The Power of Franchising: How to Scale a Service-Based Business

[0:00]  what were those early days like when the phone is ringing and someone says hey I was at kids park I want a kids park to be in my neighborhood do you remember kind of those early moments of like being like well this is what we should do like how was that experience like because that's organic growth which so many entrepreneurs um struggle for but it seemed like it was kind of people were banging down your door saying how do we duplicate this amazing model yeah it was it was really interesting it was very complimentary you know going back to I'm a list maker we had a lot of stuff documented so that part was really good so it was easier to get into the franchise model from that respect I think the hardest part um when doing that kind of thing though is you give out a lot of information before you can

[0:48]  sell a franchise and sometimes you end up giving out information and then they walk away and do it on their own which is fine and you know that's that's business imitation is the biggest form of flattery right I know and I keep telling myself that but you know they make some sometimes there are some changes made and I always question is that really for the betterment of the owner or is it for the betterment of the child and the family and I really would like us to think more about the betterment of the family and the child than just the company especially in child care because you are pay playing a big

[1:49]  role all right guys welcome back to a brand new episode of the heart and hustle podcast today we're going to be having a incredibly important conversation now I have an amazing leader I have a founder here with me today I've got Debbie Milner and we're going to be talking about her inspiration what she started um kids park so Debbie before we kind of dive into today's episode if there was one way and you described yourself that had nothing to do with work how would the individual sitting across this digital table with me be described caring I think people would say she's caring um she do is what she says she's going to do that is an amazing way to be described I hope people describe me in

[2:36]  that same way right he's caring and that he does what he says he's going to do um I'm really excited to be able to dive into today's episode we're going to talk about the origin story of recognizing the problem that kids park is filling we're going to talk about addressing the changing dynamics of family interactions and just how people are supported in today's Community we're going to talk about work life balance we're going to talk about the rise in cost of child care we're also going to talk about early childhood development and so much more so as we kind of get started here I want to have you take a couple seconds and describe your origin story why is kids park something that you thought was so necessary in your life and then what has it turned into here when I was a young mom uh I was living in California uh without any family support no

[3:24]  relatives um my husband was working uh where he traveled almost three three weeks out of the month and I was just at my Wit's End trying to um be a mom work a full-time job take care of a home you know everything everyone else has to juggle uh at the time I was working or I had worked in a field called uh materials management where the focus was get the material there on demand just when you need it I kept thinking wow if only I could have child care on demand when I needed it and that's where the concept began because I felt that if I could have something I could rely on without having to make a phone call I would be better at everything I was doing especially I'd be

[4:14]  better as a mom because I'd be less stressed let's talk about some of those early days because I I love being able to dive into the feelings of those moments so you're an early mom you've got your own little ones you're thinking about how do I show up as the best version for them right when you're balancing life raising your children the stresses of everything else that comes along with that what were some of those early experiences that you had were you frustrated that maybe you just couldn't get the time away do you feel like you couldn't give your kids the attention or do you feel like maybe you were preoccupied if that makes sense doing everything else when you were trying to also be as present as possible as a mom absolutely uh I'm a list person I am always thinking okay these are the things I need to get done this is what um the order I'm going to do them in and

[5:03]  I would be for instance I'd be trying to play a fun version of Candy Land with my daughter but instead of like you say being present I'm thinking about I need to be doing this this and that whereas if it was already done I'd be totally relaxed um and then the frustration of course is when you are trying to coordinate more than two people so um if you can imagine you know you're trying to make a hair appointment or a dentist appointment so first you find out when they're available then you call you know someone to try to help you at home because you certainly are going to take a 2-year-old to uh one of those appointments and then by the time you figure out your arrangements for the sitter you call the person back and that

[5:52]  slot's taken and so you're starting all over again so those are the frustrations what about the early day days of trying to find a solution for this because I know that often the jump doesn't go from I have a problem to I'm going to create something what were those early days like of trying and tribulation and like testing different things out but realizing I'm going to have to create something completely new for myself absolutely I did try um home daycares uh and they're great but they're very scheduled and I didn't have a set schedule so I wanted something where I could drop off perhaps at noon versus at 6:00 in the morning or if I went on vacation or if my daughter was sick not have to pay for services I

