If you have the background , experience , and drive to take on these challenges , then multi-unit franchising offers you a path to achieve your dreams .
If you have the background , experience , and drive to take on these challenges , then multi-unit franchising offers you a path to achieve your dreams .
hard work , and fraught with failure . Successful multi-unit franchisees must do at least three things well :
1 ) You must be able to finance the additional locations / territories . That means deep pockets , or at least access to deep pockets . This often requires business partners and / or lenders who then have skin in the game and can influence the way you conduct your business . This is an important reality to keep in mind if you are an independent thinker and operator .
2 ) You must be able to form an organization with a management team and infrastructure to command your expanding empire . You may be able to remain handson with a handful of units , but when you reach 10 or more it ’ s no longer feasible for you to oversee day-to-day operations . At some point , you will need to bring in a team to handle everything from operations to finance to marketing and HR . You must learn to delegate and get out of the way .
3 ) Leadership is the final ingredient . You come to the game with vision , ambition , and inspiration . The challenge is communicating these crucial intangibles to your expanding organization and keeping them intact as they filter down to your unit managers and front-line staff through your in-house team . Necessary and achievable ; never simple nor easy .
If you have the background , experience , and drive to take on these challenges , then multi-unit franchising offers you a path to achieve your dreams . But you can ’ t do it alone . Rely on people , partners , and delegation — plus a large helping of your own passion , patience , dedication , and hard work — and yes , you can grow a multi-unit empire .
SPREADING THE RISK
Multi-brand franchising allows multi-unit operators to balance risk and ride out the uncertainties of the marketplace in many ways :
Economic cycles . Operating brands in different industries can help minimize the ups and downs of an uncertain economy . Casual dining as a segment took a huge hit in the recession , while bargain-priced fast food continued to do fairly well ; new car dealers suffered while automotive maintenance and repair businesses held their own and expanded .
Seasonal cycles . A lawn care franchise in a four-season climate slows to a crawl in the winter . Ice cream , lemonade , and frozen desserts peak in the warm weather , so why not add soup and sandwiches as the weather cools ? Adding a second business to balance out the seasons will keep employees engaged and the cash flowing in . New brands can be in related sectors ( maid service , electrical , plumbing , home insulation ), or in completely different areas ( food , rental centers ).
Cash flow . A franchisee with several units of a casual restaurant brand ventured into rental stores . Stocking a new rental store with merchandise is expensive , and monthly rental fees don ’ t cover the purchase price for 6 , 12 , or 18 months , tying up valuable cash in inventory . The daily cash flow from the restaurants was the perfect complement to keep the organization healthy until the rental stores started showing a profit — which they did handsomely in time .
Day parts . Breakfast , lunch , dinner , late night , and in-between . Whether it ’ s food or services , consumers and businesses have needs 24 hours a day . If your business makes the majority of its sales at breakfast and lunch , adding a brand that peaks in the afternoon and evening will make for a longer day , but also a stronger bottom line .
Surprises . Fast food operators have been hit hard over the years by news of salmonella , E . coli , employee misbehavior , and other developments beyond their control . Having other brands in your portfolio can help you stay afloat until a negative situation is remedied and trust in the brand restored .
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