Why MiniLuxe thinks franchising is the key to growth and a better nail industry

MiniLuxe has been around since 2008, but in the last year has introduced a new model to open more locations via franchising. Right now, the company has a little over 20 locations around the U.S., but it has plans to increase that by the thousands via franchising.

Its co-founder and CEO, Tony Tjan, joined the Modern Retail Podcast this week and spoke about the company’s ambitions.

“There is no other industry that employs as many hourly trade workers and trade women workers as nail care, outside of domestic cleaning,” Tjan said. “That’s that’s the why. The how is along three Cs: we need to be clean, we need to celebrate craft and we need to be creative.”

With that, the company has built out its own system of nail salons that uses its own products. It also boasts paying workers higher wages and offering them company equity. Now, to help the company grow even more, the hope is to use franchising to reach a new level of scale MiniLuxe has yet to see.

Here are a few highlights from the conversation, which have been lightly edited for clarity.

Trying to change the industry one location at a time
“I think we still have a long ways to go. I think we are still a relatively small drop in the ocean of nail care. When you think there’s 65,000 places to get your nails done, and we’re [at] 23 and beginning franchising — we can see ourselves having thousands over the next several years of MiniLuxe — that’s still a relatively small percent. That said, by shining a light on the issues, there’s certainly been greater awareness.”

Why MiniLuxe decided to make its own products
“We also made a decision, probably year five in, not to use any of the incumbent brands of nail polish and nail-related treatment services. And I, alongside my partner, we finally put to some use our biology and biochem degrees and worked with some of the top people all around — we were privileged to work with some of the top people at the MIT labs — to try to create and push forward formulations that are better and safer for you in the world of nail care.”

The thesis behind franchising
“It’s worthwhile stepping back and talking about: why do people franchise? One is it’s a capital-efficient source so that people can be more capital-light in rolling out franchising. And that’s usually what people default to — oh, they want to grow fast; they want to they want to scale fast. And that’s part of it. But two other dimensions that have been really, really important to us… is that we have always believed that our brand has been a platform for empowerment. Our own nail designers have a system where they can continue to gain economic empowerment and creative empowerment. But we are encouraging our own team members. Over time, our hope is that some of our best franchisees come from our internal system. We have already half of our nail designers — what people more commonly might refer to as technicians, but we don’t love that term — who own equity in the company. And we have had our first set of nail designers and our first set of studio manager leaders for us at MiniLuxe come forward saying they’re interested in a franchise. That would be a real dream because that helps us accelerate our dream of franchising as a vehicle for true empowerment. Our vision [is] to create the first set of mani-millionaires, as we internally call it. The second reason, though, that franchising is really important to us is to really build a neural network of learning and innovation. Think of it as crowdsourcing.”