Wanting Is Not Having: The Owner's Trap

This is a transcript from Episode 60 of The Franchise Champion Show. Listen to the full episode on Apple Podcasts, Spotify, or YouTube.

Alan Regala: My guest today isn't a franchise owner, and that's exactly why I wanted him here. He works with owners who have become the bottleneck in their own business, and he created The Inquiry Method to help them get out of the way. Kyle Mercer, welcome to the show.

Kyle Mercer: Thank you. Really great to be here, Alan.

Alan Regala: So take us back to the beginning, or at least before what you're doing now. Maybe not all the way. What did your work look like before The Inquiry Method existed?

Kyle Mercer: Oh, wow. Before The Inquiry Method? Well, I was kind of objectively a bum. A productive bum. I worked at a ski area, I've been a carpenter, and I was a building maintenance man at the ski resort. And it was a really great time. I saved up some money, I bought five acres of land on Baldy Mountain, built a little cabin out of recycled materials, and just lived up there and picked berries and hung out with the bears and a moose.

Alan Regala: That sounds incredible. Holy cow.

Kyle Mercer: It was.

Alan Regala: That's kind of crazy.

Kyle Mercer: But what happened is my partner got pregnant, and I decided to be a dad. And I decided that running water would be important, and electricity just as a convenience.

Alan Regala: Yeah, that makes sense.

Kyle Mercer: I thought, I should make some money. And that's where it all began.

Alan Regala: Okay, so this is not everyone's story. It's very unique. That was a good realization you had, and I'm sure your kid or kids appreciate that. So what happens when you decide to make money?

Kyle Mercer: Well, I think it is an intent. I was very into being content without money, but I just said, yeah, I'd like to make some money. And so things just started to catalyze. I'm a teacher, I have a degree in education, so I started teaching. But it was a school for troubled kids, and after about three weeks they came up to me and said, "Mr. Mercer, we can see you really care about history and this stuff, and you really want us to learn stuff and have a good time. But we're not like that. You're in the wrong place, man. We're never going to make it easy and we're never going to be interested. Otherwise, we wouldn't be in this stupid school."

Alan Regala: Wow.

Kyle Mercer: And so I decided that I was never going to teach anybody that didn't want to hear what I had to say ever again. So that was another transition. Life gives us all sorts of messages about what you should or shouldn't be doing. So if all the messages are pointing to "this is not the right thing for you," it's time to adjust, if we can really listen.

Alan Regala: Yeah, that makes sense. I can appreciate hearing what the universe is telling you, listening, and changing direction when it's needed. So what do you do after teaching? Where does that take you?

Kyle Mercer: Well, my dad is kind of famous for Mercer Advisors. He was a consultant to dentists and doctors and entrepreneurs, built a really famous business, then sold that business and became a philosopher. And he came to me and said, "Kyle, my business just isn't working. I've hired all these managers and I don't want to manage. Why don't you just come in and manage?" He actually gave me the business and said he'd work for me. He said it was making $250,000 a year, which wasn't enough, and if I failed at it, that was fine, he'd go do something else. But if I could make it work, we'd both prosper. And I just happened to be good at it. In four years, we were at $2.5 million.

It was really just coming in and aligning, and relying on the customer base that he had developed. And then after that, he had an accident. So I just started teaching. I was doing 18 seminars a year all over the country, 40 or 50 people for five days. As soon as he had his accident, I took it all over, and everybody just adopted me as the new teacher. And I'm extremely good at it.

Alan Regala: That's great. So tell me, what exactly was the work that you were doing? What is it that you're teaching?

Kyle Mercer: It's evolved over the years. I've grown so much over that time, but it's really about finding where the obstacle lies. I call it the point of contraction. Every system, every business, every relationship, every person has a current point of contraction, and that's where the energy is blocked.

So if my point of contraction is an emotional issue that I just can't get past, it doesn't matter how many new ideas I have. I only have so much energy that can go through that emotional issue. So we have to identify the point of contraction. Same in a business. If you've got production and sales and all this, it doesn't matter how much you work at sales if you can't do production. Every business has a point of contraction, and oftentimes it's the leadership, but we'll get to that more.

So I just ask, where's the point of contraction? And then we address that. It doesn't matter if it's a relationship, a business, wherever. If we can identify the point of contraction, we can release it. When most people start with me, the first thing we do is clean up the emotional field, because oftentimes they're carrying things from the past, from childhood, all that kind of stuff. People come to me and say, "The Inquiry Method, this is great. Fifteen years of therapy and you fixed it all in 30 minutes."

