When Cuban immigrant Nicolas Estrella Sr. began promoting auto insurance coverage in Miami within the Nineteen Seventies, he had a gap line: His final title meant “star” in Spanish, so he and different Latino immigrants may guess on the identical taking pictures star — the American dream. “He realized he may fill a void within the market for the better Hispanic group,” says his son, Nicolas Estrella Jr.
Estrella Jr. took over as president of Estrella Insurance coverage in 2006. On the time, the enterprise had 40 company shops and three franchises, left over from a earlier try at franchising within the ’90s. However when Estrella Jr. took a more in-depth have a look at the franchises’ funds, he was stunned by what he discovered. “They weren’t doing properly,” he says, “however they had been doing very decently with none kind of help. And the revenue margin on that kind of enterprise was a lot better than the company mannequin.” This made him marvel: Ought to Estrella Insurance coverage strive franchising once more?
As we speak, the corporate has no company shops, 206 franchises throughout the nation, and is rising quickly. It nonetheless sells auto insurance coverage, however gives many different insurance policies as properly — together with for pets, boats, well being, dwelling, and extra. Right here, Estrella Jr. talks in regards to the pivot.
How exhausting was it to transition to the franchise enterprise mannequin?
It was very tough. On the time, we had a hair beneath 400 workers, with salespeople working on the company shops and back-office workers who all labored from a central workplace. [Back-office workers] made up a big share of workers in the entire group — however beneath the franchising mannequin, franchisees turn out to be their very own items and do their very own back-office work. So sadly, I needed to lay off numerous the company workers, lots of whom had been with us for therefore lengthy they had been like household.
How did you discover your first franchisees?
We made the present managers a proposal they could not refuse: We would offer them with the financing to purchase the enterprise and convert it right into a franchise. We did it over a span of two or two and a half years.
Now that you’ve got gone nationwide, do you continue to largely market to Hispanic communities?
What we determine is metropolitan areas which have density and variety. That is the place our enterprise mannequin works greatest. These aren’t solely Hispanic areas, however there’s been a big quantity of Hispanic progress within the U.S. over the past 30 years.
Are most of the franchise house owners Hispanic?
Predominately Hispanic ladies. We began off with a basket of places of work the place the managers had been ladies. This was one thing that, to a sure extent, was by design. My father felt that these ladies had been extra approachable. They had been going to work together with the group significantly better than the male persona. However after they noticed the success their bosses skilled, they stated, “I need my share of that.” So that they reached out to us, and we gave them the help they wanted to thrive and be financially self-sustaining.
How have issues modified from when your father began promoting insurance coverage?
The evolution of the immigrant group has modified every little thing. They’re enterprise house owners now. They’ve their very own grocery shops. They’ve their very own fuel stations. They’ve their very own mechanic retailers. They’ve turn out to be legal professionals. They’ve turn out to be medical doctors. They’ve grown, and it has allowed us to develop too.
Associated: The Professionals and Cons of Franchising Your Enterprise