BusinessTN

Partners Tim Romeo and Bart Huckaby finalized in June the purchase of the franchiser’s interest in the multiple Checkcare franchises they owned. Their new company, TigerTranz, which provides check protection and electronic verification and processing of credit and debit card transactions, among other financial services, was previously the largest franchisee in the fold of Columbus, Georgia-based Checkcare.

COO Huckaby says the decision to part from the parent company derived from the fact that the partners were faced with growth-limiting franchise restrictions both geographically and in terms of the array of services they could provide.

“We could not go after the larger national companies under our old franchise agreements,” Huckaby says. “If we did, we had to share revenues with other, sometimes many other, franchises, and we found the bigger players prefer to use just one financial services company, rather than several.”

Romeo adds that TigerTranz will also be much more efficient given the recent consolidation of all operations into a single Chattanooga location. Previously, he says, the company had a needlessly redundant group of franchise operations in six different cities.

Richard C. Becherer, Clarence E. Harris Chair of Excellence in Business and Entrepreneurship at the University of Tennessee at Chattanooga, agrees that sometimes due to the cost of doing business as a franchisee “a spin-off might work out better.” But departing from a franchise agreement also has its downsides. Gone, says Becherer, are both some market visibility, as well as business systems that can make success a little easier. “Most franchisees stay with their original franchise,” Becherer concludes. “They must be happy.”

On balance, though, future growth for TigerTranz appears promising. The company’s 70-plus Chattanooga employees currently handle approximately 400,000 point-of-sale financial transactions representing $20 million in sales per month for its 7,500 client locations in an eight-state area. Romeo predicts the company will add as many as 2,000 new outlets in the coming year.

Part of that growth strategy hinges on nontraditional outreach. TigerTranz is already moving beyond the typical retail operation to provide the company’s services to city and county government tax offices and also to school systems in Alabama, Tennessee and South Carolina, which take in checks for such items as school lunches and activity fees.