When we really know how to identify it and clear it out, it doesn't have to be a lot of talk. So we get the emotional basis set. Then it's beliefs, ideas, and views I've inherited, either from the world or from family or advisors or whatever. We clear up all that stuff so that somebody can really connect to who they are and what they want to do. Just like that kid helped me with my point of contraction and said, "Mr. Mercer, this isn't the place for you." I said, thanks, I'm really knocking my head against the wall here.

Alan Regala: Okay. So for someone who's never heard of it, I want you to give me the 30-second elevator pitch for The Inquiry Method.

Kyle Mercer: Okay. The Inquiry Method is incredibly stupid and simple. I basically help you by being curious about what it's like to be you, and help you come to your own realizations about the things that are holding you back. Everybody has all their own answers. All the advisors out there are like hammers for whatever their thing is, and they want to pound the nail in. Almost everybody that has a philosophy will put you into their framework and tell you to do what they want you to do.

And I'm the opposite. I ask a lot of questions. I understand deeply what it's like to be you, and in that process, you discover what it's like to be you. And then I say, well, how do we set it up so you can be more like you? And that's really what leads to success.

Alan Regala: Yeah. I have to imagine people are just speaking out loud while you're asking the right questions, which I think is such an underrated skill. Someone answers and gives you the information, but at the same time they're realizing things themselves just by saying it out loud, because maybe they'd never been asked the question, or never been asked it that way, and they learn so much on their own just by saying it out loud.

Kyle Mercer: There's actually a little different dynamic, and this is the tricky part. I call what's in here majority consciousness. My brain is operating on everything I've ever heard about life, about business, about money, and even about myself. So as I go along, I make up a story about myself. And mostly when we're asking people questions, they're giving back the story they've already made up about themselves.

So we have to create an incredibly safe environment, and then I have to ask a question that surprises the brain, because the brain's already coped with everything. We have to tap into our source with a question I haven't already formed an answer to, to find what's really true for me. And the way that works when I work with people is they just become more like themselves, less programmed and less adapted to everybody else's expectations. It's like finding the real heart of myself.

Most entrepreneurs are like that. Most entrepreneurs are inspired, and they inspire other people. But over time it gets worn away. They start adapting to other people's expectations, to advisors, to all this stuff, and they lose that spark and start to die a little bit. So finding that point of inspiration, that aliveness, that energy to create, and reconnecting with that is what really leads to success. When I'm coming from that inner inspiration, not the have-to, ought-to kind of thing.

Alan Regala: Yeah, I love that. That's really great. So let's talk about the kind of people you typically work with. It sounds like business owners, entrepreneurs, executives. Are these the kinds of people you work with?

Kyle Mercer: Truthfully, over the last 30 years, I've worked with every single kind of person. This is a panacea, a cure for everything. Although I really enjoy working with entrepreneurs and people who are interested in creating an amazing life, and generally we find that in business people, people who are standing on their own feet, not just working for somebody else.

So I really love entrepreneurial kinds of people. Like I read in your description, people who really want to create an amazing life for themselves. But to do that, we have to get through the obstacles and the contractions within ourselves. It's a much more subtle aspect of it. The practical things, it's super great to get support and advice out there. And then we also have to check in with the inner game, what's going on inside my system.

Alan Regala: Yeah. So a lot of the people listening to this are aspiring business owners or franchise owners. Maybe they already have a business, maybe they already have a franchise, and they're just trying to figure out how to do better in whatever it is that they're doing. And how you describe your process sounds a bit different than a typical business coach, for example. Starting with the emotional side of things, I could see being a little out of the ordinary, and I could see some resistance.

Kyle Mercer: Oh, you nailed it.

Alan Regala: How do you encounter that, and how do you get over that hump?

Kyle Mercer: The way I get over that hump with my clients is usually they're in so much pain or frustration that nothing else is working. So they say, well, at least I'll try something else. And then they go, "This is the best thing." And then what happens is somebody else will see them and say, "You are a totally different person." It's kind of the When Harry Met Sally thing, like, I'll have some of what you're having. Where did you get that? Because they're just light and bright and engaged.

So a lot of it comes from either somebody being in so much pain they've got to do something different, or they see the difference in somebody else and say, I want some of what they're having. That's the number one way people come to me. They either see the difference in somebody else, or they're just hurting too bad.

