Jim Penman on Building Jim’s Group, Ethical Franchising & Australia’s Housing Crisis

Well, I am seriously considering making a run for the upper house of the state, Victorian state Parliament. Let's go on this issue because it is a real moral issue of seriousness and I don't think the majority of people in this state really want ultra expensive housing, ultra expensive rent.

Welcome to Whatever It Takes. We're joined here today by one of Australia's greatest success stories. And today's particular episode is all about the importance that franchise systems have played in the Australian economy. And the person that we have on the show today is someone who's been behind one of the biggest household names or franchises in this country, Jim Penman. And Jim has had quite the story to share and we're very blessed to have Jim on the show. Jim, welcome to Whatever It Takes. Good to be here, mate. There's so much to speak to you on. If I can just open up and just say you're very approachable and I feel like this is a great podcast. It's a different podcast I should rather say to what we normally have because I probably didn't expect it to be this approachable. So I just want to be grateful to you. You are giving us your time and for that we're very grateful.

Yes. Well, one of the things you got to recognize, I'm a lot more famous, that I'm rich. I'm not quite as important as you might.

No. But nonetheless, you know, it's you, you've got a lot of, lot of moving parts happening in your, no doubt in your day to day and so for that we're very grateful. Jim, why don't we kick off? Perhaps you can tell a little bit about your story. Where did Jim begin? The Jim's group begin and.

Yeah, well, start from the very beginning. I've done gardening since I was 8 years old. So this is a long time. This is, this is 65 years of gardening experience in the industry. But basically what happened is I went to university to do a degree in what turned out to be history, trying to understand the reason for the rise and fall of civilization. So about the furthest you can get from a normal business you could think of with the aim of becoming an academic. Now as part of that process, as my part time student job, gardening, mowing lawns. Of course, it pays pretty well, especially in your own business when you're mowing a lawn for sure and it's outside and you've got fresh air and you've got trees and grass and things. So it's a good, it's good balance. So that's how it started then I got to 1982, finished my PhD immediately, got it knocked back, I got it later. But there was no possibility of an academic career because my ideas were too wildly unorthodox. And not only was I not a specialist in any period of history but. But I come to the conclusion that the reason for the changes in history were to do with biology. So what I really wanted to do was to continue my research in an area that has involved with things like genetics and neuroscience and biology. So I have no training, no money, in fact deeply in debt and I didn't have any useful skills except I knew how to mow lawns pretty well.

I love it. I love it. And I guess to your point, I find that. I find that very true. On one side, you were on the academic side. But getting that balance of actually being out and about, I'll tell you what, that must be truly a good balance that you can sort of orchestrate in.

It was wonderful. It was great. I wished to work 52 weeks of the year. I didn't take holidays, I never liked that kind of stuff. But you'd spend a day or two working outside. Good money. Even bought a house as a result. But as a student.

So good. Yeah.

And it helped, made me healthier, more active and so forth. But then. So 1982 came along, flat broke, deeply in debt. Actually I just started mowing lawns full times and I built it up. I started building up and selling lawn mowing rounds. I put on subcontractors. Then after a few years a company called VIP came into Melbourne. Interstate lawn mowing franchise. Absolutely terrified me. I thought they'd crush me. I actually offered to join them. I actually said to them, I will help to build VIP in Victoria for you. I will help you to succeed. Because I didn't think I could compete. They said, no, thank you. So I went to the Franchising Expo in 1988 at the Old exhibition buildings in. I went up to the stands and I said, I'm very interested in vip. Can you tell me about it? And didn't ask me why I want to know. But he gave me all this information, gave me this brochure, walked away. I said, okay, what these guys have done, it makes sense, it really does. I can see a reason why you'd want to buy a franchise, why you'd stay with the franchise. But I reckon I can maybe do something that'll be better for franchisees. So I launched my first franchise in June 1989. Somebody asked me at the time how Many franchises I might have one day. I said, if it works well. I'm not sure if it will. If it works well, maybe one day I could have 100. That's what I said.

Wowzers.

Yeah.

Wow. And here we are. How many franchises are we at the moment?

Five and a half thousand.

That's incredible, Jim. That's fantastic. And how did the other divisions sort of come in? Was it just looking at gaps that grew over time? Was that kind of how your gym's building? Jim's test and tag sort of came along?

Services are very similar in terms of the way they operate, in terms of somebody ringing up or booking to get a job done, somebody going out and quoting. Whether it's mowing, cleaning, whatever, it's the same kind of thing. So the obvious thing was we've got this technology, we've got these computer systems and so forth we're developing. So let's try cleaning. What about cleaning? Now, here's the thing. This guy with the beard and the hat, this is a mowing contract. That's what I used to look like. We've got the hat on because I have fair skin, so I had to have something to protect myself. And you don't want a broad braided hat because when you're walking under branches, it gets knocked off.

Right.

So that's the hat.

That's the hat.

