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Pinch A Penny Franchise - John Thomas,President and CEO

John Thomas was born inWisconsin, raised in Clearwater, Florida.  John received BBA from Southern Methodist University,Dallas, Texas and  MBA from the Universityof Florida, Gainesville, Florida.   John is married with three children and activelyinvolved in numerous charitable organizations and church.

Franchise Expo:  Tellus about the Pinch A Penny concept.

John Thomas: Pinch A Penny is the nation’slargest and most successful franchise system of swimming pool supply retailstores and service departments.  We’vebeen around since 1975, have been franchising since 1976, and I think are oneof the best kept secrets in franchising. 

FE: Whydo you say you are a “best kept secret”?

JT: First, I say that somewhat injest.  But it’s partially true for tworeasons.  First, the majority of ourstores are located in Florida.  And whilewe are slowly expanding in the various Southeast/Southwest states, we don’thave a national presence, even though we have more locations than many nationalfranchised systems.  Second, our approachto franchising is a little different.We’ve never considered ourselves in the business of sellingfranchises.  

Our focus has always been tobe the best pool store and service department in the markets where we compete.  And, we believe that we can only be the best byhaving franchisees to partner with in serving our customers.  For us franchising is a vehicle to deliver thebest service to our customers, it’s not our purpose for being in business.

FE: Howand when did you become involved with Pinch A Penny?

JT: You could almost say I was born intoit.  My father started the company when Iwas eight years old.  I spent everyweekend and summer vacation working in the business, mostly in the retailstores.  Albeit young, my father allowedme to wait on customers, fill bleach containers, test customer’s water samples,and sell merchandise.  And while I had myshare of loading and unloading trucks, mopping floors and cleaning bathrooms,my father always let me do whatever my abilities allowed, even when somecustomers had a hard time reconciling my age with what I was doing. 

FE: Whatabout later in life?

JT: After earning a business degree fromSouthern Methodist University and an MBA from University of Florida, I rejoinedPinch A Penny on a full-time basis focusing my time on retail operations,marketing, and advertising.  By 1995 Ibecame President of the company, assuming responsibilities in all aspects ofthe business, but to this day I focus my attention more on operations and marketing. 

FE: Whatare some of the advantages in being a Pinch A Penny franchisee?

JT: We provide an incredible amount ofbackend support to help our franchisees focus on taking care of customers.  While there is no way we can eliminate all ofthe responsibilities a business owner has in dealing with office/administrativematters, advertising, training, and merchandising; we offer so much in theseareas that it frees up time for our franchisees so that they can focus most of theirenergy on being with the customers.Next, we are a “home grown”, family-owned, American success story.  My father started this business withvirtually nothing, and with the help of great associate/employees andfranchisees, we have become the largest and most successful franchisedretail/service provider in our industry.And, we are only operating in five states!  The money generated by the system stays here;it’s reinvested in the system, given to local charities, and supports thethousands of families whose careers are part of our system.  We don’t expatriate our profits to a foreignnation nor are we a publicly traded firm or private-equity owned firm wherequarterly earnings drive business decisions that may be good for today, but arewrong for the long-term.

FE: Whois your ideal franchisee?

JT: First and foremost, we are lookingfor people who have a moral compass that points north.  The franchisee/franchisor relationship islike a partnership.  Honesty, ethics, andintegrity are owed by me to our franchisees, and it is owed by them in returnback to us.  No business relationship inthe long-term can succeed without these attributes being at the center.  Second, we are looking for people that wantto work.  The success of our system isbased on our franchisees working in the stores, taking care of customers.  We don’t want passive investors that thinksuccess will come by hiring a manager to run the store while they stay home, orspend their time in other pursuits.  If Ithought that was a great way to succeed, I would turn Pinch A Penny into achain of corporately owned stores.  Idon’t need franchisees for their financial resources.  I need them because as a business owner, theywill care more about the success of the store, have more passion for thebusiness, and work harder to satisfy the customer.  We want franchisees that are not afraid ofhard work and being involved in the daily routine, working side by side withhis/her employees.

FE: Tellus a little about the retail/service swimming pool industry?

JT: I love it, but I suspect I’m alittle biased having spent my whole life in it.I love it because it is a needs based business.  The super majority of our transactions arebased on either solving a customer’s problem or preventing one.  And we are somewhat insulated from economicfluctuations.  No matter what ishappening in Washington D.C., algae will grow, pumps/motors/filters willeventually break, pools get dirty, etc…We have a customer relationship that is similar to that of Doctors andtheir patients.  We treat the sick, andwe help the healthy stay that way.  Wefocus on learning what needs to be learned to be the best source in town forhelp, having the best products to support that help, and doing so in a caring,friendly way.  And because knowledge andservice are such key components, mass merchant competitors and the internet canonly capture and compete for a minority of the overall market.  So the majority of pool owners are served byspecialty retail stores and service providers.And with approximately 15 million swimming pools and spas in the UnitedStates, there is plenty of opportunity for success.

