Becoming an Epcon Franchise Builder is a serious commitment, and you will probably have questions prior to joining. A meeting with an Epcon representative and review of our Franchise Disclosure Document (FDD) will answer most of your questions, but as a starting point, here are the answers to some questions we are frequently asked.
Frequently Asked Questions
What is the Franchise Disclosure Document and how is it different from the Franchise Agreement?
As part of the inquiry process, you will be provided a copy of our annual Franchise Disclosure Document (FDD). The FDD is a set of 23 disclosures called Items 1-23, the contents of which are mandated by the Federal Trade Commission (“FTC”). These disclosures describe many details about the Epcon Communities Franchise opportunity such as the costs, the obligations of the franchisor and franchisee, and the benefits of the system. The FDD is not a contract. It is similar to a prospectus. Certain states also require additional disclosure language to be included along with the required FTC disclosures. Item 22 contains a list of the contracts which you will likely enter into with us should you be awarded a franchise. The Franchise Agreement is one of those contracts and is an exhibit to the FDD. It is important to note that the Franchise Agreement is in fact a stand-alone document, and is the primary contract that will govern the franchise relationship. Other related contracts may be required, samples of which are also contained in the FDD.
What are the initial/upfront fees?
Detailed information about the upfront fees associated with an Epcon Communities Franchise are located in Item 5 in the FDD.
What does Epcon provide as support to me once I sign a Franchise Agreement?
Epcon Communities Franchising exists first and foremost to support our franchisees. Our team of franchising, real estate, and design professionals are here to help our franchisees through the real estate acquisition, site development, construction and sales process. Additionally, our Franchising team has access to the professionals and resources used to design and develop Epcon’s corporately-owned communities in Ohio and North Carolina, so we are collaborating to create, execute and perfect the Epcon vision every day. In addition to the direct support and collaboration you will receive from Epcon Communities Franchising, you will also gain access to our many franchisees who can share best practices and unique design resources to help you along the way. Item 11 in the FDD details Epcon’s assistance, advertising, computer systems and training provided to franchisees. To start, you will visit our headquarters in Dublin, Ohio, to meet our team and learn more about the company, what to expect, and next steps. We will also provide you an Operations Manual, and several additional manuals containing information related to the operation of the Epcon Communities Development System. Training programs currently being offered include New Franchisee Orientation, Sales and Marketing Orientation, Construction Training, the Epcon National Conference, additional sales trainings & regional meetings.
Once I commit to a franchise with Epcon, will I have a protected territory or a first right of refusal?
Item 12 in the FDD contains detailed information on territory rights. Epcon does not offer a first right of refusal but does offer the opportunity to sign Market Area Agreements to protect areas to be developed. At the time the Franchise Agreement is signed, a Market Area Agreement is also signed. The Market Area Agreement is based on population as well as other factors, and protects the geographic area surrounding the project development site that will generate the most purchase support (typically 60%-70%) for the development. Generally speaking, a market area will roughly encompass a radius between 3 and 12 miles from the site, but will take into consideration existing natural and man-made boundaries in the area, as well as other franchisees’ protected market areas.
Does Epcon require me to work full time in the franchise business?
Item 15 outlines requirements with regard to the obligation to participate in the actual operation of the franchise business. Epcon does NOT require the franchisee to participate personally in a full time capacity in the development and construction of the Epcon Communities development business. Epcon does, however, recommend that an individual with an ownership interest in the company directly participate in the day-to-day operations.
I currently build another residential housing product. Do I have to give up my current business?
Item 16 details the restrictions on what franchisees may sell. While we do not generally restrict the type of goods or services that a franchisee may offer, we do require that Franchisees not modify the Epcon Communities Development System (except as necessary to comply with building codes and permits, and local, state and federal laws). We also prohibit, except in limited circumstances, the development and construction of residential homes SUBSTANTIALLY SIMILAR to our architectural plans and specifications for residential dwellings.
How much money can I expect to make by investing in an Epcon Communities Franchise?
Item 19 contains the Financial Performance Representations pertaining to the Epcon Franchise opportunity. We do not estimate the revenue or income that a franchisee might realize in the development and marketing of its Epcon Communities project. We highly recommend you speak to our current franchisee builders during your due diligence phase to discuss their business experiences with the Epcon system. We cannot make any financial performance representations other than those contained in Item 19.
May I speak with other Epcon Franchise Builders about their experience?
Yes, in fact, we encourage you to do so. Exhibit P in the FDD contains a list of all current Franchise Builders, their locations and their phone numbers.
Is there a way to sustain our business’ viability in different economic cycles?
Yes, and sustaining your business’ viability in different economic cycles comes down to two main points: diversification and financial strength of the segment.
Diversification is important to sustaining the viability of your business whether you’re a builder, developer or investor. Diversifying the projects you are involved in is a great way to see success no matter the current economic situation.
Another way to sustain your business’ viability is to evaluate the financial strength of the target market. In the case of Epcon Franchising, our homes appeal to the 55+ active adult market. Baby Boomers have incredible financial strength and security, which means our core home buyers are not as heavily impacted by economic downturns. This demographic of buyers has already made their money and want to spend it; they don’t worry as much about interest rate fluctuation and other economic factors. In fact, people age 55+ represent 48 trillion dollars in net worth¹. This is the highest net worth collectively in human history. So, the sheer buying power of this segment will help stabilize market fluctuations and provide a more reliable source for purchasing homes even during difficult economic times.
