Scout & Molly's goes the franchise route

Lisa Kornstein says she grew up a tomboy and was "never really into clothes."

That changed while she was getting her master's degree in counseling and took a part-time job at a store in South Carolina. She realized she could sell.

Then 25, Kornstein went on to open her first Scout & Molly's boutique in Raleigh, N.C. in 2002, offering women's apparel and accessories. The stores, named after her two Labradors, are now being franchised nationally, with 21 under development, including four in the Philadelphia area.

"What sets us apart is our level of service," Kornstein said. "We are like personal stylists, and our customers are more like clients."

Kornstein opened her second store in North Hills, N.C., in 2007, the third in Cary, N.C., in 2011, and a fourth in Columbia, S.C., last September. A fifth Scout & Molly's opened in Winter Park., Fla., on Sunday.

Scout & Molly's will open at the Glen Eagle and Paoli Shopping Centers, and a third is to open next year in Bryn Mawr. A fourth site is being scouted for 2017.

"My personal philosophy is, if you hold your head high and shoulders high, you can pull off anything," said Kornstein, now 39.

She has had experience holding her head high after being found to have multiple sclerosis in 2008.

"I realized that I had to make a decision. I could keep it a secret and deal it with it privately, or tell everyone and be known as the girl with MS," Kornstein said. "I decided that I was going to tell people . . . and somehow turn it into a positive."

The incurable autoimmune disease forced her to scale back her work hours to focus on her health.

"I was having a lot of tingling pins and needles and numbness on the right side of my body," she said. "My biggest fear was ending up in a wheelchair. The unknown was the hardest, because there is not a predictive part of it."

Refocusing her work life helped. "I was able to be more productive by focusing on the business side of things, such as strategy and the operation side of the business," she said. She hired a store manager and a bookkeeper.

She was already franchising the name at the time, but lacked the capital to take it national.

That's where Ed Samane, an investor and business owner - known for his Pro Martial Arts brand - came into the picture. The two formed a partnership to franchise Scout & Molly's nationally 15 months ago.

"I was impressed with his business acumen and his straightforward approach," Kornstein said. "I had the drive, but I was lacking the capital investment to take my brand to the next level."

There are only a handful of women's clothing store franchises, retail analysts say.

Kornstein said she used the model of Apricot Lane, another apparel store, in franchising Scout & Molly's.

"We are set up to allow owners to run profitable stores on a semi-absentee model, which allows them to continue to work in other fields or maintain their other jobs if they so choose," she said. "We also take a lot of the guessing game out of learning to be a retail buyer by offering choices of merchandise that have already been preselected by our professional buyers."

This is done by using JOOR, an online shopping platform for buyers and retailers, which built a division just for Scout & Molly's last year.

Investors are also provided their own inventory analyst to assist them with assembling a detailed budget for their stores' inventory each month.

The size of a typical Scout & Molly's is 1,000 to 1,200 square feet.

"We tend to develop aggressively in markets after we look at the designated market area's income levels, social economics, and other factors, and see if we can fit a Scout & Molly's," Samane said. "We like to go in a market at the grassroots level and build the brand."

Samane said outdoor shopping centers in upscale locations, such as Bryn Mawr, were the preference.

Brands in a Scout & Molly's include BCBG Maxxeria, Grazia dresses, Mason Limited T-shirts, and other designers, all ranging from work to evening wear.

"Any woman who wants to feel stylish, confident, and comfortable can find that at Scout & Molly's," Kornstein said. "The style is unassuming and very down to earth."

Founder:

Lisa Kornstein

Current number of stores: 5, in North Carolina, South Carolina, and Florida

Number of stores being franchised: 21, including

four in the Philadelphia area.

Typical store size: 1,000 to 1,200 square feet

Who are Scout & Molly? Kornstein's two LabradorsEndText