. The Tan Co. recently introduced an online interactive training center that provides the most advanced interactive training and testing available today.

Category: Get Rich at Home, Get Rich At Home 2007, Magazine