FE: Whatare some of the greatest lessons you’ve learned in growing this franchise?

JT: First, there are no secret formulasor mysteries.  Success comes from hardwork, and working with honorable people.There are virtually no problems that cannot be overcome when you havegood people working together that are willing to do what’s needed to fix it.  Businesses don’t succeed or fail, peopledo.  Our success is based on our people;our franchisees, the associates that work in our stores, our servicedepartments, our distribution center, and our administrative departments.  And most importantly it’s based on ourcustomers and their happiness with us.Second, franchisees are partners and must be treated that way.  They are not employees and they deserve tohave open, fair, and honest communications.You have to have a culture where both the franchisor and franchisee aretrusted to each do their jobs respectively.And both groups need to have clear lines over who is responsible for eachof the jobs that are all ultimately needed to satisfy the customer.  The customer could care less whether we are afranchise system or a corporate system.The structure is irrelevant.What’s important is that the franchisor does its job so the franchiseescan do their jobs.  And if both partiesdo their jobs well, the customers are taken care of seamlessly and withexcellence.

FE: Whatadvice do you have for someone looking to acquire a Franchise?

JT: Visit, in person, as manyfranchisees of that system as you can, and talk to the owners.  Ask them what they like and what they don’tlike about the business, their franchisor, and their lives.  If you randomly meet and talk with at least20, preferably more, you will have a solid grasp on what your life will be likeas a franchisee of that system.  If youvisit that many, you will likely come across some that are unhappy, some thatare thrilled, and some that are in between.But, if you hear the same thing from everyone, good or bad, you canfactor that issue into your decision.Also, read the Franchise Disclosure Document and draft FranchiseAgreement.  

Don’t be afraid to askquestions of the franchisor.  Don’t beafraid to contact franchisees that have retired/left the system within the pastfew years.  Researching a franchisesystem is not hard, it’s just time consuming. 

I always encourage our applicants to visit our franchisees and study whowe are.  Dissatisfaction from franchiseescomes from the franchisee expecting one thing, and finding out that reality issomething different.  Life is too short togo through it unhappy, so prospective franchisees should take the time on thefront side to find out what life is like in that system.  Franchisees are not going to materiallychange the system, so find a system that is already close to what you arelooking for.  Franchisees that do this willprevent all of the grief that comes from trying to fit a round peg in a squarehole.  Franchise applicants need to behonest with the person they see in the mirror, know what they are looking for,and only proceed with a particular franchise when they truly believe it isaligned with their personal goals/desires.Our franchisee satisfaction ratings are extremely high because we forceour applicants to take more time to research us.  It’s not that we are perfect and don’t havechallenges.  All businesses do.  But, we work hard to help our prospectivefranchisees know who we are and what we are so they can be certain we are agood fit for each other.

FE: In your opinion, why do you thinkthat Pinch A Penny would be a great opportunity for someone?

JT: Based on some of my answers above,it may not be.  For some people, Pinch APenny is not a great opportunity.  We areonly a great opportunity for someone that shares our belief in the importanceof ethics/integrity/work ethic and so forth.It’s only a great opportunity for someone who wants to have a familybusiness where their kids/grandkids can work; one where you are home for dinnerat night, and one that is driven by customers’ needs, not wants.  We are an excellent opportunity for someonethat is not looking for just an investment, but is looking for a place to workwhere they ultimately get the rewards of their hard work.  It’s an excellent opportunity for someonethat wants to own a business, but doesn’t want the business to be open 24hours/day, seven days a week, or serves alcohol late at night.  While there is nothing wrong with sellingdonuts, operating a hotel franchise, owning a food franchise, or a conveniencestore, every business has its challenges.Our franchisees like the fact that they don’t have to get up in themiddle of the night to get their business ready for the day.  They like not going home at 2:00 am.  Our franchisees like having the ability to beclosed on major holidays.  Pinch A Pennyis an opportunity to own a business that provides for better balance of familylife and business than many other franchise concepts, and one where familymembers can work side by side, building a future together.


Vince Caffarello of Duraclean International

Vince Caffarello started in the Cleaning & Restoration Industry on April 4, 1960. He began with ServiceMaster as a salesman of cleaning services, in their company owned Chicago branch office.