But I will tell you, another way people get to me is when you're advising your business people, sometimes you say, "I keep telling you to do this thing, and you're not doing it." We know what we're supposed to be doing, but we're not doing it. And so I can really free up the underpinnings, so then they can take a system, apply it, and get great results. One of the ways you can tell it's somebody's underpinnings is that they know what they need to be doing, they know how to create success, but they keep shooting themselves in the foot or repeating the same pattern over and over again. If we get to those underpinnings, then all of a sudden they're free to do what's in their best interest again.

Alan Regala: Okay. So I would love to hear how you go about doing that, because I think that's probably true for a lot of people, like you said. Hey, I know what I'm supposed to be doing, but for whatever reason, I just can't bring myself to do it. So what's that process look like? How do you identify that block and help them get it out of the way?

Kyle Mercer: Do you want to play dialogue with it?

Alan Regala: Sure, sure.

Kyle Mercer: Okay. So you be one of your clients, and bring me something.

Alan Regala: All right, let's see. I've got some tasks that I'm doing. Let's say I'm kind of in the middle of operations, doing some of the tasks that ideally I would like other people to do. But I'm in the business. Let's say I'm partly helping install some widgets or whatever it is, and maybe I've got someone else who's helping me too, but I'm in it as well. And because I'm so busy and things are going really well, I'm in it and I don't have the time to focus on hiring or doing other things like that, or writing the documentation that needs to get written to train someone else to do this task. I know it should be done, but it's fine. I'm in it and I'm just too busy.

Kyle Mercer: I see. Too busy. And what are you too busy with?

Alan Regala: Doing the tasks. I'm in it and working with customers. I'm helping them out, fighting fires. I'm just in the middle of it, and there's only so much time in the day.

Kyle Mercer: I see. And how long have you felt like this?

Alan Regala: Since things started picking up. Let's say I've been in business for a couple of years now, and things have gotten really good and successful. But I'm in it. I don't have time.

Kyle Mercer: I see. So this feeling of not having time is really present for you.

Alan Regala: Yes, absolutely.

Kyle Mercer: Was there ever a time in the past, before you started to get successful, that you felt pressured about time?

Alan Regala: I mean, there's always stuff happening, of course. But being an owner, there are just so many hats I have to wear that it never feels like I have enough time.

Kyle Mercer: I see. So it's like a feeling of pressure.

Alan Regala: Yeah. Things that have to happen and not enough time to do everything. So there's some pressure.

Kyle Mercer: And what's behind the pressure?

Alan Regala: I guess focusing on serving customers, and the things that I know I probably should be doing, but I'm not doing.

Kyle Mercer: I see. So it's this feeling that you've got all these things you should do, and then you put all this pressure on yourself. You have this list of all the stuff you need to do, so you're always putting pressure on yourself to do more. Is that just since you started the business, or have you always put pressure on yourself like that?

Alan Regala: I've probably always put pressure on myself to do more.

Kyle Mercer: To do more. Yes. That must be uncomfortable, always having to do more.

Alan Regala: Yeah. That's just the way I've been wired, I guess. I've always wanted to do. I'm a doer.

Kyle Mercer: I see. Did your parents have real expectations on performance, or was that something you developed yourself?

Alan Regala: No, I mean, some, but not significant, I'd say.

Kyle Mercer: I see. So the pressure to do more. What's the reward if you do more?

Alan Regala: More accomplishments, and hopefully more money.

Kyle Mercer: I see. So the important thing in life is more accomplishments and more money.

Alan Regala: They're not the most important things, but that's what I see at the end of the day with the work that needs to get done.

Kyle Mercer: Yeah, that needs to get done. So I'm just saying that you're living under a state of pressure rather than choice. And I know there's no real peace or enjoyment of life when we always have more to do. When do we actually get to stop and rest? In the next session, what we'd do is get to where that pressure is actually coming from. But let's just reset the possibility of what we're really after here.

One of the strategies could be that we schedule a day so that the day fits into the schedule, rather than always having to do more. So that we craft a life that fits with the life we want to live, rather than always ending the day feeling there's more to do, always ending every task with more to do. What if we structured it so that you were always feeling like you were in completion, rather than ending every task having to hurry on to the next thing? So that you'd be feeling completion throughout the day, rather than always lacking, always more to do, never having time for it. What if we consciously reconstructed your life around something that would make you feel satisfied all the time, rather than always lacking?

