Multi-Unit Franchising Feature
As the franchising industry is ever growing, new and exciting opportunities continue to develop for franchisees to expand their business with numerous investments. The multi-unit franchise has gained traction over the last few years, with franchisees owning numerous units. Some investors will opt to continue their business and develop the same franchise within the same area. While others may buy multiple franchises in different locations.
Of course the more franchises one person operates, the more profit and money they will generate. But nothing comes for free - deciding to dedicate oneself to more than one unit takes time and money. However, it is an investment that can create great success with time and patience.
It is usually recommended that a franchisee become familiar with a franchise, wait to turn a profit, gain back their initial investment and then garner enough financial assets to buy into another one of the same franchise. Learn from the mistakes and successes of the first franchise, and simply replicate the process on the next go. This is the safest pathway to see results - but it can take a long time for those who are excited to grow their business. For the opportunists who are willing to take a risk and are confident in their ability to juggle multiple units, an investment in multiple units quickly could see multiple results.
The multi-unit franchise is an industry within itself that is diversified and ever changing. It used to be dominated by franchisees continuously buying the same franchise, but the idea of owning different types of franchises is now a growing trend. Once a franchisee has established a franchise (or sometimes multiple ones) within a location, the idea of opening a totally different franchise is now a common practice. Historically, franchise investment used to come with protected territory clauses, which prevented franchisees from investing in competitors within a certain distance, but franchises are starting to drop the typical exclusive trends to adhere to the changing desires of franchisees. That being said, 88 percent of multi-unit franchises are in one brand - which could be proof that the typical standard practice is what’s best, or that it’s the safest way to become a multi-unit franchisee.
The focus of multi-unit owners differs from those who only have one franchise. A single franchise can involve a more hands on approach, with the franchisee having the ability to be a lot more involved in the the everyday. The single franchisee also allows owners to have a lot of flexibility, and more control over their work life balance. Those interested in owning multiple franchises are truly focused on gaining more business and growing their investment. They are operating at a much larger scale with a more observational distance approach.
The workload will change as well. Obviously, if the business grows, the time and work needed to keep it afloat will grow as well. A willingness to be an integral part of the franchise and a passion for business would help garner success. Multi-unit franchises present owners with more work, but for those who enjoy planning, envisioning business trends, forecasting and being a leader in multitasking, being a franchisee of multi-units can truly give them a sense of fulfillment.
If you are interested in owning a multi-unit franchise in the future and haven’t started your franchising journey yet, it would be wise to do some due diligence prior to the initial investment. Some franchises have greater opportunity for multiple ownership, and are purposely built for franchisees to continue growing. In fact, some franchises are invested and more interested in multi-unit owners. However, some of the multi-unit focused franchises are only willing to invest in well-financed individuals - research into the expectations and requirements that would be needed by a franchisor would help narrow down options. Depending on your background and experience, a multi-unit corporation could be well within the wheelhouse of those interested in multi-units.
Consider and review the success of a franchise with past multi-unit operations. A business with a historically healthy background of success,would be less risk, while a new upcoming franchise that is fresh to the multi-unit scene may have less requirements or necessities.
When it comes to investment, some franchisors seeking franchisees who are interested in growing their business may have a discount to offer for secondary units. It’s also recommended to review the support offered to multi-unit franchisees - what kind of services are available to those who open another business? Is there training available on how to run more than one unit or only the original training offered ?
A franchisor that has an operational system laid out specific to multi-unit franchisees would be a bonus and extremely helpful for success. Throughout your research, look at how units communicate and prioritize. If you run into a problem at both locations that requires your presence all at once, how would you determine the approach in such a case?
Multi-unit franchising can come with a lot more red tape than a single-unit, between the provisions and qualifications needed by the franchisor to trust a franchisee prior to the initial investment, there are also expectations needed in order to move forward with a secondary operation. It would seem as if a franchisor would only need to review the profits of a unit to move forward, but there needs to be insurance that a new similar business will not harm the current one or that they won’t both fail from using each other's ressources to stay afloat. It’s also expected to have a fully functioning unit that has reliable and trusted staff, without a lot of turnover that can be trusted to run the place while you are launching another business.
For those looking to grow their business, as well as looking for new and big opportunities and a challenge, a multi-unit would be a great option. The groundwork is more detailed and more extensive than a single-unit investment, but the work pays off. In fact researching a business from the get-go to see if a franchise has the qualifications to multiply would be helpful initially. A distinct review of support and past successes, as well as discussions with other multi-unit owners can build the road to choosing the exact franchise that suits the investor and guarantees success.
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