School Uniform Company Widens Franchise Footprint

(Saturday, March 29, 2008) - Since entrepreneurs Brian and Jamey Elrod started franchising their school uniform stores five years ago, they have gotten pretty good at it.

The store they opened in 1999 with $100,000 has now become a nationwide business projected to have revenues of $17 million in 2008, and the company's headquarters is still operating from their initial Brainerd Road location.

The husband and wife team has decided to take that franchising to the next level by offering small, mom-and-pop operations the chance to buy into Educational Outfitters.

"We"™ve grown very rapidly. We had two stores in 2003 and we are opening our 36th store this year,"� Mr. Elrod said. "Our offer is that it's scary when you"™re out there on an island by yourself and you don"™t have the buying power, the network, to compete against these larger companies, but if you want to stay in this business, there's a lot better position to be a part of a larger company."�

The conversion concept takes an existing independently owned store and makes it Education Outfitters, complete with the signs, logos and business model.

For a franchise fee of $10,000, the store can become an Educational Outfitters unit and gain the security that comes with the nationwide presence of the larger company, Mr. Elrod said.

The franchising arm of the company, Educational Outfitters Franchising LLC, just completed its first conversion franchise in Louisville, Ky. The cost to convert a store will vary, but Mr. Elrod said the average amount would be about $25,000 total, including the franchise fee and other things like signs and updating computer systems.

John and Wanda Clark own a franchise in Chattanooga that they opened three years ago. The store sells uniforms primarily to private schools around the Chattanooga area. Because of the store's unique model, Mr. Clark said the inventory is customized to the needs of the schools in the area.

Last year, the Clarks opened their second Educational Outfitters franchise, this time taking the concept into what Mr. Clark said was a new and fast-growing market, Huntsville, Ala.

Mr. Clark, who worked in the textile and apparel industries before he and his wife opened their Educational Outfitters store on Gunbarrel Road, said the couple has found great success with the franchise.

"It's a very unique business and if you have a passion for it, and there's a need for it, you can be very successful,"� he said. "The thing I like about it is you"™re always around kids, and it keeps people my age from getting older too soon."�

The company, currently sells its non-conversion franchises for $29,500 and charges franchisees 5 percent in monthly royalties. Mr. Elrod said the trend in the industry is consolidation, with larger companies like his own buying out smaller competitors.

Mr. Elrod said the initial reaction to the conversion concept from independent owners in the school uniform industry was one of skepticism, because Educational Outfitters is a competing company. But for many business owners, he said having the extra buying power, shared inventory and the recognition of a national brand is appealing.

"Not every mom and pop wants to get out of business,"� he said.

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