Striking out for a coup in the loo

Franchising: the Americans are coming, with a stream of offbeat but profitable ventures
By his own admission, Pat Swisher's chosen activity "is not a business that everybody wants to get into". But as if to prove that where there's muck there's brass, he is doing very nicely out of cleaning toilets.

Although his surname would appear to make him a natural for this line of country, Mr Swisher did not start off there. He was previously a supplier of satellite television equipment, but got out of the business in the early 1980s because of the twin pressures of competition from much larger companies and the constant updating of the equipment.

He came up with five ideas for pursuing his business career and asked his then neighbour in Charlotte, North Carolina - Erskine Bowles - to advise him on which one to opt for. To his surprise, Mr Bowles - now a member of President Clinton's cabinet, but then an investment banker - went straight for the cleaning service, saying: "It's got everything you want."

In particular, it was neither high-tech nor capital-intensive. And since starting out in 1983, Mr Swisher has not looked back. Now a publicly quoted company with a turnover of about $30m (pounds 19m), it has spread to more than 100 franchise operations in the US and Canada and is about to open up in Europe. Master franchises have been appointed for Britain and Ireland and the first businesses are to open soon.

But Swisher International is only the latest of a stream of US franchise operations to move into Britain. McDonald's is the most obvious example and among the others is Fastsigns, which arrived in 1992 but came under new management six months ago.

Brent Pollard, a former cricketer with a broad business background, has put pounds 500,000 into the operation and linked it more closely to the US base in Texas with the aim of using the 10-year-old organisation's experience to help develop the fledgling European Fastsigns network.

The concept is simple: using computer graphics to generate signs of all sorts quickly to order. And, since it is relatively easy to learn the techniques involved, there are many companies in the market. Indeed, Mr Pollard insists that when somebody buys a Fastsigns franchise, they are "not buying the know-how to make a sign. The difficult thing is how to make a business - develop customers and the rest. That's what you're buying from us."

The cost is about pounds 65,000, plus pounds 15,000 in working capital, but for that the franchise joins what is claimed to be the world's largest computerised sign maker with more than 350 outlets and a strong growth record. The key, says Mr Pollard, is being located in high streets and drawing on the US organisation's sales and marketing expertise.

Swisher has not been around so long, but seems to have done well for something that was only supposed to make its founder "a few dollars" to see him through to retirement.

Although he admits that Europeans do not share the US obsession with "health and the risk of infection", Mr Swisher still thinks the concept has huge potential: "If the only thing we were doing was sanitising, I would have been a little hesitant about international expansion. But what we do goes beyond just killing germs. Rest rooms have to be cleaned in some way and we can do it better than you and more cost-effectively."

The core of the offer is a weekly clean of all the fittings in rest rooms at restaurants, garages, cinemas and "anywhere that has a loo open to employees or the public". This is followed by a coating with a special acid solution that means the owner of the premises only needs to make a superficial daily clean. Over the years this service has been extended to include the provision of soaps, paper towels and other products. "You have no inventory, no pilferage, no waste and present a better image to your customers."

Mr Swisher reckons he has established a concept that will see franchises hitting profitability within their first year. The typical initial investment would be about pounds 15,000 to pounds 25,000, depending on the size of the territory, supplemented by a similar amount of working capital. But he adds that experience has shown profits of 20 to 25 per cent of gross revenues are possible.

"The return was one of the things that attracted me to the business," he says.