Crye-Leike Grows Through Franchising

Memphis, Tenn. –  Crye-Leike, the nation’s 10th largest real estate company, has taken a new and aggressive marketing approach to expanding its brand through its franchise division, Crye*Leike Franchises, Inc., which has resulted in a 157 percent increase in franchise growth over the past two years.

Crye*Leike Franchises, Inc. (http://franchises.crye-leike.com) is working to broaden the franchise efforts of the largest real estate company in Tennessee and the Mid-South from a current base of 19 franchise offices in five states throughout the Southern Region of the United States.

Staff members of Crye-Leike’s franchise division have become road warriors by traveling to state Realtors’ conventions in Alabama, Arkansas, Georgia, Mississippi and Tennessee, setting up exhibit booths to spread the Crye-Leike brand name and to inform the Realtor community about the benefits of operating a Crye-Leike franchise office.

“As the competition in real estate franchising has increased, the best way to spread the Crye-Leike name to the greatest number of people at one time is to have a presence at Realtor state conventions,” said Crye-Leike President Dick Leike who oversees Crye-Leike’s franchise division.  “Being an exhibitor, along with making marketing presentations to smaller real estate firms in outer lying areas, is the approach Crye-Leike is taking.”

And his strategy is paying off. Three additional franchises have been secured, with grand openings held in May in Batesville, Ark., Greeneville, Tenn., and Gatlinburg, Tenn.

The franchising division of Crye-Leike began operations in 1999 and focuses its marketing efforts on establishing franchise territories in smaller populated areas where it would not normally open a company office because of market size and location.  Crye*Leike, Franchises was recently ranked as the 18th largest Tennessee-headquartered franchisor by the Nashville Business Journal.

Franchising involves three basic principles: 1.) a franchise license to use the trade name;

2.) significant operational methods and controls provided by the franchisor as well as assistance; and

3.) an initial franchise fee is charged and a continuing royalty fee must be paid to the franchisor.

According to the International Franchise Association, an estimated 1,500 franchise companies in 75 industries are currently operating in the United States, generating more than $1 trillion annually in sales. These franchises do business through more than 320,000 retail units and provide jobs for more than 8 million Americans.

Crye-Leike’s Chief Executive Officer Harold E. Crye saw franchising as an opportunity to expand the company’s brand name without having to spend the large dollar amount necessary to open a branch office.

“Franchising provides a way for real estate brokerages to grow and build their networks,” said Crye. “We are able to open offices but do not have the expense of owning and operating them.”

“Many prospective franchisees are always asking me, ?What makes Crye-Leike so successful?'” said Leike. “It’s really hard to pin down one specific marketing strategy that has been responsible for the success of this $3.66 billion dollar company. Yes, it has taken a group of strategies and systems that are in place as well as a powerful sales force to become the 10th largest in the nation. But, if I were to identify just one, it would have to be our ?hub & spoke’ support system.”

Crye-Leike differentiates its franchises from other real estate franchising companies by using a hub and spoke support system.  Crye-Leike franchises branch out from its regional hubs located in Chattanooga, Memphis, Nashville and Little Rock.  All Crye-Leike regional hub offices provide franchisees with similar support services available to Crye-Leike’s branch offices.

“Services are provided at little or no charge to the franchisees which include support services, training through Crye-Leike College, Internet technology services, administrative support services and marketing services,” said Leike.

“The hub and spoke method may be slower and more expensive, but it is the best way for our company to expand the brand because of the support system provided to our franchisees,” said Leike. “Because of Crye-Leike’s proximity of its regional offices, we are able to provide more convenient, local support to our franchisees as compared to most national franchises that provide long distance support.”

Many national franchisors charge extra for the same services that Crye-Leike offers all of its franchisees for free.  Some also charge higher royalty fees for being closer to a regional or corporate office because they know the franchisee will use their services more frequently.

“Crye-Leike works the exact opposite way,’ said Leike.  ” We want our franchises to use our services to help them succeed, which is why we use the hub & spoke method.”

There are multiple reasons for franchise growth within Crye-Leike and in the real estate world, in general, notes Leike.  Franchising is seen as a good alternative for someone wanting to start a business, even without real estate experience.  Franchising in real estate is seen as extremely beneficial at this point in time because of the investment value of real estate, the best solid long-term investment available right now. And, the vast resources in place and support Crye-Leike corporate is able to provide is valuable for new franchisees just starting out, providing customer support seven days a week.

Crye-Leike takes a genuine interest in the success of their franchise offices. Current and prospective franchisees are invited to quarterly meetings.  “There they have the opportunity to see the larger picture of the real estate world and to gain the knowledge that someone big is behind them for support and to help them succeed,” said Leike.

“If our franchisees can see that we have a vested interest in their success and that we are here to support them in every step of their journey, it can change the way they look at doing business in small towns,” added Leike.  “We want to show them that we are behind them, but not looking over their shoulders.”

“It’s a win-win situation, ” continued its chief executive officer Harold Crye. “We may not own the franchise, but we can provide our vast resources and more that a quarter century of real estate expertise to assist all of our franchisees to make their local offices better and stronger. That, in turn, provides strength to our parent company.”

Crye*Leike Franchises, Inc. (http://franchises.crye-leike.com/) is the franchisor of Crye-Leike, the nation’s 10th largest real estate company and the largest serving the Southern Region of the United States.  It is a member of the International Franchise Association, the largest franchise association in the world representing leaders of more than 70 industries.

Crye*Leike Franchises is comprised of 19 independently owned and operated franchise brokers who are currently located in five territories within the United States: Tenn., Ark., Fla., Ky and Ms. They include: Cumberland, Greene, Grundy, Hamblen, Meigs, Putnam, Rhea, Roane and Sevier counties in E. Tenn.; Hardin County in W. Tenn.; Mississippi and Independence counties in Ark.; Lowndes, Marshall and Union counties in Ms.; Warrren County in Ky.; and Okaloosa and Walton counties in Fla. Crye*Leike Franchises has over 100 sales associates and employees.

Crye-Leike (www.crye-leike.com), a full service real estate company for 27 years, has a network of over 2,800 sales associates and 74 branch and franchise offices located in 40 counties throughout a six-state southern region in Tennessee, Arkansas, Mississippi, Georgia, Kentucky and Florida.  Crye-Leike attained sales of $3.66 billion and 24,953 closed transaction sides corporate wide in 2003.

 

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