TWST: Could we begin with a brief historical sketch of Swisher International and a picture of the things you're doing at the present time?

Mr. Reeder: Swisher has been in business since 1983, when the company started just doing a hygiene service for local customers ' industrial and commercial businesses here in the Charlotte area. We started growing and expanding outside of the Charlotte area through the years after that. In 1990, we had 18 company operations that were located around the Southeast, providing hygiene services and products to commercial customers. In 1990, we started franchising our business and today we have approximately 120 franchise operations in the US and Canada, and we also operate in 22 other countries around the world, by way of master franchising.

TWST: What would you say were the key elements in the success of the company?

Mr. Reeder: There are a couple of things that contribute to this. The first would be that we were moderately successful back in the late 1980s in opening company operations, but the fact is that if I've got a company operation in Pittsburgh, Pennsylvania, run by an employee, then my ability to manage the growth of that business from Charlotte, North Carolina, is not as efficient as if I have a franchise owner ' an individual with an ownership stake in that business. We transitioned during that time from a management company to a franchise support company. Here in Charlotte, we engineer all of our administrative, ' and I'll get into that in a minute ' sales and service support functions that help these entrepreneurial individuals who own their own small businesses, grow and make money. That was the first key piece of it ' establishing a local ownership presence in these markets. The second piece of it ' which I think is the most critical piece ' is the fact that Swisher provides a unique package of hygiene services and products to the customer. Because of the unique nature of this combination of services and products, there are virtually no direct competitors for our franchisees. We are definitely not high tech, anywhere on the cutting edge of technology. It's just a good, basic package of service and product. The customer is already paying for hygiene products; in most cases we can take these dollars and redirect them into the Swisher service solution, give them more for the money they are already spending. When the customer takes the Swisher program, our franchisees will send in a service technician on a weekly basis. To my knowledge, Swisher is the only company in the world that performs these kinds of services on a weekly basis. This gives the customer the ability to cut their maintenance costs in the restrooms. Swisher is not a cleaning company, we are a comprehensive odor-control and disease prevention service. We accomplish this by sending the technician into the customer's restroom facilities every week with a specialty kit of chemicals and a process where they can go in and sanitize all of the porcelain fixtures in the restrooms ' the bowls, the urinals and sinks. That is primarily where bacteria and germs, the cause of unpleasant restroom odor, breeds. After the technician performs that service, each fixture is then coated with a hospital grade germicide, which contains a residual agent that will kill bacteria and germs that come into contact with it anywhere from five to six to as many as seven to eight days. So by the time our chemicals are wearing off the fixture, our technician is back again to re-perform the service. Swisher becomes very cost- effective to the customer, because we provide all of their liquid lanolin-based hand soap and dispensers all around their building ' whether it is in the restrooms or in the kitchen areas of restaurants and food service facilities. We put air fresheners in each restroom, which make it smell nice. When you walk into a Swisher restroom, you have that nice lemon or floral or cherry smell, that's really our signature. So we've taken care of what creates the bad odors so that the air freshener can do its job and not mask odors, but put a nice scent throughout the restroom. There are a lot of other products that these businesses are having to purchase ' janitorial products, like cleaning supplies, urinal screens in the men's room, toilet tissue, hand towels, seat covers ' all products which are provided through the Swisher service solution. The technician's there every week, so the customer can purchase from us exactly what they need for that week, eliminating the need for them to keep storerooms full of janitorial supplies and paper products. This eliminates inventory, pilferage and waste. This makes us very cost-effective for the customer.

TWST: Is anyone providing services comparable to these?

Mr. Reeder: There are other companies that strictly sell hygiene products. There are janitorial and cleaning services that clean the entire buildings. But there's no one that is able to perform the specific and unique hygiene service that we perform. It's very commonplace to walk into an office building or a nice commercial business like a restaurant or retail store, go in the restroom and it looks clean, but it doesn't smell real good. That's because the cleaning person or janitorial service doesn't have the know-how and the products that we do to take care of what's creating those odors. Now, beyond the cleaning and the sanitation of the fixtures that Swisher provides, we also have what is called the SWAT service, which is our Swisher anti- bacterial treatment. Here we put an FDA-approved germicidal mist throughout the restroom which will coat the walls, the floors, the ceilings and kills all the bacteria and germs that would cause transient odors that may not be coming from the fixtures in the restrooms. We also take care of transient odors, which originate in floor drains and other plumbing fixtures by introducing a bacteria product, which digests the odor-causing grease, which has accumulated in these pipes. Swisher franchisees also have the ability to now provide their customers with a chemical rack program which gives primarily the food service facility weekly access to dish soaps, sanitizers, floor and general purpose cleaners, which they have previously had to purchase in bulk quantities. The newest service offering for Swisher is a weekly commercial pest control program, which we are very excited about. Combined with the other Swisher Hygiene services and products, such as toilet tissue and paper towels sold weekly by the roll, this truly makes us very cost-effective for our customers.