That's what I look like. So that's a gardening image of a gardening guy. Now, obviously, clearly if you got somebody as a cleaner, you don't want a gardening image, do you? Especially if it's a woman. It's completely inappropriate. So I developed this brand called Sunlight with little sprays and stuff. And they sold a couple of franchises, found I couldn't get the work for them, gave them their money back. I said, sorry, it's not working. Then somebody come to me and said, what about Jim's Cleaning? And I said, no, not going to work. They said, why not? I said, because it's a gardening image. This is the guy with the beard and the hat. I had the beard in those days. I'm not always wearing the hat. Yeah, and it won't work. And they said, we think it will work. And I said, no, it won't work. It cannot work. It's the wrong brand. It's a mowing brand. You can't transferred to cleaning. And they said, well, look, we're so committed to the work that we'll go into partnership with you. We'll actually put up the resources to make it going. So they launched Jim's cleaning. And it did work. You can tell because they go and approach somebody and start away from Jim's. Jim's Cleaning. Okay. Oh, toast the mine. Oh, yeah. Okay.

All right.

Give you a go. That's how it worked.

It was almost transferable because it has an origin behind it. Right. If you look at all the logos, that's. We know that it started somewhere. And I think with these other divisions.

You look at Virgin, for example, Virgin's a record store now. It's a cola, it's an airline, it's goodness knows what else.

Yep.

So brands are extraordinarily transferable. Once you've got it, it doesn't almost matter what you do with it, because the recognition is there.

Yep. Yep. It's a. I want to just switch gears here just for a quick second, because that's an unbelievably amazing story of how the franchise network came about. And in a second, I'll kind of go to what it takes to run a successful franchise. Right. But as you sort of built out this dream of 100 odd franchises initially anyway, what did that involve? Because, by golly, that's jumping from being a sole trader to something a little bit more scaled. Right.

Well, I always had subbies, and I used to blow up and sell lawn mowing grounds. So I knew something about selling businesses.

Yes.

So I learned a lot. Also, my first dozen or so franchisees were actually people I already knew, because what happened is I went to my best subbies. Most of them weren't particularly good, but someone that gave great service, I said to them, hey, I'll give you a real good price on a lawn mowing franchise, a Jim's Mowing franchise. And also, there was some people that I really had sold businesses to in the past, and I went to them and said, hey, but I'll give you a franchise. So I had my first dozen or so fairly quickly, and they were good guys. So that. That gave me a really good startup. I didn't start from nothing, even things like how you sell. Now, for example, I have very poor social skills. I am. My wife describes me as having Asperger's, all right, which very. I offend people easily. I get so obsessed. I've got that kind of thing. So I was terrible. So I was building up lawn mowing grounds and trying to sell them, and I was really pathetically bad at it. I was honestly, you could not believe how bad I was. I got to the stage where I would employ a professional salesperson to sell lawn mowing rounds sitting in this little backyard bungalow thing I have. And I'd be pretending to work on the computer while he did the selling. That's how little confidence I had in my ability to sell. And then I learned how to sell. And it was the most amazing and most important business experience lesson of my whole life. When I went to see somebody from my church who was in the advertising business, he was an advertising agent, had a successful business, much more successful than me. And I went to talk to him to ask his advice. And he invited me into his office. And for half an hour he told me about advertising. He told me about how to advertise, where to advertise, what kind of message, this kind of stuff, great media, all the rest of it. This guy Experience knew everything. The end of it. He said to me, jim, at this stage, you don't really need an advertising agency because, you know, you're just not there yet. And I walked out of his office and I knew that if I ever needed an advertising agency, I would go to him, which I did many years later when I went on television and stuff like that. But then I thought about. I said, what on earth has he done? He hasn't told me anything about his business. He hasn't shown me any of his clients. He hasn't told him what he's charged. He's told me nothing about his business. And he's completely sold me on his services. And I was walking quite a few steps, quite a while to get. My car was parked, which is a really unbelievably crappy old Holden Kinkwood. In those days, I never used to lock it because nobody would steal it. They might pick it up as being abandoned. It was the worst car. And as I walked back to the car, I was thinking about this. And I thought the only interest is Peter had was my welfare and the welfare of my business. And by doing that, he completely sold me on his business. And I remember just reaching out to the handle of the car, which was not locked. And I wonder if this could work for selling lawn mowing rounds. So the next time somebody approached me about buying a lawn mowing round, instead of talking about my business, I said, tim, tell me, do you know what the cut of a lawn mowing round means? Now, a cut is each job done once. If you've got 60 customers worth $80 a week, you've got a $4,000 cut. And the value of businesses in the paper was always based on the cut value. But most people, and you didn't know that. So I started talking about explaining what it was. I talked about the business, I talked about the kinds of earnings, I talked about how you advertise. Everything came to see me, I did the same thing. I just talked about the business, how you can be successful, even how you can start your own. I just. Everything I knew, which was quite a lot. Yes, because I was a successful main contractor. At the end of it, I said, I've got some customers in your area. This is a summary. Okay. That's my sales pitch. A little while later, somebody came to me. He rang me back and he'd been keen to see me. And he said, jim, I want some advice. And I said, sure. He said, I've been offered a lawn mowing business in my area, which is a better business, that one or yours? So he's asking me to recommend whether he should buy my business. So I said to him, okay, gotta be real about this. I said, okay, what's the cut?

Yeah.

How many customers? How far apart are they? How long has he had it for? What's he gonna be of success?

Yeah, yeah.

So is he getting out of business entirely? I mean, all these questions that anybody would know how to ask. At the end of it, I said, that's a better business. Go and buy that one. Even allowing for the fact that we replaced jobs, it was a better business.