[6:40]  didn't use although I understand their model and they certainly deserve it but from a um from my point of view it was um it was a a weigh on the budget let's put it that way and then on the other side I tried um home trying to get someone into my home but again it was a scheduling issue yes I want you this week Monday Wednesday Friday but not next week then I only need Tuesday so that those all became very difficult and I didn't really want to use a um a teenager for one thing they're not available during the day and I also felt that sometimes if I got a teenager I also had to check to see if the parent

[7:28]  was home because if there was a an emergency who who had a car who was going to be able to drive them so um I did try a lot of different things and it just didn't seem to work the bigger problem that I think a lot of people can empathize with I was taken while you were talking there to a story from a couple weeks ago I was going hiking with a couple of my really good friends I was roommates with these guys Dante and his wife Michaela for about six years so we lived together for a long time now when they started building their own family the one thing that they did is they moved to Austin Texas but all of his family is in Southern California and her family is in Oregon Northern California area and the one thing that they said was the biggest mistake that we made was moving away from family because we didn't have any

[8:15]  support and it was so frustrating now why do you feel like so many people have that similar frustration in our com previous conversation we talked about isolation and loneliness so many people move away from their extended family their grandparents their mom their dad and they just don't have that support and it sounds like you came from that similar experience as well absolutely I came from I had had been in the Midwest and came to California with no family but I would go take it even one step further because even if St if you have family in the area the availability of family is different than it used to be I grew up for instance I lived Three Doors Down from my grand grandparents and they were always home there was never a

[9:03]  problem but here even what I've seen is that even if there is family in town parents are working much longer much later than they used to so they're not available during the days people travel people have many outside commitments um so there's not that parent necessarily or friend relative waiting for you at home who can adjust their schedules so there is a sense of loneliness I agree of isolation is uh I isolationism you feel like you really are dependent upon yourself and because of that um there has to be some services around that are totally flexible because you're never going to get everyone on a

[9:52]  eight to a 9 to 5 scheduled Monday through Friday it doesn't exist anymore everything has to change and we talked about that in our previous conversation me being located in Las Vegas Nevada a huge portion of our community works the grave night shift or the graveyard shift from 10 p.m. to 10:00 a.m. or 700 p.m. in healthcare to 7:00 a.m. and you don't have options for child care at that point in time so let's talk a little bit about kids park and what makes kids park so special compared to all the other options that are out there oh many things we definitely do Child Care differently one thing is the hours um before covid we were open 7 days a week till midnight on weekends and 10 p.m.

[10:38]  during the week because we wanted to as you said we wanted to be able to provide child care for Hospitality workers restaurant workers retail workers uh people who went to school in the evening so many things where it's traditional care is really focused on I'm moping at 6 and closing at 6 what do you do if you don't fit that schedule um so that was the first thing we changed the other thing is you pick your schedule you have we have no contract with the parents to come on any day any hour you choose at only pay for the time you use period and then lastly our whole setup looks different in a

[11:26]  traditional Child Care Center you have a classroom of twos a classroom of Threes And that's who you interact with uh during the day our setup is a one room open classroom we accept children from the ages of 2 to 10 or in some centers go up to 12 and they're all in the same room but they are able to choose the activity they are most interested in and just by doing that a lot of times they statisfy by age automatically but the nice thing about it is if you're a three-year-old and your best friend has just turned four you can still play with them they're not moved off to another room and the other thing is if you're uh coming with siblings if you're you're

[12:15]  four and your sibling is six you can be together um and then I also really valued the concept of older children being able to Mentor the little ones it's not going to put them in any kind of uh bullying which you hear about all the time we're finding that the older kids really are wonderful role models they help the kids um set goals now they know I want to be like that when I get older and they learn from them they learn so many things it's like an older brother or older sister um they really help the little ones um develop that was one of my earliest experiences in childh care was me and my sister would go together sometimes and they would always

