Small Business: Pimp My Garage

(2 of 2)

Successful garage-makeover businesses are also revving up growth through franchising. In 1999, Mark Loberg started PremierGarage, a company in Phoenix, Ariz., that remodels garages using goods he manufacturers and distributes. Loberg was a local entity until 2003, when he opened his first franchise in Hilton Head, S.C. Sniffing a market, entrepreneurs around the U.S. and Canada bought the franchises, paying $35,000 to more than $125,000, depending on the market size. Adding more franchises--now totaling 81 in the U.S. and Canada--helped PremierGarage's revenues soar to $16.2 million in 2005; the firm currently employs 82 people. Loberg, whose company charges between $5,000 and $8,000 on average for its projects, expects sales of $28 million for 2006.

The iffy housing market might be cause for alarm, but some garage remodelers see in it a signal for growth. Total housing starts dropped 6% in August, according to the Department of Commerce, and the pace of new-home construction was down 19.8% a year earlier. But, says Loberg, "if people stay put in their smaller homes when interest rates go up, it will be more critical to use the space available to them"--meaning bigger, smarter garages.

All the better for specialty remodelers, who can target deep-pocketed consumers like Mike Engel of Bend, Ore. When he decided to fix up his three-car garage, he characterized it as a "dumping ground and completely dysfunctional." So extreme was the clutter that of his three vehicles, he could fit only the Porsche inside. Engel contacted Mike Maxwell, owner of Garage Improvement, a Garage Envy dealer in Oregon, who completed the makeover this July for $15,500. Maxwell added stain-resistant rubber flooring, cabinetry, recessed lighting and a hot-and-cold water faucet so Engel could wash his cars. "Now it looks like a finished room--a place I'd want to go to hang out," says Engel. His once curbside suv and his boat fit comfortably alongside the Porsche--well worth the price of a little nip and tuck.