TWST: What do you hope to accomplish over the next two or three years?

Mr. Reeder: What we hope to accomplish is to continue to expand our customer base and our range of services and products that Swisher franchisees provide to their customers. The overall sales volume of the Swisher system gives us the ability to bulk purchase hygiene products, which our franchisees can re-sell to their customers at a real value. For example, there are a lot of incidental products in the Swisher service solution. If we're providing service, for example, for an automobile dealership or a print shop or a place like that where you have mechanics or people who are getting grease and oil and ink and those kinds of things on their hands, we provide the industrial hand soaps to do the heavy duty cleaning. Again, being able to purchase weekly on an as-need basis keeps that customer from having to buy 55-gallon drums or large quantities of this particular type of soap. Again, that saves them inventory, pilferage, waste and keeps their costs down. If you were to interview an average Swisher customer, they would tell you that they don't make money in their restrooms, but they can sure lose money in there. Swisher is like a cheap insurance policy for them. We know that when a customer uses their restroom, it will not be an unpleasant experience. Not only are we a value to the customer, the fact that the restroom is a sanitary environment is a major intangible for them.

TWST: What are your thoughts about the business overseas?

Mr. Reeder: Swisher operates through master franchising in a number of countries in Europe, the Pacific Rim, Australia and New Zealand. As a matter of fact, the largest volume single unit franchise in the world is not even in the US or Canada. It's in Hong Kong. They're currently performing between $4-$5 million US- equivalent worth of yearly service. It's a program that works well in most parts of the civilized world. We have some very strong, master franchise operations around the globe, and it's our goal to continue to expand our service and product program overseas when we can find a good partner in that particular country. When we set up a master franchise, what we're doing is establishing an individual or company there who's going to basically be the alter ego of Swisher corporate here. They're going to set up an operation in their country which will sell and support franchisees as we do here in the US and Canada. We will, of course, receive an on-going royalty on the sales of that operation.

TWST: Are there any thoughts of diversifying and offering services beyond the restroom service?

Mr. Reeder: Absolutely. Every day, we're looking at different types of services and products that we can sell and service though our vast customer distribution system. One of the reasons our franchisees have such unlimited growth potential is that Swisher is a comprehensive support organization for the franchise owners. We provide all the administrative support for our franchisees here in the US and Canada, along with the franchisees in Australia and New Zealand. What we do for them is create all the weekly invoices for their customers. We're very heavily into corporate America including chain accounts, major fast foods like Burger King and Taco Bell, major oil companies like Exxon, Citgo and many, many others. Swisher does all of the monthly billing to their corporate offices and to their regional and local payables offices out of here on behalf of all Swisher franchisees. This support function is very desirable for Swisher franchise owners. One chain of fast food restaurants or oil companies distributors or convenience stores may spread over five or six or as many as 25 Swisher franchises that are servicing their locations. In these cases the billing for that chain has to go to one central location. These corporate entities do business with our franchisees because they only have to deal with one company, Swisher. They're not dealing with a bunch of individual business owners and because we can send one statement out and handle the billing and collecting on behalf of the franchisees. Swisher sets up the billing programs to meet their corporate specifications, and then collects and disburses the funds on behalf of our franchisees so these companies don't have to deal with 25 different bills coming in. The transaction costs would make it very difficult for these large companies to deal with our franchisees as individual businesses, but because we handle all that, it makes it easy for the franchisees to do business with large corporate entities. That has been a very dramatic factor in the Swisher system being able to grow and develop many corporate relationships. Swisher maintains one of the largest collection agencies in the area here in our corporate office in Charlotte. We handle the collection activities for our franchise owners with their customers. This alleviates them from having to spend a lot of their time out trying to collect money for their services. The franchisees can spend their time out taking care of their customers and adding new customers to their business. Because we handle all the back office support for the franchise owners, it allows them to build their business and provide a better level of service to the customer.