[13:03]  separate us into separate areas and I remember my sister would be so upset and I would often be upset that I couldn't spend time with my little sister and I didn't really recognize the Dynamics of just trying to compartmentalize different age groups to stop things like bullying or everything else like that but I feel like one of the best opportunities we have is to look up and admire older kids because we like to start thinking about how we can be more like them the things that they do and espe especially when they're nice like so many kids are they start to inspire us at a young age and so I love the model that you guys have kind of implemented one of the things I was going to add is how we use the term bullying one of our teachers I think really States it so well when there is perhaps an issue between kids she'll say are is this person being mean to you

[13:51]  or are they bullying you there's a difference and um most kids don't do it in intentionally uh sometimes you know they're learning to master the language as well so they may be making some mistakes but most kids there we have very little interaction uh based on kids not behaving correctly yeah I mean I feel like it's not in a child's natural nature to bully right I mean I feel like we do a terrible job at labeling children as bullies and we kind of put them in that negative light which comes from a place of judgment and I know when I was growing up it was never my intention nor my friend's intention to ever pick on and be intentionally malicious to somebody else right especially at such a young age exactly it just may be their

[14:40]  communication skills need to be better honed I want to talk a little bit about the early days of you know creating kids park so we find out that we're going to create a business what were those early days like because were there other models that you looked at and you picked and choosed from that said this is what we like what these guys do well we don't don't want to be like that example what was that like stressful it was a lot a lot of research so I did spend I spent almost a year doing research and um part of that time I went to a lot of different uh women's groups family groups uh preschools to see if I can interview people uh I actually I even went to a toy store and stood there um and talked to people to find out you

[15:29]  know what do they want do am I the only one who has this you know this problem or would other people use the service that I was describing and it wasn't until I oh I think I must have gathered about a 100 to 200 surveys that I finally said yeah I think I can make a go of this and and went for it um and then in terms of trying to Envision it it has grown or it has morphed over the years uh it's always been play play based focused uh play focused it's always been one room it's always been a mixture of kids but we brought in different types of play which I think has made it a lot more fun um and my best tester was my my daughter Rita I you I would say do you

[16:21]  like it you don't like it um what do you want uh what do your friends want so I interviewed parents but I spent a lot of time interviewing kids and you'd be amazed at the input you can get back it's like you had your own little incubation Hub kind of built in right you're like does this make sense would you want to do this and then using that as a way to kind of think about it um so now I know that you guys have 20 Plus locations right so you guys have been growing over these years what were those early days of growth like because you had mentioned that you had chosen to go the franchising route and I want to talk a little bit about that why did we choose that rather than you know privately buying up and managing all these different locations yeah so when I first opened I would get phone calls from people who had used us but then

[17:10]  maybe they they were visiting or else they had moved and so they would call and say gosh you know I've used kids park I want one in my neighborhood now how do I do it and it was almost like they expected me to give them the whole outline in 10 minutes on a phone call so once we saw so many people were calling that's when uh when I talked to my board of directors and and they were saying franchising might be approach the reason we chose that was one we I feel that in order to develop um trust is so important in child care in order to develop it I think you get uh you can quickly more quickly establish it with a person who is living in your own

[17:57]  community than to think of a big Corporation that's back out in California we also thought in order to do it well we would have to build in a lot of checkpoints which would mean a very deep organization with regional managers district managers and and everything and I didn't want that big of a corporate structure especially at that time and then the funding to do it would have been huge so decided to go the franchise route and I I've been amazed my the biggest surprise to me was how much I enjoyed the mentoring of other business owners the training of new owners I never I didn't know that was going to be as enjoyable as it has been what were those early days like when the

[18:44]  phone is ringing and someone says hey I was at kids park I want a kids park to be in my neighborhood do you remember kind of those early moments of like being like well this is what we should do like how was that experience like because that's organic growth which so many entrepreneurs um struggle for but it seemed like it was kind of people were banging down your door saying how do we duplicate this amazing model yeah it was it was really interesting it was very complimentary um and I think for the most part it was great uh luckily you know going back to I'm a list maker we had a lot of stuff documented so that part was really good so it was easier to get into to the franchise model from that respect I think the hardest part um when doing

