If you’ve been able to make your franchise business a successful, profitable operation, adding another location may provide the perfect opportunity to double your success — and your profits. That’s why the most successful franchisees in most operations are those who operate multiple units. Whether you’re a single-unit operator who is thinking of stepping into the multi-unit category, or if you already have more than one location and are considering a larger expansion, there are several steps you can take to improve the likelihood of success.
1.Get even better. Are your current locations as good as they could be? Before you consider adding locations, fine-tune your business practices at your current locations. There are two reasons for this. First, you’ll improve the profitability of your current locations. Second, the lessons you learn by further enhancing your operations will give you a fresh look at the new locations and help you bring them up to your expectations more quickly.
2. Become a model. Every franchisor has particular operators they can point to with pride. Those are the locations the franchisor encourages prospective franchisees to visit and model their own operations. If you can run your business so well that the franchisor looks at you as the example of what to do, you’ll be in better shape for an expansion.
3. Shift your mindset. If you operate a single location or just a handful of locations, you’re probably a hands-on owner who frequently steps in and performs tasks right alongside the line employees. That’s an admirable trait, but if you’re going to scale up your business, you need to step back and become more of a CEO. Instead of a doer, you need to become more of a delegator, and instead of focusing on the nitty-gritty, you need to shift your view to longer-term strategy.
4. Take a leadership role. Most franchise organizations have owner committees that oversee everything from business practices to advertising expenditures. You might be hesitant to take time away from your own locations, but serving on these committees gives you a voice in critical decisions that affect your locations — and will have an even bigger impact if you add locations.
5. Support your franchisor. There’s inherent tension between franchisors and operators, and you’ll sometimes see that bubble over through operators who express frustration or make negative comments about the franchisor. When you disagree with the franchisor’s decisions, express your dissatisfaction privately. In public, be supportive of the franchisor. If you’re viewed as an ally (even an ally who can share criticism discreetly), you may be given opportunities that aren’t extended to chronic complainers.
If you’re ready to expand your network of locations, finding affordable financing will be critical. First Franchise Capital Corporation’s™ cash flow and asset-based financing programs are designed around the realities of franchise businesses, and may give you the most practical way to expand your network. Before you start shopping for a new location, have a conversation with our lending specialists, and you’ll get a better view of the opportunities available to you.
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The materials in this paper are for informational purposes only.