TWST: Whose job is it to find new customers ' yours or the franchise owners?

Mr. Reeder: We work in tandem with our franchise owners to do that. Swisher maintains a national sales force that is managed out of our corporate office. These people are located all over the country and they work with our franchisees to help them develop, hire and train a local sales effort for their business, but also work to obtain corporate and chain customers for their franchise. So it's a joint effort.

TWST: What would you say are the major opportunities and challenges that lie ahead of the company?

Mr. Reeder: I believe that today, for the US and Canada, we send out close to 70,000 invoices a week, so that pretty much is in tandem with the number of customers that we're servicing here. That number continues to grow at a double-digit percentage every year. But the opportunities for the company are that as Swisher continues to expand the service and product offering through its franchisees to the customer, it allows us to be more of a benefit to different types of customers ' whether it is food service, industrial manufacturing plants or commercial buildings. Our franchisees provide service to a lot of commercial properties ' office buildings and that type of thing. Even though a very substantial percentage ' probably close to 50% of our total customer base is food service-related, because they have the highest traffic through their restrooms ' the diversification of our service and product offering is allowing Swisher to open up more new markets every day. Swisher maintains a purchasing and research and development department here at the company that does nothing but work toward developing new products and services to offer to the customer base. If it is something that can be marketed and serviced through our current distribution system with our franchises, and it's something that the customer needs and we can provide at a value to them ' then everyone wins. Because of the size of the Swisher system and the fact that we probably do have, worldwide, in excess of 100,000 customers and that distribution network continues to get larger and larger, what happens is, the ability for the company to purchase and/or develop these products in large quantities keeps the cost down to our franchisees and allows them to market those products to their customers at a value. For example, the Swisher system is probably the largest end-user of soap products in the United States. That purchasing power allows our franchisees to be able to offer that product to the customer for a real value.

TWST: Do you foresee any problems arising for the company?

Mr. Reeder: Again, the good here is that the Swisher service solution is very cost-effective to the customer. We can't see technology taking the place of someone coming in and performing this type of service. Technology is going to be hard pressed to replace what we do. The fact that we're very cost-effective means that even in a soft economy our service and our customer base continues to grow, because we generally save our customers money. When they look at what they've been spending on hygiene products as opposed to bringing us in with our package of services and products, it makes sense. At this point I'm very excited and optimistic about the continued growth of our system, and really the challenge for us corporately is to continue to recruit good business people as franchise owners and then provide the highest level of support and product offerings to them so they can build their customer base locally.

TWST: Is the franchise owner typically going to do their own work?

Mr. Reeder: We're recruiting business people, good people who have the ability to build, with our help, a sales and service organization. What they're doing is somewhat like what the vending companies do ' they're establishing routes. Unlike the vending companies, which will sell off those routes, our franchisees will hire service technicians to run the routes. The technician is then paid a percentage of the revenues that they generate on their route. This incentivizes them to help provide more products and services to their customers, because the more they provide to the customer, the more money they make. We train our franchisees to hire, train and manage sales and service people. We then support the process.

TWST: Where do you expect Swisher to be, let's say, three years from now? What might be some of the milestones you will pass along the way?

Mr. Reeder: One of our milestones has always been to try to accomplish getting to 100,000 plus customers here domestically, and I think we've got that within our range. We can see that happening in the next few years. We have good franchise owners in a lot of the major markets in the country already, but we do have some good available markets left that we'd like to put some talented business people into as franchise owners. But the company's focus is always customer-oriented. If we can continue to build a package of service and products that is of benefit to the customer, then we all win: the customer, the franchisee and the company. So our focus has always been and always will be on how we can best satisfy the customer and provide more services and products to the customers that they need and receive at a value.

TWST: Do you feel that the investment community understands Swisher as well as you would like it to?

