Insight
Rutledge: Franchises are best owned by lawyers because they are purely contracts
“Franchises are best owned by lawyers because it's all contract.”
Insight
Rutledge: High California labor costs break fixed pricing models of national franchises
“In California, that same exact model that that franchise built, you need six people to do this volume in this place would lose money due to our cost of labor. So I'd have to figure out the franchise or model, but with maybe four people where they say I need si…”
Insight
Rutledge: Independent artists and professionals should get a degree in accounting
“If you're good, if you want to be a photographer or a violin player and you are going to be independent, get a degree in accounting. It just helps the language of business. It generally speaking, it's a very useful tool. Like I said, it's like learning Spanish…”
Insight
Rutledge: Accounting is a foundational dialect of business, not a numbers game
“Accounting isn't a numbers game. It's a language. It's like learning a dialect of Chinese. It's like learning Spanish. It's like learning French learn. It is the language of business.”
Insight
Rutledge: Neglecting data is a primary flaw of struggling expert leaders
“Getting into the data is not, is something I think a lot of people who have expertise but fail in leadership, that's one of the primary flaws they have.”
Insight
Rutledge: Service businesses lack SaaS scale and exits but offer strong margins
“It may not have the scalability or exit values of like SAS programs, which I know you have a background in and all that kind of stuff, but You can't argue with margin. It is definitely there.”
Insight
Rutledge: Hospitality franchisees are often trapped in expensive closed-circuit sourcing contracts
“They may find a like product for a lot less money, but the franchisor has a deal where they're getting, you know, margin on what you buy, and therefore you're in contract to get things, even if it's not in your best interest, or you have to buy the, again, spe…”
Insight
Rutledge: Franchisor fees often slash expected 30% bottom-line margins down to 10%
“Your bottom line isn't nearly what you thought it would be. You were expecting 30% and it's 10, for example, because of all the various ways you have to pay the franchisor.”
Assertion Not checkable as stated
Rutledge: Opening food franchise in existing space costs $500K to $750K
“So if you're gonna get into a Food business in general, you're probably at half a million dollars to actually get the business open with the percentage of that going to half a million to 750,000 dollars with in a non standalone location, meaning you're buildin…”
Insight
Rutledge: Passive franchise ownership by hiring a manager is a total myth
“The reality of a franchise that I think is a massive misconception is that it's so well put together that you just buy it and place it someplace and hire a manager and walk away. That's never the reality of these things.”
Insight
Rutledge: Selling a cash-flowing legacy restaurant is rarely a lucrative exit event
“There's something in the restaurant space where people who have developed a brand realize that there's not really an exit for the sale of the restaurant per se. But maybe they have a good legacy. So it's cash flowing. It's doing very well. But, you know, if yo…”
Disclosure
Rutledge: RDMS Group uses its accounting firm to drive other business ventures
“And truthfully, the accounting firm isn't our primary goal. It is the Sun to which all of our other businesses orbit. It draws attention. It gives us expertise, but it's really a great tool for us to grow our other businesses is how we utilize it.”
Insight
Rutledge: $100M business founders execute strategy in hours; $2M founders take days
“You know, you can see these people that are running a hundred million dollar businesses where he gives them something to do. And four hours later he gets it back. And then there's a guy with two million dollar business. It's going to take him five days to get …”
Insight
Rutledge: Regional franchises carry greater operational risk than proven national chains
“The national chains, like I said, more or less bulletproof in what the expectation is going to be, how it's supposed to run and what that's going to be. When you move into something maybe more regional, I think you have to be a lot more careful because you may…”
Assertion Supported
Rutledge: Chick-fil-A operators are full-time quality control workers, not true equity owners
“They use it as a quality control function. You literally, you know, myself and my business partner, we own multiple hospitality brands. We own a hospitality accounting firm. They would never consider us for a franchise unless he or I were going to use it as ou…”
Insight
Rutledge: Small business owners routinely fail to delegate their domain craft
“I am a marketer by trade. I'm unwilling to give the marketing responsibilities to the marketing person that I hired and is now on salary. It's not an uncommon story in most small business.”
Disclosure
Rutledge: Every business he operates is structured as a partnership
“I don't have a single business that I wholly own solely. Everything is brought into partnerships for that reason.”
Disclosure
Rutledge: It took two years to end 24/7 weekend client calls
“In retrospect, it probably took me the better part of two years to change the behaviors that I created from doing that and working with clients to be like, Hey, I'm growing. My company's growing. Be excited. I can offer you more, but my employee is going to an…”
Disclosure
Rutledge: Prefers systems execution and operational details over big picture strategy
“I realized I preferred having a more direct impact and getting involved in people who were focused on the details. I'm definitely a details guy. I'm a systems guy. I'm a builder of how to do things. I'm less the big, big, big, big, big picture, more the turnin…”