[19:34]  that kind of thing though is you give out a lot of information before you can sell a franchise and sometimes you end up giving out information and then they walk away and do it on their own which is fine and you know that's that's business imitation is the biggest form of flattery right I know and I keep telling myself that but you know they make some sometimes there are some changes made and I always question is that really for the betterment of the owner or is it for the betterment of the child and the family and I really would like us to think more about the betterment of the family and the child than just the company especially in

[20:21]  child care because you are pay playing a big role I mean there's a lot of conversations today um especially that I'm having here on the podcast about early childhood development and how important it is to have your child in a safe trusted cultivating environment that allows for them to continue to grow so why do you think and I don't want to point fingers here but why do you think so many business owners make decisions to I would say benefit the owner of the business instead of the customer that they're serving I think there's a lot of forces in play uh especially in this type of economy where where people have to pinch pennies and uh try to figure out how do you cope with inflation how do you cope with all the regulation change changes and and for us uh a lot

[21:10]  of the time it's having to cope with the change in how people spend their time so for kids park for instance we were one of the primary reasons we were we were needed was for people to keep appointments run errands attend school well they can attend night school or even Day School a lot of courses are offered online so you're not leaving home um a lot of people aren't running their errands in town they're buying stuff online you don't need help with that um they're not going out to dinner as often because of inflation so all the occasions that for kids park we relied on customers

[21:59]  they're not coming as often and so then you have to look at the whole uh utilization of your center to see how can you fill it or how can you better manage all the costs the other thing that has made people um really focus in on what's better for them is that so much a lot of child care in many states is being taken over by the public schools so where you originally had a business planned for a infant to 5-year-old market now you're being asked to do the same amount of business but you only have uh infants to three-year-olds So you you're losing a large segment of the market and I think

[22:46]  because of those tensions uh they do sometimes have to put themselves first um although I still think most centers are doing a phenomenal job dealing with families and kids but I think that's one those are some of the reasons why the stresses have been made them to really look uh at themselves first yeah and I think that you know that is one of the quickest ways to build a business but is that the quickest way to create sustainability or the best way to create sustainability I'm not really sure it is right no I think in order for it to be sustainable I think these are things that you have to look at well then what can it's going back to your original business model

[23:34]  what can you provide that still isn't being provided what can you enlarge upon um a lot of it though is going to take uh educating the public so that they can see the benefits for for using a service and I I think because we are a regulated industry there has to be a more vocal and organized feedback to government about some of their plans and how they are uh enacting them that was a an area of discussion that I know you want to dive into as I was looking at my notes for today's conversation you talked about the regulations the policies if you will in the child care space need to adapt and need to be changed what are some of the biggest things that we're fighting against in this space that's kind of stopping other

[24:21]  people from creating their version of kids park or like what are some of the societal factors that we're rubbing against well the regulations really haven't been updated since the 50s okay mom and dad you know two parents two kids living in Suburbia um and it's it's just so different it we need regulations that take in consideration the whole family um there's a lot of attention to um being very specific on who you can hire which I which in all states but some states are better than others um I would hope that government or or States would give

[25:12]  the owners more credit or more flexibility to hire people that they can trust and that can bring value to the kids right now they are very specific on some early childhood education which obviously is needed but how about bringing in art teachers music teachers how about bringing in even coding for little kids you know none of this stuff none of these people are going to have ECE and so why can't we have them supervise without and having being able to be counted in ratio uh which is something that child care centers need um and making it easier to do it um so that we can really bring enrichment into

[25:59]  the center um I always laugh you know you can have have a high school education know how to code you can be hired to code make $100,000 or more a year but that same person can't watch six children for you know an hourly wage makes no sense does it and this person may have worked in summer camp they may have um volunteered with different um groups Community groups and you just meet this person and you know they'd be phenomenal but they can't work for the children doesn't matter if they're finger printed or whatever they I mean they could work with children but

[26:48]  they would have such a low um ratio that what you paid that person you couldn't get back from a business standpoint so so that makes no sense it seems like we're stuck in the mindset of the 50s right I mean there's a certain amount of people or a certain demographic or Target Avatar if you will people who can look after our children but that's that really doesn't lean into the idea of creativity of curiosity because the way in which children are influenced today is completely different I mean even for when I was born in 1990 now kids are given iPads as an example they say hey just look at this iPad and so I would love for them to have early exposure to people who can code and treat them how to do or teach them how to do certain things that would turn into skill sets that they could leverage