I think there's something to be said around ethics of conversation, which I think is.

I got the same question three times in very short period of time. Each time, they asked me which was the better business. Each time, I told them to go and buy the other business. And the third time I said, that's a better business because it's more local. He's charging too much, offering this price. That's a better business for you. So I gave away three sales, but they all came back to buy from me, every single one of them. And as soon as they started taking that approach, I had no more problem with sales.

Wow, that's so good.

Now that is the greatest lesson I ever learned. So that when I started selling lawn mowing businesses, it was the same thing. What's in your interest? I would put people out on the road to. I would screen them and if they didn't do well in the trial, I would not sell them a franchise. And vip, Nobody did that in the industry. They still don't do it.

Just buy your spy your way in.

We scream, yeah. One of the. Somebody who worked for a company called Johnny King actually asked him once, he worked for me briefly. I said, what's your criteria? That you were told for selling a franchise, he said $50,000 at a pulse. That's what he was told by his supporters. So we had a policy from the beginning that said, I'm not going to take anybody, so that when somebody come to see me, they'd be questioning. I've been questioning them. So is your wife in favor of this? What have you been doing? Do you understand the problems with it? I would talk about the business I would talk to her about.

So good. It's amazing.

Suddenly this nerdy Asperger's quasi autistic guy suddenly becomes very good at selling because they stopped worrying about what I was going to get and started worrying about what the other person.

Yeah, correct. I was just about to say that. It's even in our discussions leading into this podcast, I've noticed that's comes along with your nature. And I think there's something we can all take away from. From that. I'm certainly got the Rain man happening right now on the other side of this table. In the sense that if you make it more about them, be ethical and. And also vulnerable, quite frankly, that's pretty attractive to knowing who we want to deal with. Right. So it is.

And you don't actually. In gyms, we have a name for it. We call it selling by not selling. It's the same thing. Look to the interest of the person, you're dealing with a customer, what's in their best interest. And sometimes divestitures may not even be doing what you want. A story about. This was a big hardware chain in America. I forget the name of it. You probably know it. But there was a story I was reading about where one of the big wheels of the business was visiting a store and a customer came up to him and said, listen, you've got somebody who's just cost you a lot of money. This worker, he said, because I'd gone in to pay several hundred dollars for something and he actually showed me how I didn't need it, and he could do the same thing for two bucks. And this big wheel, this manager said to him, tell me who it is, I want to see him. And the guy said, I'm not going to get him in trouble. I know he's cost you money, but tell me who it was. So he went up to him and shook his hand gratually. He said, well done. Because he looked to the benefit of the customer first.

Right. Makes him more memorable. Yeah, absolutely. I mean, here we are having a conversation about somebody else's story because it was memorable. Yeah, yeah. That's amazing.

I remember the name of the company.

Was what I know isn't a very big chain. It'll probably come to me.

Big, big American hardware chain. But I remember that story. It's the same idea. If you look to the interest of the person you're dealing with.

Absolutely.

That is the greatest power. And sometimes in franchising that means you've got to say no to somebody. Like we had one case of. A lady rang me about a problem with the contract and wasn't getting through. And she rang me and I started asking questions because this was done by one of my franchises, a sale, and she'd been to training, so she knew her. My contact details, my phone number and everything. And then I asked her about what I was doing. She said, I found out she was buying the business on behalf of her son, her son with his early 20s. And I asked why. She said, because he can't find a job. And I said to her, we're not going to sell your son a franchise. It's just not going to happen. Because that is a recipe for failure. You're finding the money and he's in that situation. No way. And she said, I really sorry I rang you. It's a big mistake. And I said, it's not. It's a very sensible thing you did. She said, what do I do? He hasn't got any work. I said, I've got a couple of guys in the area who are overloaded with work. Why don't they organize him to go out on the road with them and get a job that way, get a.

Taste and feel of the business as well.

Went out on the road with two guys, absolutely hopeless. There was no possible way this young man was going to succeed. Now, 10 years time, different experience, go to work for McDonald's or somewhere, get some life. Maybe, yes, but right now, no. So you've got to do the ethical thing now. I was so upset about that that when the regional franchise came up from anew, I said, you're not going to renew, you're going to sell. Because it was a basic breach of ethics to put somebody on that you must have known would have no reasonable chance of success.

Absolutely, absolutely. And I think that's a. That's a key thing for any business owner. I own a business myself. And whether you're enfranchised or not, it's being able to say, being able to say no when you need to say no. I gotta say, in the story of ybl, our digital marketing agency, it's now More of the no's that have helped me grow than saying yes to everything, which is what I initially did. So ethics play a big part in that, which I think is important to keep note of. When you see your franchisees come on board into the gyms group.

How do.

You pick them out to know that, hey, I mean, you gave an example there where that's not a good fit. Right. What sort of criteria do you normally look for in saying, hey, this guy Alvin over here might be quite good for us?

I don't directly do it myself these days. In the early days, I do all the screening myself. But look, there's certain things you look for young parents buying the business. Absolute no.

No.