Alan Regala: Oh, that sounds amazing. That sounds great. Okay, scene. All right. That was great. That was really cool. Especially that last part, bringing it all together and flipping it around. So it wasn't about lack, always feeling behind, and always feeling that there's more to do. It was flipping that around to building in a structure that's the opposite, so you have a sense of completion and a sense of doneness, and you can then breathe and celebrate, I guess, and live beyond just doing.

Kyle Mercer: It's like we get to choose what we're shooting for. If we're shooting for peace and satisfaction and completion, then we can structure how we operate around that. I have a couple of stories around that exact same thing. I used to work with a lot of dentists, and those poor dentists would pile up all these journals on best dentistry practices on their desk. They'd have 10 or 12 of them, all needing to be read, plus all the things they should be doing in their practice, and it created this constant feeling of being behind.

So I said, you either read it the day it comes in, or you throw it away. And it's not just the journals, but all the things they should know and do. So they just threw them all away, and they were complete. They got to be complete around that. Some people have a pile of books to read by their bed. I say, cut it out. You're not enjoying your reading. You're just trying to get through your stack of books that you should read. Let's enjoy what we're doing, take it to completion, and appreciate and enjoy that.

Alan Regala: So how do you balance that? Because I can identify with that. Like you said with the journals and the articles, there's probably some information in there that would help me be better at what I'm doing. So how do I balance that with there being only so much time in the day? If I'm not going to do it, should I just get rid of it and get it out of my mind?

Kyle Mercer: We have just been indoctrinated by the system that we always have to do better. Even our culture is all about potential. I have to realize my potential. You have so much potential. Our whole school system says everybody should be driving for an A all the time.

I had this great entrepreneurial client. He was so smart. And he said, "I just want an MBA." So he went to one of the Claremont Colleges, and he said, "My grades aren't important. All I have to do to get the MBA is get a C average." So he went to school to get a C average, not an A, because all he was going for was the degree so he could do business better. And he had a great time in college. He said everybody else was working their brains out, but he just went and did what was necessary.

But we're always raising the bar. So I say, if you've got your bar at an A, you have to get an A. How do you feel when you get a B?

Alan Regala: Not great.

Kyle Mercer: Right. So if I lower my bar to a C, how do I feel when I get a B?

Alan Regala: Good.

Kyle Mercer: Yeah. And how do I feel when I get an A?

Alan Regala: I feel great.

Kyle Mercer: And how do I feel when I get a C?

Alan Regala: Expectation met, I guess. I cannot identify with this at all, just so you know.

Kyle Mercer: Yeah, exactly. I'm blowing your mind. It's just, what are we here in life to do? I had a business client in Florida. He came to me and said, "Look, I just want to sell my business for $5 million." I said, great. So I worked with him for two years and got his business ready to be sold for $5 million. Then he said, "You know, I've thought about it. I really want $20 million." I said, great, okay, I get it. So we worked another couple of years and got his business to $20 million. And sure enough, he comes to me and says, "No, I really need $50 million out of it. It's unfair unless I get $50 million out of it." He's still running down that same road. He didn't want to quit. Always raising the bar, constantly struggling, unhappy, all that kind of stuff.

So what are we here for? For me, it's self-expression, relationships, finding things and making them work, solving puzzles, and enjoying the realization of it. Everybody's pushing living and being satisfied down the road. How do we create present satisfaction? We've been taught that in present satisfaction we won't want to create. We'll just sit on the couch drinking beer and watching football or something. It's not true. We all want to create. But that always-feeling-behind feeling just makes life unpleasant. So how do we back off? We can still move toward things and set up that vision, but how we're living our life day to day is the most important thing.

Alan Regala: Now, that all makes sense. So I think what I'm taking from this is, it's okay to have a bar that's high, and it's okay to want things, but at the same time, it shouldn't...

Kyle Mercer: Here's a terrible quote for you. I've got to give you a terrible quote that you're not going to like. Wanting is not having. To want something means I experience the lack of it. So as long as I'm wanting, I feel lack. If I'm having, I've got all this. I've got this beautiful room, the sun's coming in, the leaves. I'm in present appreciation and satisfaction. And then I say, what would I like to create next? What direction do I want to move? What do I want to create?

But we're all taught that this feeling of lack is what drives us, that we need to be driven from lack. And all creativity, I find, comes from current satisfaction and imagining something I could create. Everybody I work with is anxious because they're not satisfied. We're almost afraid of present satisfaction.

