Hand & Stone's Biggest Franchisee: "It's All About People"

Eric Danver is the owner of FGG Spa, LLC, which makes him Hand & Stone Massage and Facial Spa’s biggest franchisee. His network includes over 75 spas that are either open or in development. Eric’s a lifelong entrepreneur who grew up selling balls and sodas on a golf course before becoming a highly successful franchise operator. Earlier this month, Hand & Stone announced he has committed to opening 13 additional locations in the next five to six years.

Prior to working as a leader in the wellness and recovery space, Eric was a major franchisee for Papa John’s, operating over 50 pizzerias. We sat down with Eric to learn what’s made him so successful at scaling franchise businesses and explore the center of the Venn diagram between pizza and massage services.

I’ve always been an active guy, so I really enjoyed massages, but never really found a place that I was comfortable going and getting massages. I’d go in resorts and different places and pay a few hundred dollars to get a massage. When I found Hand & Stone, I loved the service and loved the value, and just loved the place as a customer for a couple years. My wife was a client as well, and she said to me one day, “Gosh, this might be a good business to get into.”

Scaling franchise businesses

I started doing my due diligence and looked at the competitors and looked at Hand & Stone and really just felt like they were going be the clear winner in the category, based on the leadership team and other factors. And I’m really happy that I ultimately made the decision to work with them, because I feel like we have won.

I had previously scaled with Papa John’s, starting with the first unit in New Jersey in 1996. I ultimately ended up with 53 of those. So, by the time I was working with Hand & Stone, I knew what it took, and here’s the secret: it’s all about great people.

Providing opportunities has always been a goal of mine, and as you grow, you get to provide more and more opportunities for your team members. We always say, “You take care of the internal customer, they’ll take care of the external.” You just build a network of people that are really hardworking, and as you grow, you get to provide more and more opportunities for those who are helping you succeed.

That’s really been what’s powered my evolution: a little bit of knowledge, a little background experience, and then finding the right brand and scaling it by building great teams. It’s been exciting.

I’ll go back to the people piece. You’re only as good as the team you surround yourself with, that’s the biggest thing. The pizza business is extremely competitive; you learn a lot about margins and how every penny, nickel, and dime counts in your business. You really learn how to manage costs and control the top line.

Once we transitioned to the Hand & Stone business, it’s a totally different industry, for sure, but so much of the same knowledge applies: how to scale real estate, how to approach construction and buildout, how to create a bigger platform. Having that prior experience was very helpful.

Leadership and growth strategy

Our philosophy has always been to promote from within whenever we can. I think you create culture by taking care of your people while also providing opportunities for them. Nothing is more gratifying for me than seeing some young people come into our organization and take a hold of the opportunity that’s in front of them.

Our vice president of training is an example of that. She went from being a front desk person to an assistant manager, then from assistant to manager, then she was a regional manager, and then grew to become our VP of training. Our vice president of operations for our north division followed a very similar career path.

The proof’s in the pudding, and a lot of our leaders are people who’ve been with me for decades and just really put the hard work in.

Really, due diligence is the most critical part, and you need to make sure you feel really good about the opportunity. For me, I had to be with brands that I was really passionate about. I had to believe in the product or service. That’s really important.

You also have to realize you are very reliant on your franchisor, whether you like it or not. You’re really partnering with them. You need to feel like they have a strong leadership team that’s going to be around for a while and that they have a vision for bringing the brand forward.

You absolutely need to be looking at the economics of the business, too. A lot of people want to own their own business in theory, but when they get in there, they realize there’s a lot to it, and it’s not for everyone. It’s important to be cautious and know what you’re getting into.

But, for me, here’s the million dollar question you should be asking: “Are the existing franchisees growing?” Because if they’re growing and building more units, it’s a positive sign that they’re making money, and they’re reinvesting in the brand because they like what’s going on. For me, that would be the first thing I’d really be looking hard at. And then, of course, you need to validate that by actually talking to franchisees who are in the system and capturing their authentic thoughts.

I think it’s important to know what your goals are and what are you are trying to achieve, short-term and long-term, and what is it you’re after. Do you want to have six units? Ten? A hundred? What’s the plan to get there, and how are you going to execute that plan?

For me, I’ve been very fortunate to bring in some partners that were very helpful. I always say banks will lend you money when you don’t need it, but they won’t lend you money when you do. That’s why having some partners that believe in you and believe in the brand and believe in what you’re doing is really important.

I talk to people who own two or three units, and they ask me, “How do you do it with so many locations?” And the answer is that there are only so many hours in the day. I’m sure they’re working just as hard as I am. So, it really becomes about delegation and having the right people and the right team members around you.

Obviously, we signed up for a big development agreement with the company, which shows how much we value our partnership with them. They just brought on a new CEO with a great background, so we’re excited about that. The brand continues to do just so well when you look at comparable sales growth, membership gain, and things like that. It checks all the boxes for us.

My personal goal is to be at 100 units within the next three or four years, so we’re going continue to grow through development and M&As and continue to provide opportunities for our valued employees.