You look at things like research. The more research somebody's done, the more questions they ask, the better the questions they ask. That's a very good sign. Is their partner in favor? If they're not in favor, your chances of success are a lot less. I want to put them out on the road and have a look at them, see how they go. Put them out with one of the trusted people who've got no financial interest in passing them. I have to say, we don't pay them to pass. We might take them out but we don't pay them deposit. So what's your opinion? And if they come back to me when say something like, I'm not sure, I say, if you had a second trailer you wanted to put somebody in charge of, would you put this person in charge? And invariably they say no. Well, that's that. Because we don't. We wouldn't either.

Yeah.

So you look at that. You look at the background. The steady the background, the more responsible position, the better. They've got to impress you. They've got to speak in a reasonable manner. Any sort of arrogance, any sort of refusal to listen, being late for an appointment and not apologizing, any signs of poor behaviour is good. When they come here, I don't directly screen people, but I always ask the staff in our conference center where you. We had lunch just before.

Oh, yes, yes.

I said, any problems? Anybody being difficult, Anybody being rude? We had one particular case of a person who came through. Now, this was not just for franchise, but franchise or trying to he rather crudely hit on a female member. Absolute no. Absolute no.

Yeah.

So you make the best judgment you possibly can based on those kinds of things. But look, most people who have got the nous to come up with money to buy a franchise have got sense. We're not talking about knocking out 90%. We're talking about knocking out 10, 15, 20%.

Yeah. I mean, the due diligence would have a part that'll have a lot of it to do with gut feel as well. But no doubt you got to do what's right by not just the group, but I guess, the end customer. Right. And who they're going to deal with and what that experience looks like with the customer.

Most of all with the franchisee themselves.

Yes.

It's a funny thing. See, one of the reasons when I start off, I didn't think I'd have so many. Like I have a competitor who's got 250 and I thought maybe 100. My feeling behind that was that I'm never going to grow as fast because I'm going to knock back a lot of people. But what I didn't realize at the time was that actually having a screening process is better because what it means is, is that when somebody was coming to me and basically saying, why would I buy from you? You're a smaller company, you're running it from your basement. They're established, they're interstate, they've got fancy offices. Why would I buy from you? I had a magic weapon. I had a list of my current franchisees with phone numbers. And I'd say there are some differences. I wouldn't bag the opposition. It's not a good idea. I would say there's some difference in working a different way. But here's a list of my franchisees with phone numbers. And this was decades before the franchise and co said you had to give it. Go and ring them, ring as many as possible. And then you go and ask for their list. Which I was being quite precious because I knew they wouldn't give them the list. The point of it is, when people ran them on my list, they'd say, yes. The great majority said, yes, it's working well, I'm happy. I get well looked after. Okay. It's a great experience. Not everybody, but the great majority will say, that list, that list, what did it? So when you put somebody on who's not suitable, what you have is somebody who's failing. And they're not going to blame the system. They're going to blame. They're not going to blame themselves, they're going to blame the system. And then they're going to say, this is a lousy system, it doesn't work. There's not enough support, there's not enough leads, you can't make money out of it. So your negativity. And they'll spread negativity to others and they'll tell everybody they've failed because Jimmy's is lousy. But even the fact that you're running a selection process actually is good because it actually means that instead of you trying to convince somebody to buy, they're going to convince you they're good enough to be in your business. They've got to convince me.

Yes, that's right.

When they go out on the road, they've got to feel that they're running a test. They've got to show they're good enough. Psychologically that's very different to selling. It's actually granting. You don't sell a franchise, you grant a franchise.

Oh, I like that.

Which people like McDonald's have done from the beginning and they do very well. I admire McDonald's, I really do. McDonald's is a great franchise and company. Disgusting, unhealthy food. I would not let my kids eat it. But as a franchise they are brilliant.

Yeah.

And My son, my 16 year old son is just starting work with McDonald's shortly and I'm delighted. I say don't eat the food, Aaron, but learn. These guys are good.

Yeah, absolutely. And speaking of systems, you guys have, in my opinion, and I've followed it for a little while at least through online and through my connections at BNI who have told me about the training here. That's quite a program, isn't it? Like you're dedicating a theater and you're talking through everything in a gist. What does that look like? What does the onboarding look like? What is the.

It's a two day generic talk. My first one is me. I talk for an hour and a half. I caught the gym's ethos. Service to customers, service to franchisees. What we're going to demand of you, which is very tough. The systems, how we get customer service, which is even tougher. Then I talk about what we do for you and how we help you and how you make that happen. All the strengths of the contracts, which are very, very strongly, give very strong rights to franchisees. For example, franchisees in our systems, they can vote out their own franchisor, they can change franchisors, they can veto changes to their manual. All kinds of rights they own the right to clients cannot be taken off them without their consent. They got an automatic right of renewal. There's a whole stack of stuff in there that protects franchisees very strongly. So I explain that system. Then you have other speakers who go on about things like about upselling and so forth and Bookkeeping and use of software systems and social media and a whole lot of topics really design every single one to say what can we teach you that will be the maximum help? At the end of it, I do the last session. It's about money. How to get more leads using our system, other ways, referrals, upsells, the kind of phrase you can use, and how to increase your hourly rate. That's the talk takes two days now. It works and we know it works for one simple reason. We used to have most service businesses you go into service business like cleaning or gardening. Your attrition rate in the first year is around about 90%, depending on what you read. But 90, 95%, around about that 5 to 10% will be there up to 12 months with us. Traditionally, statistically speaking, we lost about 17%, about 1 in 6 in the first year, which is better. But as soon as we put this course into place, our attrition rate dropped 10.5% straight away. So more than a third of the people we were losing in the first year, we were no longer losing. And that just showed the value of what we did. So we're always trying to improve that course. How can we do it better? Every course, it's the toughest course to teach in you can imagine because every attendee rates every speaker in that talk course, including myself. And then we look at those figures and we look at the comments on it. I read every single comment and every single person to know how we can improve.