Alan Regala: Quick pause. Owning a business isn't easy, but man, it's sure rewarding for the right person matched with the right brand. I'm a former franchise owner, 14 years, with a multi-million dollar exit. Now I help driven individuals find out if franchising is right for them, and if so, what the right brand is. First, I learn about you: your goals, skills, and investment level. Then I match you with a handful of opportunities from over 600 brands. I support you all the way through the process, and you get to decide if franchising is your path forward or not. And my service is completely free. I'm only paid by franchisors after you find the right fit and move forward. To get started, just go to athletetoowner.com/fit. Now, back to Kyle.

So, back to what I was saying. I feel like this is a pretty good summary, for myself anyway. It's okay to have a desire to achieve whatever it might be, but not to rely on that achievement to be happy in the present day.

Kyle Mercer: Great. Right.

Alan Regala: I should be happy with what I have, who I am, and where I'm at. I shouldn't be relying on the achievement of this other thing to be happy. It's still okay to have those desires and to want to be better, but I'm not waiting for that to happen before I can be happy.

Kyle Mercer: That's right. And I'm creating my life for current satisfaction, so that I have the energy to have a vision and continue to build toward it.

Alan Regala: Yes. Okay. That makes a lot of sense, and I feel like that would help a lot of people out.

Kyle Mercer: And people are so much happier. So much better relationships, more fun. When you're not feeling the lack, you can have more fun and be more creative. When I view it as "I'm lacking and I need," it triggers my whole nervous system into fear and lack, which puts me into tense fighting. When I'm filled and creating from that place, then it's creative and free and liberated and inspirational. My ideas are better. The way I communicate them is better. The way I inspire other people is better, because it's transmitted as abundance rather than as lack.

Alan Regala: Yeah. Belief systems are such a big thing. What you believe affects your thoughts, which affect your behaviors, and then the results. And what you're talking about here is really at that belief level. That shift is such an important shift to make. How long does that typically take with a client? Is the whole process about making that shift, or do you get that done pretty early on when you're working with someone?

Kyle Mercer: It's like a layer cake. The first one is the best, because we get this emotional layer off, and it's like, oh my gosh, amazing. So that one's really fun. Then there's the majority consciousness and the intrusion and all this kind of stuff. So we make this big shift, and we see things differently. My clients record it, and their experience is a life-changing event. I call them life-changing conversations.

The challenge is that there's this social regulation. If I'm talking to you, you make the shift, and now you're acknowledged by me in it and supported by me in it. But everybody else thinks differently and wants to hook you into their fears, anxieties, and drive, and all that kind of stuff. It's harder to maintain it without a social structure around it. That's why ongoing coaching is really helpful. I've got this insight, this epiphany, this freedom, and the world still encroaches on it. So either having a group of like-minded people who see things the same way, or a coach you check in with regularly, just keeps resetting it to your own truth and your own insight, because the world wants to trigger your emotional system into fear.

The news and the current social situation are all about fear and polarization and all that stuff. If you're watching the news, it's really hard not to get hooked into the social story about what's happening. Some people can just get it and hold it, even though the world is saying something different. But it's really helpful to stay in contact with somebody who helps you reconnect with that spot of your own truth and your own experience.

Alan Regala: Yeah. So for people who already own a business and are in it and running it, how can they tell if they're the bottleneck in their own business?

Kyle Mercer: They are. 100%. 100% chance. So we've nailed that one.

But the bottleneck, and this comes up so often: if you want to know what the leader is like, you can talk to an employee, and they're going to behave and think along the same lines. If I go into a restaurant and the waiter's rude, I know they have a mean manager, and I know they have a mean owner, because it just gets transmitted down through the culture. Otherwise, they wouldn't last there. They're getting told how to be, not by what they're told to do, but by what the leader's like.

So I have something called inquiry leadership and inquiry management. Leadership is about being the kind of person you want your employees to be. Not telling them to be it, but being it. If you want happy employees, be happy. If you want anxious, stressed-out, not-enough-time employees... I mean, almost every business has that not-enough-time thing. Every business I work with, I talk to the middle employees and they say, "I don't have enough time, too much work to do." Well, it's being transmitted right down from the top. It's just being passed down the chain.

So I don't even work with the middle people, except to help them accept the situation they're in, because the culture is established. You either accept the culture or you don't. There's not much you can do. That's why I like to work with the leaders, because first the leader changes, and then it trickles down. Inquiry leadership is being the kind of person you want all your employees and your customers to be. We're leading the way.

