For Fantastic Sam's, the kingpin of hair care franchising in the
United States, Oklahoma has proven a more difficult nut to crack than
Japan, according to Sam Ross, founder of the dynamic hair care unit.
Ross's SMR Enterprises Inc. of Memphis, Tenn., set its sights in
1985 on Japan and Oklahoma for expansion of its Fantastic Sam's
franchise network, he said during a visit to Oklahoma City on Monday.
Since opening in 1972, Fantastic Sam's has grown from one store in
Memphis to 733 stores (21 company-owned) in 35 states and two
Canadian providences, making it the largest and fastest growing
haircare company in the business, Ross said.
Each week an average of five new Fantastic Sam's franchises are
purchased at $20,000, while three new stores are opened.
The reason behind its growth is clear, Ross said.
The majority of stores in the $15 billion American hair care
market are ""mom and pop'' operations. Fantastic Sam's offers a
disciplined system to hair care that allows franchises to average
over $200,000 annual revenue in towns as small as 4,000 population,
""We're the only ones that have taken the time to develop a system
in the hair business,'' Ross said with pride.
""The most important number on Fantastic Sam's,'' he added, ""is
that 87.6 percent of our customers are repeat customers, and we have
that on computer to prove it. The norm is 49 percent. So as long as
that continues to go up, I'm not going to dispute it.''
Fantastic Sam's operating system, furthermore, garners 17 percent
gross profit for each of its stores, Ross boasted. Franchise success
subsequently led to SMR revenue of $48 million in 1984.
Through SMR's Oklahoma regional office, Palm-Walk, Limited at 419
N. Meridian Ave., three Fantastic Sam's franchises have been opened
in the Oklahoma City metropolitan area since August, 1984.
Through the next 12 months, Palm-Walk owner Joan P. Walker
anticipates an additional 17 metro franchises will to join the fray,
along with 20 more in Tulsa.
Yet despite the firm's growth, few metro citizens have heard of
Fantastic Sam's unique ""family haircutters'' approach. Ross blamed
the awareness problem on a lack of local television advertising,which
has left an undefined image with the firm.
""Oklahoma has been a little bit tougher market to crack than
normal due to the fact that we have had the obstacle of proving
ourselves,'' Ross said. ""We had to prove that we weren't in here
He expects increased advertising to gather more Sooner interest as
the Oklahoma region grows, thereby multiplying its effects.
Ironically, Ross encountered no such problems in his Japanese
exploits. Just before coming to Oklahoma City, Ross completed a
contract with Nippon Braintrust Inc. …