Yes.

We just got a feedback today from New Zealand training. I just looked at that this morning. New Zealand training was last week and he went through and had a look at it. Okay, this was a problem here. This was the problem here. How can we improve?

Wow, that is fantastic. I mean, especially at the juggernaut size that this franchise group has gotten to, to still take time and look at improvement, that's pretty admirable. There's a lot to learn there.

That is the key to business, Alvin, as you know yourself. Yeah, it's not a case of starting off with the sharpest mind or even, even sometimes the hardest work ethic. It's that you got, you got to work hard. Obviously it's looking at your business every day and saying, how can I improve? The good people are the ones that constantly ask that question endlessly self critical. The poor ones are the ones that say if something goes wrong, it's not my fault, it's the system's fault, it's the client, it's the economy.

I agree, Jim. Yeah. Absolutely. Absolutely. Jim's has quite a presence in the networking community. It'd be remiss of me not to sort of talk about or as an area director of B and I myself, I get the pleasure of bumping into quite a few Jim's representatives almost every week, and I can see that it plays a real important role. I think we were talking at the cafeteria earlier, Jim's building inspections, there must be a couple of them that I'm just starting to see, are actually one of our biggest referral takers from the network. And so where do you think putting B and I aside and not isolating that in itself, but networking, how important is that for a franchisee, whether that be through chambers or whatever that might be, would you say? That's pretty critical in the journey of a franchisee?

It's very helpful, but it does depend to a certain extent on the nature of the business. Now, look at something like dog wash or mowing. They don't network a lot because they tend to get flooded with work very quickly. They don't need to. But you've got a business like building inspections, perfect example, conveyancing, bookkeeping, it. Those kinds of businesses test and tag. Those kind of businesses that need to directly approach people where they can't just rely on the leads flooding in. Networking is crucial. Now, networking can be bni, we certainly encourage that. And as you know, BNI is actually a sponsor and they come to every training. They have somebody here to attend because it's a very valuable thing. We even have a system that says that. We have a system called pay for work guarantee, so that, for example, if you are a mowing contractor and you franchise and you're starting up and you say you pay for work guarantees $2,000 a week. If you're not making that, you're going off of free services. Now, that's possible for that, but you can't do that for something like building inspection. You can't offer a free building inspection because it's a big thing.

Right.

So what we actually do is we have a system that says, okay, in this situation, if you do promotional activities, like if you go and talk on property managers and so forth, or you go to a BNI meeting, we will pay you to do it. Because we know that if you do that, you will actually pick up a lot more work in cash than it's costing us to get you to go there.

Absolutely.

So you pay people to promote themselves and networking is one of the best ways to do it.

Yeah, no, we've just found Jim's continues to be, at least in my region, which is Northwest, in Penrith, in Sydney. Gyms absolutely. Seems to be the group name that almost like every chapter, I speak to my presidents and my vice presidents, and whenever we look for a category that's missing or if there's a seat that needs to be there, it's not uncommon from say, oh, couldn't we get somebody from Jim's? Do we know anyone in Jim's that can kind of fill that seat?

So we've got a new division, Jim's Health Coaching, too. Oh, yes, I saw the life coaching.

Yeah.

Which is great. And we've got the first franchise. He's done very well. He's pretty much flat out, but largely within gyms. It's our internal network. Yes, but that is. That is where I'm actually. We're encouraging them to go to, first of all, to network within gyms, but also to network with groups like bni, because that's the way it's done. And once you start exposing people to your business and you start using services back and forth, it's very powerful. One of the problems we have with networking groups within gyms is that people who network successfully in these groups on the whole, don't do it for long because they get too busy. So networking is extremely important. In my course about income, I teach networking. I talk about networking as a very crucial skill.

It's such a personal business, Jim, that you've helped to deliver, but also that these franchises live and breathe with every day. And so nothing is as powerful, I believe, as this stuff and having that personal connection. And I guess in the senses of bni, in itself, it's regular and it means showing up. And that credibility is built over the year. And so I can see why you're such a big advocate of it. And there are plenty of networking groups that also would support, I would imagine, the network and life coaching is a very interesting new division for you. And for those that don't know, there was a. Interesting post from. From Joel about Jim's marriage counseling. If you don't know what I'm talking about, check out one of his most recent posts and you can work out the riddle there.

But yeah, it's a bit of a joke, actually. Well, thank you. I've been divorced three times, so.

That's right. You're probably one of their key customers.

If you want to. If you want to know how to be successfully married. Well, just don't do what I do.

Yes, absolutely.

It would be.

It would be remiss of me not to ask how many different divisions do you have and what's around the corner? I'd love to know. I mean life coaching is obviously a new division. How many current gyms based businesses do we have and how many do we have around the corner? Is there more to come?

