Abrakadoodle Remarkable Art Education

Name: Mary Rogers Business: Abrakadoodle Remarkable Art Education Headquarters: Reston, Va.

Industry: Education Product/service: Educational Franchising Number of full-time employees: 7 Year begun: 2002 What was the challenge your business was facing as a result of the economy? Our franchise company Abrakadoodle, which provides art and creativity classes to children, was experiencing an increase in the numbers of students and programs but was stalled in franchise sales caused by the recession and a lack of capital. Consequently, our popular program was growing but was not reaching new markets.

What was the innovative idea you put in place? We looked for new markets in which 1) parents were spending discretionary dollars on services for their children and 2) there was a keen interest in investing in education and 3) companies and individuals were eager to invest in a solid franchise opportunity. The market we found was Asia.

What significant milestone has this innovative idea lead to since Jan. 1, 2009? Expanding to Asia has opened new markets for Abrakadoodle. This strategy has resulted in an increase in system-wide revenues from $3 to $5 million and has an increase in the number of franchises from 50 to 79. Franchise sales in the U.S. have also rebounded. We are on a growth path again.

Rating - 1 Rating - 2 Rating - 3 Good Excellent Superb! Please explain your innovation at greater length.

"Don"�t be afraid to color outside the lines," is the message we give students at Abrakadoodle Remarkable Art Education. But when the housing and economic recession hit our five-year-old franchise company in 2009, my business partner, Rosemarie Hartnett, and I decided we needed to follow that same advice.

Total franchises had stalled at 50 as sales slowed because most buyers used home-equity loans to finance their franchise purchase. While demand for Abrakadoodle arts and creativity education programs for children remained strong, we still relied on revenues from franchise sales. It was time to get creative.

We began by making the operation more efficient. Then we looked for new markets where parents were spending discretionary funds on services for their children. The most logical market was Asia. We had been entirely focused on U.S expansion but decided to take the plunge far away from home in the Far East.

We sold master franchise rights first in Singapore and Malaysia, and later in Japan, Indonesia, China and Macau. These rights allow the purchaser to grow franchises within their country/region. The new strategy required a drastic change in Abrakadoodle's business model to include retail locations. In the U.S., Abrakadoodle focuses on delivering mobile art programs by sending trained teachers, materials, curriculum and programming into sites where children are already receiving educational services: charter schools, community centers, private schools and afterschool programs. In Asia, with its denser populations, we designed Abrakadoodle Art Studios for Kids that are retail locations that can attract nearby students.

The strategy is paying off. Late last year, Japan's largest, publicly held franchisor of education programs purchased rights to Abrakadoodle programs. After being delayed by the tsunami early this year, the franchisor is kicking off the Abrakadoodle program across Japan this fall.

China was next. Last year, we co-branded with the Chinese owner of My Gym International Franchises, a U.S. company that has been operating in China. In June, Rosemarie and I "" along with Abrakadoodle's stuffed, black-and-white mascot dog Splat "" visited China to launch the program.

In Beijing, we met with over 250 Chinese moms and dads, anxious to learn about Abrakadoodle and creativity. While Chinese students have top scores in math, science and language arts, they lag behind in creative pursuits. The meeting and creative demonstrations went on for more than two hours as Chinese parents peppered us with questions. Already, Abrakadoodle China has opened 16 locations, with many more planned soon.

Expanding into Asia helped Abrakadoodle not only to survive the recession, but to thrive. Total franchises grew from 50 to 79 today, with system-wide revenues over $5 million up from $3 million in 2007. We expect to reach 100 franchises in 2012. From Beijing to Baltimore, Abrakadoodle has offered programs to more than a half-million children.

The international expansion led to new growth-strategies: co-branding and partnering with a well-established large franchise. We also have learned there are parents everywhere who want their children to develop creativity and imagination""and to color outside the lines.

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