Are there opportunities to capitalize on the 55+ market?
Yes, absolutely. The 55+ market is the largest and most underserved segment of home buyers at this point in time. In fact, Metrostudy estimates that the demand for low-maintenance, single family homes is far exceeding supply. And since national builders have not yet flooded the market, now is an excellent time for investors and home builders to target this market.
Additionally, the 55+ housing market shows steady growth. The National Association of Home Builders states that the 55+ housing market has shown year-over-year gains every year since 2012, and we don’t expect that to stop anytime soon.
When you become an Epcon Franchise Builder you can build homes that appeal to the 55+ home buyer with tested home designs and layouts based on our market research. We offer fantastic amenities that resonate with the 55+ lifestyle, and designs that appeal to every region of the country. Based on more than 30 years of meeting the needs of this audience, Epcon provides the optimal turnkey process to take advantage of the 55+ market.
What can I do to offset supply cost increases and labor shortages?
The best way to offset supply cost increases and labor shortages is to take advantage of a franchising system where you can become a part of a top 50 U.S. home builder. By doing this you leverage our economies of scale and outstanding contractor relationships that would otherwise be out of reach to a smaller builder.
We help offset your supply costs by giving you exclusive access to distributors who we already have a great relationship with and allow us to buy in bulk.
Our proven processes and systems allow contractors to complete work more efficiently and effectively. Because we develop communities that provide consistent work, contractors are more likely to pick these jobs over a big, one-time special project that requires additional research, energy and time. Another benefit is that because the construction process is similar for all of our homes, we have contractors that are very familiar with our approach and can build components offsite during poor weather and then bring them to the job site. All of these factors aid in more production and contribute to the bottom line that make Epcon an employer of choice for the best contractors.
Is there a way to compete more effectively with national builders?
Yes, with Epcon Franchising you can compete more effectively with national builders by becoming a part of one. And the great thing about our system is you still get to retain the individuality that comes with owning your own business and brand.
Instead of being acquired by a national brand, you are just acquiring the knowledge of a top 50 builder and our more than 30 years of experience. You are able to tap into the national builder system and take advantage of everything that national builders do well. You get the proven plans and systems to streamline your processes, access to products with discounted pricing and the brand recognition that give home buyers security since you have the Epcon name associated with your brand.
Another benefit is that many lower volume home builders are only as good as the people you can hire. Now you can take advantage of the purchasing advantages, Epcon’s years’ of experience, strong systems/processes as well as our sales and marketing expertise. With Epcon, you get expert advice on every aspect of homebuilding, from site selection to closeout.
How do I scale faster to reach my business and personal goals?
When wanting to scale faster you have two options. One, you can design, create and implement processes yourself; or two, you can use the processes of a proven business and utilize it to your advantage. The Epcon Homebuilding Franchise helps you scale faster by using a proven, repeatable model to develop entire communities versus building one home at a time. We give our Franchise Builders the plans, tools and resources they need to develop planned communities, allowing you to solidify your position and own your local market. At Epcon, we want you to take advantage of what we’ve learned appealing to the 55+ market for more than 30 years and match it to your business needs and goals.
One of our franchise builders, Scott Lehner with Perfection Builders says it best. “We tried to develop a product on our own. About half way through the process, we read an article in Builder Magazine about Epcon and drove to the nearest community. We learned they’d spent years developing their systems and thought it would be well worth the effort to join a franchise rather than taking years to fine-tune our process.”
What can I do to build smarter and more cost effectively?
Building smarter and more cost effectively is all about turnover time. With Epcon’s turnkey systems, you can get a home turned over to the buyer in as little as 110 days. This allows you to build more, sell more and save money along the way.
Our systems allow you to always build quality homes while also being extremely cost effective. One way we do this is by investing in a good quality assurance (QA) program. With a well-defined QA program, you can maintain construction quality, customer satisfaction and brand integrity – all things that help cut costs and build smarter. In fact, according to a study by IBACOS, an effective QA program could result in a 6:1 ROI. This study found that the average builder could save $7,200 per house by investing about $1,200 per house up front.
How are national builders able to pre-sell homes before they’re built?
The best way to pre-sell homes before they are built is to have a proven marketing program and sales training process. We have over 30 years’ experience crafting these programs and processes for you to utilize when developing your own communities.
Pre-selling homes is a process that starts early. It involves targeting the right individuals before you begin building through a lot reservation event to drive interest even before construction begins. From there, it’s about maintaining relationships, finding new potential home buyers, and marketing effectively. And Epcon has the processes in place that you can use to sell out before production is even completed.
Epcon also assists with identifying the perfect sales person or people. We have developed the blueprint of the perfect sales associate and help you with job descriptions and interview questions to bring these people onboard. Once hired, Epcon provides detailed training approaches and the process to close 2-3 homes per month. This has helped our Franchise Builders sign contracts before the construction of homes begins.
Still have unanswered questions? We’re here to help! Give us a call at 888.909.2430.
Please note that nothing substitutes for your careful review of the Epcon Communities Franchise Disclosure Document and we encourage you to carefully review the Franchise Disclosure Document with an advisor of your choice.
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