What's a common trait many successful people have? Adam Povlitz, CEO and President of Anago, joins Joel and shares what he believes it to be! He discusses the unique business model of Anago, making friends with frontline employees, and what he believes would make the world a little bit better. Check it out now in our fifth episode!
Tell us about you.
My wife appreciates when we meet new people and they ask what I do, and I go, I'm a janitor. Nobody says I want to be a janitor when I grow up. It's something that doesn't have that sexy ring to it. It's an industry that's often overlooked & under-appreciated but at the same time, when you look at the revenue opportunity, your eyes open really wide. It's a great industry to be in especially now. It's booming frankly.
It seems like you've figured out your model pretty well, can you explain it to us?
Unlike traditional franchising that most people think of, a two-tier system, ours is a little bit different, it's a three-tier model. There's the corporate office, then we have a master franchise, then we also have a unit franchise. The easiest way to think about it a master franchise handles the day-to-day operations, the daily operations of the cleaning business, where the unit franchise handles the evening portion of the cleaning business. Cleaning is a 24/7 type operation. When most people think cleaning they go, mop and bucket or cleaning part, it's a very profitable piece, done after hours. The unit franchise learned how to run the traditional style cleaning business, they understand the equipment & chemicals, they recruit the employees & train them on how to do the cleaning. During the day, where did they get that client from, and how did that client get invoiced and how did they get collected from? In order to create this really great synergy, we were able to split the day and night time aspects so that the master franchise handles the sales, marketing, day-time customer service, and some of the financial invoicing so the unit is able to focus strictly on the cleaning. The master franchise ultimately saves because they are not spending this huge resource of time on labor or worrying about the concerns of hiring and training, they are focused on sales. It really pairs the two together in a unique way that other industries are not using.
Do you have owners who are both unit and master?
Typically no, that's very uncommon, we've had some master franchises that own a unit initially in addition to their master franchise. It's very different specialization and very different investment points.
Where did this model come from?
Even though we are a 32-year-old business, we're not the first in this space. The first is Jani-King. They are the McDonalds of our industry. My father who founded the company, he owned a traditional cleaning company back when I was a little guy, and we moved to Florida and he worked for Jani-King back in 1989. He saw how their model worked and said I can do this better.
Growing up in the business, I can imagine it wasn't glitz and glam, tell us about some of the things you learned in the process of working your way through the company.
I actually never intended to be a part of the family business. I think I worked 1 summer when I was in high school at the local master franchise. I was an inspector. I would go and inspect how clean the buildings were and we always did inspections and performance evaluations so you're able to see both sides. Hopefully, I'd see an issue before the client. That was the last time I was with the company, 2002, until 2009. I got my MBA concentrated on finance, worked at IBM. The short version is I joined in 2009 after leaving IBM and my Dad said ok, you've left your job and your first job here will be a telemarketer by day and a franchisees assistant at night cleaning a daycare.
How has doing the job, changed how you treat your employees?
We have a corporate staff here, of under 50. My dad always said successful people do what unsuccessful people are unwilling to do. It really is. It's not a glamorous industry but tell that to the owner of waste management. It's a filthy industry but when you say you're willing to roll your sleeves up and do something other people didn't think was sexy or cool, there's a lot of money to be made in these off-beaten industries. When I work with my employees, I take that mentality into it as well. Not every job is going to be the coolest, it's tough now with the Millennial Generation and Gen-Z; everyone is looking for that quick hit, I want to change the world.
How do you stay in communication with the frontline and stay on top of the issues?
It's definitely a tall task. It comes down to training, you have to focus on training and making sure they know they don't work for you, you work for them. You have to focus on the training. It's also the technology. The app I was telling you about, allows for that instant communication. The biggest breakdown in commercial cleaning is a lack of communication. It's a business where you hear a lot of negatives, we've taken it upon ourselves, if that's what our frontline is faced with, how do we spin that and use that opportunity to make a friend? Our technology, Clean Comm, if you have an issue, you take a picture and put a note and sends it to the franchise owner and they are able to send messages back.
What's your big goal for 2022?
Last summer, we ran the numbers of 2020 and we were just about $70 million in recurring janitorial contracts. I issued what we're calling the $100 million challenge to our master franchisees and had them issued the same to the unit franchisees. It says, I want as a system for us to have $100 million in recurring revenue within 24 months of the challenge. We had a 5 prong plan behind it and some is more technical to our industry.
What's something you believe, that if everyone believed, would make the world better?
I would have to defer to our first of our seven unifying principles of Anago: Believe in people.
What it really means is, believe that deep down in the core of someone's being that people are good people. They are good-intentioned, we're all just trying to have our families and live our lives and enjoy life. People make mistakes and say stupid things, but if we all stopped and believed in the person and asked if it was their intention, we'd all be better off and happier.