And then inquiry management is switching from expectations to being the vehicle for other people's success. The very first question we ask in inquiry management is, what does success mean to you? If your employee tells you, "I want to make $1 million before I'm 40," I say, great, let's see what you would have to do in this business to be able to do that. Let's chart a course for that. Now, instead of bossing somebody around, we've created a career course, and then we can coach them and mentor them in what they need to do to achieve that.

"I want your job." Great, that'll free me up to do so much. I'd love to give you all the knowledge and ability to do my job. Why don't you take on this responsibility, and we'll keep adding them until you're competent in all of them. Now I'm coaching you to do a great job. If they say, "I don't have enough time," I say, well, let's look at your priorities and do the most important things first.

Alan Regala: So let's go back to the employment path, because that's a really interesting one. Every person has their own desires and where they want their career to go. And for a lot of business owners, they're trying to balance their own needs with the needs of their employees. In an ideal world, both can happen. Employees move up the ranks, and the employer is able to accommodate that. But I think the worst fear for an employer would be, man, I've got this person who's fantastic, and I never want to lose this person, but there's only so high they can go within my organization, at least in its current form. You want that person to do well, but there's only so far they can go as things are currently designed. So how do you work with that with an owner?

Kyle Mercer: Well, that's exactly the problem. That person's going to get dissatisfied and leave. So if you're that employee and I'm the leader, I say, what are your life goals? What are your economic goals? And you tell me, and I say, wow, I haven't quite figured out how to make that happen in this company. Let's sit down and figure out how you can meet your economic goals in this company, and what you would have to contribute to be worth that much to this company.

I call this transferring accountability. I'm not responsible to make you happy. We are responsible to have a conversation where you can see a pathway to your success, and we set out guidelines for you to be worth that much to this company. And if you can't see that the company can provide that, you're going to leave anyway.

So say you want to make $500,000 a year. Okay, let's see. How much in sales would we have to do to do that? How could you contribute to getting to that level of sales? As soon as we're at that level of sales, I'd be happy for you to make half a billion dollars a year. I'm happy for you to make it, but I'm transferring the accountability to you, because we have a vision. When I have a business, it's like an economic environment. So I want to transfer the accountability from me making it happen for you, to you figuring out how to be successful in the economy of my company. We have to sit down, talk about that, and figure it out.

And if somebody gets a raise, I say, don't wait for next year to get your next raise. I would ask, what would I have to do to be worth 10% more to this company next year? If you're my employer, I'd say, that's great, I love this raise. What would I have to do to be worth 10% more to you? And you could say, well, you'd have to learn this skill, or you'd have to show these numbers. Now we've got a contract agreement. Let's just write this down. If I do this, I'll be worth 10% more to the company next year. Or you could say there's no way you could be 10% more valuable to the company. Now I know I'm in a dead-end job, and I either accept it or go find a different job. So as an employee, I push the problem up. I ask, am I going to make 10% more next year, and what would I have to do? I love it when an employee does that. "What would I have to do to be worth this much to you?" Well, let's figure it out.

Alan Regala: Yeah. Well, I'd love to come back to franchising now. In this industry, you've got a couple different things. You've got franchisors, obviously, which are the main brands, and they have their franchisees, the individual owners, which are typically the independent, locally owned businesses. First of all, let me ask, have you worked with any franchisors or any franchisees?

Kyle Mercer: No, I haven't. I'm really interested in learning about this. I understand the concept, of course, but what is the leverage point for success as a franchisee? What's the thing that is most viable for success in that kind of industry?

Alan Regala: Well, the whole concept with franchising is that a franchisor started with one unit, one business, like a storefront or whatever it is. It started as one successful business, and the founders or whoever decided they wanted to scale it. If it's a brick-and-mortar location, it's a lot of money you have to invest to build out a whole other store. If you're trying to do that all across the country, that could be very, very expensive. Plus, you'd probably have managers from the home office trying to bring those stores up to speed and all that. So it's a lot of money, a lot of time, and possibly less quality, trying to build up all those stores.

So instead, the franchising model is that you have franchise owners who are independent business owners. They'd be separate, not part of your franchise business, but they bring in their own money, and they basically license the brand and all the processes and systems so that they're able to open that storefront in their local area. They represent the brand and use all the same branding materials and all that other stuff. But they're invested, because they put their own money into the build-out, and then they pay a royalty to continue to use the systems and processes. They're their own business. They're independently owned and operated.