[27:36]  later in life like what an amazing exposure process for these kiddos now with all the challenges that we talk about here Debbie why didn't you guys choose to say kids park you're going to sign a long contract you're going to be locked into a certain amount of hours per month whether you use them or not you're paying for this time like many other organizations do why didn't you choose to go that path I put myself in as the customer and I don't want to do it I didn't I did not want to be um locked in because I wanted flexibility which I think most people want nowadays more than anything is flexibility so because I didn't want it I figured other people wouldn't want it and I didn't want to have to manage it

[28:23]  um so and then the other side of it was when I was trying to figure it out knowing that hourly care is going to need a large database of people cuz I'm imagining not everyone's going to come the same day if we started to lock them into contracts it was the operational side of well then how many seats do you keep open for drop-ins because the worst possible thing with the drop in is to turn anybody away they're coming because they need you so you don't want to have to say sorry we're full we want to be available I mean you're just you're empathizing for your customer I mean this was your lived experience this was something that you truly thought of this

[29:12]  is the pain point that you identified I feel like you've been doing right by your end customer this entire journey and that's why you guys have been able to grow and be successful now there's one other thing that I want to talk about which is the element of there are fewer and fewer people today and which we kind of touched on who are getting into the child care and early development space so why do you think we're seeing those macro problems for the amount of people that we can hire and then how are you guys doing things differently to meet that demand and that need I think there are a couple of things that played into that um first of all I do think it's the regulations so in California for instance they specifically say that if you're going to work in child care you need these 12 College units

[29:58]  as soon as you say that's what you needed you've almost created a union uh pay pay scale if everyone has the same credentials well then everyone should be paid the same if uh someone comes in with greater um training of course is going to bring more to it um yes they're going to get paid more but it's almost like they have set a standard if all you need is 12 that's all you're going to get um people who are who may not be choosing this career even though they enjoy children probably are doing it because of the pay pay scale I would imagine but if we could open up that pay which we have uh

[30:49]  child care workers in most areas the pay has gone up 28 to 30% over just uh the last couple years um and many times you can get um you know depending on the center you may be able to bring your child to work with you which we think is the best thing I mean if you have your child there you know it's going to be a very high quality program um so I think it's the pay I think it's availability of classes also as soon as they say you must have these classes there's people who are going to line up to take those classes but they may not be able to accommodate all the people who want to so if you are looking for a job or if you're interested in in

[31:40]  going on for additional classes and you can't get the classes you want pretty soon you're going to change your mind and try a different field um many states have changed from saying you need these classes before you are hired to saying You must continue New Year education and take X number of units over the next few years I my hats off to those States who recognize what needs to be done to keep the field um to keep teachers in the field one thing that I know is that you said very early on in the process of building kids park you made a very conscience decision to ask a really important question when do you want to work why

[32:28]  did you ask that question and what has the impact on that been that has been our model from from the beginning you're right um I think it has kept our staff engaged uh we typic and right now we have staff who've been with us for over 30 years uh we yeah and our average teachers I think have been with us now eight eight or nine years um and that's because I wanted to recognize the whole person when we hired them um I had an had an occasion when I was in a a grocery once I was in in the checkout lane and the checkers are calling back and forth

[33:15]  saying can you take my Tuesday I'll swap my Saturday all every they were remaking the schedule that had been handed to him because it was almost like the management hadn't taken into consideration that people have a life outside of work and I thought well that's crazy when I put a schedule together it's because I know these staff work well I know we'll have a great mix of talent in this shift whereas if they start scheduling themselves who knows what we're going to end up with so um from the very start we always asked uh we did this three times a year to coordinate with the school schedules when did you want to work when are you available and If you tell me and tell me how many hours you want a week that's

[34:04]  what we're going to give you and then no excuse for not coming I of course there's you know sickness and all but you know for the most part people show up um you know the mom might want to work days while her kids's in school but come summer maybe she wants to um work evenings instead and be home for the kids maybe the college student is um done with classes during the day so she wants to work nights or maybe she goes to night school and she wants to work days who knows but we always try to take in consideration the whole person and then we do encourage them to bring children to work with them I want to talk a little bit about the mindset of being an entrepreneur and being a Founder so one thing that I realize is

