Franchise Chatter: Exclusive Interview with Mike Mooslin, President of Color Me Mine

Exclusive Interview with Mike Mooslin, President of Color Me Mine, Originator of the Paint-It-Yourself Ceramics Concept
by Franchise Chatter on June 29, 2012

Color Me Mine is the leader in the contemporary ceramics industry with nearly 140 locations in operation worldwide, including studios in 26 states throughout the United States. Founded in 1991, Color Me Mine provides consumers with an upscale art-as-entertainment studio offering a relaxing environment to choose from 350 unfinished pieces and express their own vision through painting.

The company recently reported that average unit volumes at its 140 studios worldwide nearly double that of independently owned paint-it-yourself ceramic studios. Although Color Me Mine represents
just 15 percent of U.S. ceramics locations, it accounts for approximately 30 percent of the revenue stream in the industry.

Mike Mooslin, president of Color Me Mine, has been involved in fast food franchising for over 30 years (7 years with McDonald’s, 17 years as President of Naugles Drive Thru, and 7 years as a franchise consultant to franchise attorneys and restaurant chains). Mike sold his consulting company and private restaurant holdings to develop KOO KOO ROO, a fast-casual restaurant concept, which was later sold to El Torito in the 1990s. In 1998, Mike bought Color Me Mine, the leader in the paint-it-yourself ceramics industry.

Franchise Chatter (FC): For those unfamiliar, what is the concept behind Color Me Mine?

Mike Mooslin (MM): Color Me Mine is the originator of the paint-it-yourself ceramics concept. Founded in 1991, Color Me Mine studios provide an entertainment, enrichment, and bonding experience for families. Customers come to a studio and pick a white, blank ceramic object and decorate the piece themselves with the assistance of our employees, if needed. The next step is to glaze and fire the pieces. Once that is completed, the customer comes back in a week or less to pick up their finished masterpiece.

FC: Can you talk about the business model for a Color Me Mine franchise? How do your franchisees generate revenues? What are the major expenses to generate those revenues?

MM: Cost of sales is quite low making the lease the biggest single expense. Cost of sales is about 18%, labor about 18%, rent about 20%, and administrative expenses about 20%. The average sales is $266,000 per year, with profit in excess of 22%. Primary revenue drivers, besides walk- ins (40% impulse), would be group sales from girl scouts, birthday parties, wedding and baby showers, fundraisers, day camps, and after-school enrichment programs.

FC: How has the difficult economy of the past few years impacted sales at Color Me Mine locations?

MM: We have actually seen an increase in sales during the recession. With the difficult economy during the past couple years, we have noticed an interesting trend in which people are traveling less and looking for entertainment close to home. I think people are also doing more personal gifts rather than buying expensive items at a department store for holidays or birthdays.

FC:Can you describe Color Me Mine’s primary target customer?

MM: Our primary target customer is women ages 18 to 54, and children under 12. Additionally, those with upper middle incomes and above, with a college education and a small family size are also ideal target customers.

FC: What is the ideal location for a Color Me Mine franchise? What is the size of a typical location?

MM: Color Me Mine’s ideal location is in vibrant downtown walking areas; entertainment or lifestyle power centers with movie theaters, day spas, women’s apparel, and children’s services; or malls.

FC: What is the typical role of a hands-on Color Me Mine franchise owner/operator? What are the staffing requirements for the average Color Me Mine location?

MM: Each studio hires 5-7 part time employees (about 90 employee hours). Color Me Mine franchisees work in the studios about 30 hours per week, and conduct marketing strategies (online and in-person on a grass roots basis) about 8-10 hours. Our franchisees and staff must have outgoing personalities, enjoy children, and be proficient with computers.

FC: What kind of training and support can your franchisees expect to receive?

MM: Color Me Mine hosts a 10-day program at the home office training facility. This includes three days in a local studio, plus five days with a trainer on site to help franchisees open their new studio. Additionally, the Color Me Mine home office team provides full real estate support (site evaluation, letters of intent, lease negotiation, contract signing, etc), construction and opening support, as well as ongoing operations support and training at regional and annual meetings. We also provide monthly financial and operating analysis.

FC: What can you tell us about the estimated initial investment, royalty fee, and profit potential for a Color Me Mine franchise?

MM: Initial investment is about $145,000. The royalty fee is 5% of gross sales. Additionally, franchisees pay 1% of gross sales to corporate for producing marketing materials, and $80 per month for 7-day per week online computer support and license upgrades to computer systems. Average profit for a studio open more than one year is about $58,000 ($86,000 for the top 25 ranked studios). This can be looked at as an additional income for a family rather than a business that alone will support a family.

FC: Why should some interested in opening a ceramics paint-it-yourself business go with a franchise like Color Me Mine versus starting one on their own?

MM: The business appears easier than it really is. Color Me Mine eases small business ownership by helping handle a lot of complexities that the average independent does not have the skill set to handle, such as real estate, leases, financial analysis, inventory, and merchandising management.

Unlike independent operators, Color Me Mine has national marketing partnerships with companies like Warner Bros., Pixar, Disney, etc.; national buying programs that reduce costs; brand awareness among landlords, making better locations available than would normally be offered to an independent; 24/7 support center; website management; social networking programs; national gift card program; bank financing support; business plan development; studio design; marketing programs; window display services, among others.

FC: What are your growth targets for 2012 and beyond? Which regions are you targeting for expansion?

MM: Color Me Mine would like to open more than 20 new studios in the coming years in key markets, such as Atlanta, Georgia; Austin, Texas; Charlotte, North Carolina; Chicago, Illinois; Cincinnati, Ohio; Cleveland, Ohio; Dallas, Texas; Houston, Texas; Milwaukee, Wisconsin; New York City, New York; Phoenix, Arizona; San Diego, California; Seattle, Washington; St. Louis, Missouri, among others.