There's about 50. Yes. We've got gyms towing we hope start soon gyms, epoxy floors, that's another one. That's there's the two most to me I can think of but I would probably get at least every week at least one person proposing a new division.

Yes.

And there's a process that we go through. Does it conflict with an existing division? Is it big enough because we need to work on scale because our fees aren't that high. You need about 20 franchisees to be viable. And then I look at the individual concerned, what they're like, what their background is, what they know about the business. Quite often a franchisee or somebody internally starts these new divisions too. Like laundry was start one of our cleaning guys and he achieved 120 franchisees in three years. And Bill, amazing guy, great, great mentor to other people. He's done so well. So we've got some exciting, we got.

Some great people and I think that's where it starts from. The thing I've admired from, from actually following Jim, your posts and everything like that online is just how in tune you've been with the way the world is changing. You guys haven't had an issue having a laugh at something or creating a meme on something or having an April Fool's joke about something. I think that makes, that makes us.

That's a lot of fun. Joel and I, we pack ourselves laughing doing some.

Absolutely.

The funny thing is that some people take it so seriously. I had a contact of mine who's a journalist with News Corp and he rang me up and said, he said jim, what's this thing about Jim's Airlines? And I said Jared, look at the date.

He said, oh so good, so good. And I think the group itself is so human I can only continue to see soaring success for you guys because it's so relatable. And I was telling, I was telling Joel earlier, I've been following his stuff for years and just seeing some of the, some of the posts around, even just being having conversations around mental health, I think that's, it's really good. It's not spoken about enough. But on that vein AI is coming in. It's probably the talk of the town if it's not already in 2025. How has AI and digitization of the business? I'm sure you've seen so much change over the decades, Jim.

It's starting to have an impact, actually. We just starting to think of how we can apply it. One of the most interesting things, if you go to jimpeman.com there's digital gym. So it's actually got over a million words, I think. I think a million and a half words so far. Everything I said. So if you ask it a question, it'll actually give for the most part a very plausible, reasonable answer which is in line with what I think. So that's fun thing about AI Jim's.

GPT coming out soon.

And Joel reckons by the time I've got about another 20 years left, by the time I'm gone, that'll be so good that you won't need to just use digital gin. And I call it a spirit.

So good. Is there any digital divisions coming up? Just I was interested to know.

Well, actually Jim's antennas is really Jim's Digital because most of what they do with things like connecting things up.

Yes.

Like for example, when they. If you want to connect up your. Your WI fi in the house, you get Jim's antennas or come in and they do it and they'll put up the screens and they'll loop them all up and stuff.

Yeah, yeah. Yes. I guess that particular business that's the biggest digital one. Yep, yep.

We'll probably do. Actually, I've got a guy coming from New Zealand talking about Jim Digital Marketing. He's actually interested in doing that as a new division too. It's just very, very early discussions, but Absolutely.

And it can probably help out the other divisions in many.

Well, that'd be a good one for you if we'd go ahead with it because that'd be a good one for networking for bni.

Yeah, yeah, that's it. We should probably have a conversation around that after this. But just looking ahead, Jim, I mean, it's outside of the controls that franchisees, franchisors and the leadership team has in the Jim's group. No doubt there's a lot of macro influencers that come in and come out. I know you've been one, not to mince your words about how you feel about government involvement. So I'd love to know, like, in terms of how business is being operated in the economy and its current state and what are your thoughts? I just like to kind of just open it up and go, hey, our franchises are the core Backbone of Australian. The Australian economy being business being well supported. Enough.

No, what's been done is pathetic. Look, they started inquiries into the franchising code many years ago and I've spoken to every, everybody that's ever said anything since then. And I said there's one thing you've got to do, which we've done ourselves. You interview, you poll every franchisee from every division anonymously. Confidentiality. And you post them in public. And then anybody who's interested in a franchise gets directed towards that site. Now, if you've got scumbag franchisors who don't look after franchisees, they would get killed so quickly. No bureaucracy, no paperwork. Now what have they done no to that? Absolute. No, not interested in that. What they've done is developed a disclosure document. Now, this disclosure document is so dense and legalistic that most lawyers can't understand it. I ask 100 people in training, has anybody read the disclosure document? Not one person put out a hand. Not one person has read this. It is an absolute gift and a godsend for the most exploitative, unscrupulous, blood sucking parasites you can imagine. Because all they've got to do is to put all the bad stuff into the place of women in a place they know perfectly nobody will ever read. They're covered against any evil thing they want to do. It is, it is a feeding frenzy for lawyers and bureaucrats. It is completely insanely unhelpful. I have never, ever seen any franchisee ever got anything useful for it. With one exception. They demand that you give a list of current franchisees with their phone number. Except I have seen one of these things from one of my competitors and they had the office phone number on every one. So it is pathetic. It is worse than a joke. It is massive bureaucracy. It costs us hundreds of thousands of dollars a year to do all the ridiculous things they're required to do. Changing these ridiculously unread disclosure documents. It is just farcical. The government's gone out there and said fundamentally, okay, what can we do that will screw over the business community but really, really be great for blood sucking, parasitical lawyers and let's do that.

Well, they've got to do something about it, right? I can hear the.