Kyle Mercer: Understood. And they have to meet certain standards or whatever. But as a franchisee, what's the leverage point? Is it efficiency in labor? What's the point where you can really leverage the value of your franchise?

Alan Regala: Honestly, the biggest leverage point is the systems and processes that have already been built. You're following a proven model. That's the whole point of franchising versus trying to set up a business on your own. Let's say it's a house cleaning business. A person could theoretically start their own house cleaning business by doing it themselves or hiring some people, but they'd have to create all the processes, the branding, the pricing. They'd have to do everything themselves. With franchising, you're buying the system. It's like a business in a box, essentially, and you have to execute. You have to be the one to execute it all. It's not like it just happens. It's not like you turn a key and it just works. You have to follow the systems and follow the processes.

Kyle Mercer: So the key is following the systems, and then you have a pretty predictable profit margin, I'm going to guess, if you follow the systems, because a lot of the marketing in most cases is probably done for you.

Alan Regala: The marketing is not necessarily done for you. It's probably spelled out, like, "Here are the things that work in the markets where we have it," but you still have to test things out yourself in your market to figure out what's going to work.

Kyle Mercer: So a lot of the profitability in franchising is your capacity to follow the systems and the procedures and processes. Not resisting the franchise guidelines, but just executing them well. And then you have a fairly predictable profit margin and sense of success. So for scaling in franchising, it's not really so much about running the franchise better, but getting another franchise, and then you have fairly predictable profits again on another franchise. Is that right?

Alan Regala: Yeah, I would say step one is being able to follow those systems and processes. And here's the thing with franchising. People can make it sound super, super easy out there, like you just turn the key and it's there. But there are systems and processes provided that you have to execute on, and your market could be a little bit different than the market where it's proven. So you still have to figure things out. You have to be able to execute, but also problem-solve in your local market, especially if you've never owned a business before.

And I'd say that's maybe the struggle for a lot of people. They can follow all those processes, but they're not learning from the franchisor how to be a leader. If they've never had to manage blue-collar labor before, they learn all this stuff from the franchisor, but now it's a different capacity than when they were in the corporate world, where everyone they worked with was white-collar, for example.

Kyle Mercer: I see. That makes a lot of sense. So it's a different kind of management context, and that people interface is maybe the part that makes it most challenging. Is that right?

Alan Regala: Yeah, the people part definitely can be. And of course, people are going to come in with different levels of experience from their previous work. You've got this whole new context now, because you're the owner. You're not working for someone else, and you're the one making all the decisions.

There's also a sense of the actual work that's needed in a small business. Like, oh, I'm going to have to get my hands dirty. I'm going to have to get in there and learn this and figure it out, versus "I've always paid people to do stuff for me." Is that willingness to get in and get your hands dirty there? Here's what I'll say. Anyone I've talked to or interviewed who has lived on a farm, I say, you're going to do great. You've got the work ethic. You know how to get down and get dirty and just figure things out and get it done. Other people maybe don't have quite the work ethic, I guess I would say.

Kyle Mercer: Can I ask you a question about that? I can tell you have a great handle on this. We talked about the always-busy thing and changing the mindset. So to really prosper and enjoy being a franchise owner, what kind of mindset do you have to have?

Alan Regala: I feel like the mindset has to be that you're going to follow the systems and follow the process. You're going to be someone who is coachable. I can learn from others, and at least try to do what I'm given and do everything as told before I try to change anything. So that's one thing.

Kyle Mercer: I like it, and I just want to highlight that. Because if I come in kind of arrogant, like I know how to do things, I'm always going to be resisting the systems. So you really have to come in kind of like you're learning martial arts or something. It's like, I don't know how to do this. Great, show me. So it takes an innocence and a humility to surrender to the system of the franchise, rather than, I'm better than this or something like that.

Alan Regala: Yes, exactly. I think there's some amount of ego that has to be put to the side. And in some cases, with certain kinds of businesses, they actually don't want people who come from that industry, because they come in with preconceived notions of how things are supposed to be. So coming in, being coachable, and being a sponge is really important.

And I think grit is such a big factor in all of this. Being able to understand that mistakes are going to happen and things are going to fall apart, but you've got to get back up and keep going, because it happens on a daily basis with any business owner. Any business has issues, and you learn to get through it.