[34:52]  you guys have been in business for quite some time now this journey has had I'm sure it's mountaintops and its deep valys how have you kept your mindset in the place of gratitude and appreciation for what you've created over all these years you're right it's been a roller coaster sometimes and you know with anything that you stick with or or anything um you know life there's ups and downs for me I will the best way for me to get recharged is to go to the center um and work the front desk because I know that within three or four check-ins or checkouts I'm going to have a mom or dad say I don't know what I would have done without you today I just don't know

[35:41]  you know I've had you know whatever the reason my be family occasion work work occasion whatever you know I was lost I really needed you and you and that that helps and I think that was probably true for all our staff um Everyone likes to feel like they're providing a service and we even use those words all the time um you know welcome to Kids Park or whatever you know we may say but we always add to it we hope we can be of service man when I think about just the the trust that you've been able to build with the brand of kids park families know that they can come to you at a moment's notice and take advantage of

[36:28]  something like a opened up doctor's appointment or an appointment that they had to be at that's in itself that flexibility I feel like is so beautiful you know one of the things that I often talk about is in the world of Entrepreneurship the only objective is not to make money right but it's to continue to keep playing the game what would a piece of advice be that you have to somebody else who was trying to be in your space who's just in the early stages of you back in the day when you realized that there was an opportunity for you to create a solution to a problem that you were living in what would you tell them I always think you it kind of goes back to what you said too put yourself in the customer's shoes first then see how it works on the business side uh to create a business and then force a customer doesn't work

[37:19]  you can't change that um I I truly believe you have to look at what's missing in the marketplace um and set their rules based on what how they want to be treated you know going back to I don't want to impose a contract on you I want you to I want it to be flexible but that's me so you know I think for whatever business and whatever person they have to look at what it is they want as a customer I have uh as we kind of land the plane here in our episode I just want to say thank you for everything that you've done over all these years to support the community of our family and when I say the community of our family it is not just us individually with Mom Dad kiddos

[38:08]  or even grandparents but it takes a community or a village to truly raise a little one and you've been a perfect exemplification of exactly why that is and the services that you guys deliver and offer to the community are so so very important so for everybody who's watching and listening Debbie seriously kids park have to go check them out one my final things that I want to say here is that our previous guest wanted to ask you a question now as a entrepreneur and as a leader this is a really important one who encourages you as a leader when you feel a little down or maybe you just don't have that extra zip in your step because often we spend so much time encouraging and uplifting the people who we employ and everybody else around us but often we don't get it so who encourages you when you really need it

[38:56]  that is a very very good question I I'd have to say I I'm very fortunate I have a very very close very good relationship with my daughter who is actually work is in um business herself and she's a great sounding board and uh she's able you know I get so close to it I'm it's very beneficial for me to talk to her because she can see the bigger picture sometimes so I would definitely say that she is um a huge huge support well I want you to know that you can always count on me as well you know part of why you do part of part of why we do this though is you know everybody who

[39:43]  comes on the heart and hustle podcast is that exemplification of that intersection of heart and hustle and the one thing that I recognize is that doing what we do as leaders and encouraging others and pouring into other people all day is not an easy task and I think that we need to talk a little bit more about how we get encouragement at the end of the day because the stresses the challenges the navigating the big problems it weighs heavy and when we don't have a community of people who are willing to say Debbie we are so proud of you for everything that you've accomplished over all these years in business all of the lives that you've impacted all the families who you've helped and the people who have literally called you since day one and said how do I get a kids park in my neighborhood those are people who have such gratitude for you being able to lean into those

[40:30]  feelings of fear maybe the feelings of uncertainty when this first started and you said I'm going to create my own thing and I know that everybody who's watching and listening today is incredibly proud of you for everything that you've accomplished so I just want to say thank you so much for coming on the show we really appreciate it thank you guys that's been another episode of the heart and hustle podcast that's the Pod there we go take you in the next one