Mr. Reeder: Our business is very conceptual, and that's why you don't see big billboards on the highway that advertise Swisher. If you stop someone on the street, there's a chance that they've seen us and they recognize the name because when you walk into a rest room that we are servicing the Swisher name and logo is on all the soap dispensers and air freshener cabinets. We put a red label on every fixture that states it has been sanitized by Swisher Hygiene. That tells that customer's customer that something good has happened in the restroom that's for their benefit. So while most people recognize Swisher and we've got very good brand identification, most people don't understand exactly what we do and how we do it. Even though we have a very high profile at most of your major trade shows, whether it be grocery stores, convenience stores or national restaurant shows and those types of things, we don't do direct advertising to the public because it's hard for the investing public to understand, conceptually, exactly how we do what we do and why we do it. They just know that when they walk into a restroom that has the Swisher logos in it that it's clean, it smells good and they feel good about using it. That's the most important thing.

TWST: Would you give us the three or four best reasons why a long-term investor might want to consider Swisher?

Mr. Reeder: Swisher has a very solid history of growing the business and that is the main thing. We continue every year to add new franchisees, increase the customer base and open up new markets. The corporate account base is growing very quickly because of our widespread franchise coverage. We can go in and service most of their stores. And yet, there are still are a lot of good franchise opportunities in a lot of markets around the country and internationally. So the company will continue to grow aggressively, both domestically and internationally. The international markets are more of a challenge with world events as they are, but we have excellent established master franchises in many countries and continued interest in our international franchise programs. As a matter of fact, something came across my desk yesterday. The country of Germany for us is split into three different regions. We have two current master franchises there and someone is inquiring about picking up that last piece of the country. So we feel, even in today's international environment, that we'll continue to grow because people see our success in the countries that we're in and they want to take it to where they are.

TWST: As Executive Vice President, what occupies most of your attention day by day?

Mr. Reeder: Day by day, basically, my main focus is to continue to fuel the growth of the company. That will come by continued expansion of our franchisee base, and helping to give our current franchisees more products and services to provide to their existing customers. I try to focus on every different way that our company can grow and prosper and try to enable that to happen. Again, that comes by listening to your customers and listening to your franchisees and, of course, I'm actually an owner of two franchises myself. I have a partner who runs the day to day operation, but there are many days of the month that I will leave the office early and go and visit customers, just to see if the value of what we're doing for them is still perceived there and it almost always is. But most importantly, asking that customer what can Swisher do for you that we don't do now that would be of value. Anything that we can do to continue to help our customers helps us.

TWST: What does the company do to get its investment message out to shareholders and potential shareholders?

Mr. Reeder: At this point, we are a non-reporting public company. We do stay in touch with our shareholders. We are taking the approach that if you keep your head down and work hard and grow your business and your numbers, eventually, somebody is going to notice what you're doing.

TWST: Is there anything that you would like to add?

Mr. Reeder: The main thing that I would want people looking at our company to focus on is Swisher Hygiene's track record, its growth, stability and low turnover in the base of franchise owners, the ability to expand its markets and to provide what the customer is looking for, even though that customer probably didn't understand they were looking for Swisher before we got there. A Swisher salesperson will go out and they're not the fifth or sixth or 10th or 12th person that week sitting in front of the potential customer trying to sell them a comprehensive restroom hygiene program. It's a very unique, niche business, but it's not on the cutting edge of technology. It is something that is very basic that works. I don't believe that we have much competition, simply because we set out to build out our business this way many, many years ago through that basic weekly service. Most service companies around the world don't have the ability to do that. Our technicians are there every week at that customer location providing service, product and building a relationship with the business owner. That is what makes us unique and what continues to fuel our growth.

TWST: You mentioned that the company is not high tech. Would that mean that the barriers to entry are not high?

Mr. Reeder: The barriers to entry are not high, but the ability for someone to come into our business and compete with our franchisees, number one, they don't have the products and the know-how that we do to perform the primary service. Number two, because we are the largest company in the world at what we do, our ability to give our franchise owners these products and services to sell at a value to the customer, is something no one can do. Several large companies ' I'm not going to mention names because that wouldn't be the proper thing to do ' some very recognizable companies have seen our success and tried to enter our business and compete. Every single one of them failed because it takes a lot of knowledge and a lot of time to build this weekly route service business from the ground up. This is the 20th anniversary year of Swisher and the business was built very methodically over all those years.

TWST: Thank you. (MC)

W. TOM REEDER Executive Vice President Swisher International, Inc. 6849 Fairview Road Charlotte, NC 28210 (704) 364-7707 (800) 444-4138 - TOLL FREE www.swisheronline.com

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