Kyle Mercer: Tell me a little more about that. Because, yeah, I get that. If I'm buying a franchise, I kind of feel like everything's just going to go smoothly and easily. That might be part of the sales pitch. And then I find out that things go sideways. So it's coming in with innocence, recognizing that things are going to go sideways and I can correct for them, but not with this expectation that I'm just being handed a profit machine that prints money for me. It's not all going to go smoothly, and I have to apply myself to make it work.

Alan Regala: Yes. I think that's it right there. That's why I mentioned the farmer, anyone who's been on a farm. And this is why the name of my business is Athlete to Owner. It's not that I just work with athletes. It's the principles of high-performance training. It's the things people learn when they're doing anything competitive. You're not always going to win, and you have to keep getting back up.

Kyle Mercer: That's right.

Alan Regala: There's the amount of discipline you've got to put into this to make things work, and the drive to keep getting out there and keep going after whatever it is that you're after. So anyway, this was really cool to fuse with what you're doing.

Kyle Mercer: Yeah, it's great. It's the same thing. In my innocence about franchising, asking the questions and then reflecting what I'm hearing, the principles become clearer. And that's what I do with people. I ask, what's this about? Oh, I see, this is the essence of the thing. And when we get to the essence of the thing, everything just fits into place.

So I love that you're teaching that it's about the willingness to come in and be a learner and follow the system without thinking you're better than that. And then this willingness to take the wins and losses as you go along and keep going. It's such a great orientation, and it would be kind of the entry test to owning a franchise. Is that really what you want to do, follow a system, learn and do it the way you're told to do it, and go through the ups and downs of it?

Alan Regala: Yeah. That's a perfect segue into the last question I have. For the people out there who are thinking about getting into franchise ownership, maybe they're in the corporate world or any other job, and they're thinking, this is not for me long term. I want to take control of my own destiny, my time, my financial future. What's your top tip for someone who is thinking about making this transition?

Kyle Mercer: Well, I think I now have one, for the first time. I'd say, well, that's great, let's make the transition. Do you feel like doing something where you can just kind of relax, follow a system, execute it, and keep repeating it until you're good at it? Or do you feel like you really need to go out and create something new and express yourself? Maybe you'd like to express yourself someplace else and have the financial ability to do that. But are you willing to just drop in and follow a system that's going to lead to fairly predictable success? Is that what you want? Or are you looking to go out and take the world by the horns and create something? Those are two totally different kinds of personalities, two different intentions for what you want to do.

And actually, the way you're saying it sounds kind of good to me. Being an entrepreneur is like skydiving every day. Dropping into a well-worn system that knows how to fairly predictably produce money sounds like a very rational way to go about business.

Alan Regala: That's why I love franchising. And I've been in both camps. I created my own business. The very first business I had, I invented a product, ended up having it made overseas, wrote my own patents, did everything, and marketed it all over the country. And at the end of the day, it wasn't a success. So I got into franchising and had all the systems and processes.

What's really interesting is what I found, because I think this is something a lot of people think about franchising. They think, I'm going to be so constricted by the brand, and I'll have this franchisor I have to deal with all the time. It's like a marriage. They feel like they're not going to be free enough, that it's too confined. Kind of like what you said. What I found was that if you just change your mindset so that, hey, this is like a partner, this is someone I'm working with, and they're providing me with this opportunity, then within the bounds of the brand and what they provide, there's actually a lot of freedom, I found anyway, to do things the way I felt they needed to be done to be successful.

In my particular brand, I was in there in the first couple of years of their existence, so they were still developing things. It wasn't like McDonald's, where it's, "Here we have it exactly for you, don't change a thing." So there were ways I was able to express myself, if you will, and be creative, especially with marketing and other things like that. I still had creativity, but it was within certain bounds, and it didn't feel constricting to me. And that was better for me, because I think if it was just wide open, it would be much, much harder.

Kyle Mercer: Yeah, containment is great. I think you're absolutely right. If you tend to resist control, this is not the right path. But if stepping in and executing a known system sounds great to you, then it's like a home run. If you really want to reduce all the risk of hanging out there, and just make money, don't resist the system. Work with it. Figure out how to make it work for you rather than being upset with it or fighting it. As soon as you start fighting it, you're going to interfere with your own success, because you're not really accepting the situation.

Alan Regala: Absolutely. That makes a lot of sense. Well, Kyle Mercer, thank you so much for joining me today and sharing your nuggets of wisdom, and helping me to create more Franchise Champions.

Kyle Mercer: This is great. Thank you very much.