I don't know that they will. I've spoken to the CEO of the Franchising Council of Australia just recently. Yeah, and he's. I don't refuse to have any part of the fca, even though I'm supposedly on the board of honorable because I said you don't have any standards, you'll accept anybody. And that to me is garbage. You cannot have a proper association if you've got no standards. Now he is talking about doing some self regulation of the industry, possibly along the lines of what I'm talking about as an alternative. If that's the case, I'll 100% back him because I believe in ethical franchising. One thing that infuriates me is when people rip off franchisees and it's really up to the government to protect people. They only think their only concern is for the lawyers and the financial. You know, they say you've got to get your franchise contract read by a lawyer and someone to give financial advice. Well, let's face it. Okay, first of all, most lawyers don't know anything about franchise contracts, have nothing meaningful or useful to say. If you cared about franchisees, what you would say to the franchisor is you give your contract and you pay for it to be analyzed by an experienced franchising lawyer. And then that is given to every franchisee. Cost them nothing. You have one decent, knowledgeable franchising lawyer, give an opinion, comparative opinion instead of the whole people who don't know what they're talking about. It's completely meaning accepted as a way to keep lawyers busy.

And it's a. And you know, when franchises are starting out, I know I can speak for quite a few here. They're taking a huge risk given this thing though they have and they've probably taken everything they got out of it.

Yes, they deserve protection. And the government gives them stuff all, nothing. Yes, they make you audit the advertising funds. Well, for heaven's sake, we charge anything we like advertising as little or as much as possible. What does it matter about the audit? The audit though is at the expense of the franchisee that comes out of their money. So they're spending money to get work for themselves and the government says let's take a chunk of that and use it for an audit. How does that protect anybody? And even if the law, even if your contract is good, what does that mean in terms of how does it get looked after? Are you given advice? Are you giving help? Are you given enough leads? Would you do it again? Would you advise him? Those kinds of basic questions that never gets asked. But that's the kind of thing that a prospective franchisee needs to know.

Yeah. And probably earnestly wants to know and deserve to know.

The government should be about protecting ordinary people against rapacious, blood sucking, parasitical capitalists. And that's what they mighty will fail to do. And it makes me absolutely livid.

I think I can share that. I totally understand. My parents came here in the 80s. We're very grateful to this country. I certainly wouldn't have the opportunities I would have had unless the government and this country opened its doors up to Sri Lankans that were fleeing war. And my dad, when he first came along, Jim, he was. He was basically, lack of a better term, was. Was dishwashing. Right. But over time, for the jobs that are available, he just went for it and. But what he. What he evolved into is retail. And I've actually never stopped working. I probably shouldn't go on record for this, but I haven't stopped working since I've been about 11. And it's because my dad owned franchises, you might remember Camera House, rather Fletcher's Photographics. At the time he owned a Godfrey store. And even through it all, I think a lot of what you're sharing, it's funny because it really resonates with me some of the stuff that he's talked about over the decades and even today he's working with Carpet Court. So he's really a bricks and mortar sort of guy. And that's sort of the exposure I've got. So I think a lot of that passion that you're sharing, Jim, I can almost say that there'd be a good number of franchisees in various networks, not just in gyms, but anywhere for that matter, who probably feel like they need to be better supported and call to arms on the government.

I hear terrible stories. I hear really, really bad stories all the time. People who've been in other franchises, they've been terribly treated. I hear so many stories. I'm in touch with the Franchisees Association. I want to support them in any way possible. There's disgusting things going. It really makes me angry to see small business people being screwed. And the government sits back there and says, right on, go ahead and do what you're doing. We're in favour of it. Let you be screwed, because we're on the side of the big capitalists. I think it's evil.

Yeah.

And I think if you've got a government, a Labor government that's supposed to protect ordinary people, to do so little is a national disgrace. It is. But government does far more damage. Now, you mentioned immigration. Okay, yeah. We've done very well of immigration policy. But, you know, one problem we've got, we have a policy which says let's have a half million new people migrate to Australia every year, which I think is overall A good thing. I'm in favour of it. But the government also says let's use the iron hand of government to make sure we do not build enough houses to put them in.

Yes. Yeah. It's funny how they've come up with that equation, but they're not able to balance it out on the other side, what's actually needed. Right.

Let's stop you building enough houses. And then the price of housing goes up and up and up and up and up and up and up. Young people can't afford to buy a house and then they get mad about immigration. But immigration is the problem. Government is the problem. You know, Houston is an example of a city in America that has relatively relaxed zoning. The average house price in Melbourne and Sydney is around about. The median house price is about a million dollars. Just million dollars. Okay.

Yeah.

If we had the same, allowing for the exchange rate, if we had the same house price as in Houston, it'd be about half a million dollars. We pay double, double the cost of a house, the same house as they do in Houston, simply because the government makes it impossible to build. We live in a property. This area around here has a five acre covenant. I live next door. Five acres covenant. This is five minutes from the station, five minute from shops, five minutes from schools. Terrific place to live. One family in five acres. We should have 25, 30 people living on that, able to afford decent accommodation for themselves and their families and supporting local business. That's what we should be doing. It is absolutely outrageous the way the government impoverishes us. You've got some young couple, first of all, can't afford to buy a house. And then if they do, they're stuck with this huge mortgage burdening them down for years or even decades because government policy makes housing so expensive. And then you have even worse, you have people who can't afford to rent. The level of homelessness is directly related to the cost of housing, the cost of rent. You can increase homelessness to whatever extent you want by simply forcing up the price of rent. The government forces up limits on housing, pushes up the price of rent, and people are dying in the streets because they can't afford to rent, because government policy says you stay there and you die because we don't care about you. This is the outrageous thing about it. It also pollutes the environment because instead of allowing people to build what they want in the inner city with terror houses and multi story apartments and stuff like that, whatever they want to build, it actually is. No, if you're living next to the station. You've got to have a development that gives a car spot. I don't want to own a car. Doesn't matter. You've got to pay for it. I'd rather cycle to work. Doesn't matter. We don't believe in that. And if you can't afford to live there, then go and live two hours out in the country and commute two hours to work and two hours every home and never see your kids and belch billions of tons of carbon dioxide into the air because government policy destroys the environment.

Yep. More work needs to be done. I couldn't, couldn't disagree at all. If I look back and even the Sydney region is probably prime to all of this.

It's the worst.

It is the, the, the space of like 10km and you have this complete contrast that exists almost everywhere. I live in a place called King's Langley and, and just 15 kilometers away, if that. 10Ks, Jim. You've got people that are struggling in the housing commission world. It just. But 15k's that way. You've got Sydney. So it's really, really interesting. It's. I think the, the overall town planning to your point, needs to be taken more seriously. And just simply assuming that we're not going to build more houses is actually a really dumb thing to do.

Well, let's stop, let's stop zoning problems. That's the thing too, this whole thing. But you have to have a house on a block with a garden, not adjacent. Why? If you're in the inner suburbs of Melbourne or Sydney, why is that the case? Look, if you allow people to do what they wanted and everybody could live in the areas that are close to work and stuff, especially young people who don't necessarily want a lot of space around them. What that would mean is the people who really want something for their kids live a bit further out. But those houses are cheaper now, so it's more opportunity to live on the kind of house you want because people are not forced to buy there who'd rather live in a terrace house or a multi story apartment into the city. Everybody loses. The only people that don't lose from these insane policies is the people who've got multiple properties which are going up and up and up and up in value all the time at the expense of those who can't. You know, my daughter and her partner wanted to hire, rent an apartment, okay. Not even in the middle of the city or anything, just in Rewood. All right? They went to view one, there was 40 people there trying to get this apartment far out. And it wasn't even that cheap a rent. Now I actually said to the agent to give, try, give him a chance. I said I personally will pay a year's rent up front in cash, not literally cash, but upfront, if you will let my daughter have this apartment. Didn't get it. Now can you imagine how people who don't have millionaires for father, how they're going to cope with this? It's absolutely shocking.

It is, it is. More work needs to be done. Gosh, we could, I could learn so much from you and I love the passion that you share, Jim. It's almost like the voices that can't speak up are absolutely coming out through.

Well, I am seriously considering making a run for the upper house of the state, Victorian state parliament. Let's go on this issue because it is a real moral issue of seriousness. I don't think the majority of people in this state really want ultra expensive housing, ultra expensive rent. I think most people want moderately priced houses that even if they've got a house themselves, if they want their kids to be able to afford to buy.

A house, I mean that's what, that's what many of us are thinking about, right? I mean to your point earlier, what if you don't have that hereditary blessing? I've got a four year old myself and a lot of the moves that I make are bigger than me. It's about what I can, what I can build on as legacy.

And when your 4 year old want to buy a house, you'll probably be in a situation if you're a house, you'll probably be able to help them as I help my kids. Of course, but you shouldn't have to have wealthy parents to be able to buy. I bought my first house as a doing a law, as a part time lawnmower contractor and student. I bought a house in Eltham. $33,000. Okay. Just out of my earnings from my lawnmowing business. You could not even dream of that these days.

No, no, just that figure alone is crazy. Templestowe in that area to see what it's like now.

Prices were low in those days and I was mowing lawns for, you know, maybe I was charging 10 bucks for a lawn instead of 80 and stuff, but nothing like the comparison.

Absolutely, absolutely right. Jim, I've got to say we could probably keep on, keep on speaking about so many different topics, but you're a man of so much wisdom. I'm very graced to have you on the show as our viewers. No doubt are as well. We've definitely a lot to take away from. And just keep doing this amazing thing with Jim's group because you're inspiring a lot of the sole traders, a lot of the smaller businesses and you're giving them belief. You're building that belief. And I think the world needs more gyms and I think the gyms group will keep going.

Entrepreneurs too. Yeah, entrepreneurs. People come out and have a chance to say how great it is to be in a business for yourself and make that work. Yeah, most absolutely fun. It's the most absorbing career there is. Who want to be a lawyer or a doctor or an engineer when they could run their own business.

It's the best thing. I couldn't, couldn't attest to that more highly. It's been the best move that I've done and I'm excited to see what the future holds. So, Jim, from me to you, thank you for jumping on the Whatever It Takes podcast. Very grateful. And can anyone reach you if they have had any questions?

The other tims.net, there you go.

It's approachable. Thank you very much. Really appreciate your time. Awesome.

Thank you.