There’s been a significant uptick in the number of franchise owners who own more than one location. From franchisees who manage multiple locations in a specific territory to an investment firm that oversees dozens upon dozens of locations across several cities, opening more than one location presents an undeniable growth opportunity.
Like most business decisions, multi-franchise ownership boils down to capital and control. If one owns a franchise that operates out of a retail location, the growth path is from further development, as the more locations that are on the map, the more valuable a business becomes. Larger franchisees who diversify are better safeguarded to weather the storm of an economic downturn, as well.
What Is Multi-Unit Franchise Ownership?
When you become a franchisee, you own a single unit. Single unit franchisees pay a franchise fee and operate the business according to the franchisor‘s directions. If you want to take on multiple units, you could talk to your franchisor about signing a multiple-unit contract. Your contract may require you to open the units in multiple locations during a specific period.
Owning a sole franchise vs. multiple locations differs in day-to-day management. Owning a single location often means being on-premises daily; however, those who own multiple locations aren’t looking to be so directly involved; their focus pivots to growing their network of locations. This involves placing a manager in charge of daily operations while concentrating on the bigger picture of scaling their business. Instead of relying on the success of one location, multi-franchise ownership involves earning revenue from multiple franchised numbers of units.
What Are the Benefits of Multi-Unit Ownership?
In certain cases of multi-franchise ownership, a franchise can share expenses across several locations. If one owns several sites in one market, they can execute a marketing program that benefits all locations. They could also share personnel and resources, helping fill the gaps in employee scheduling conflicts or if one location happens to run short on inventory.
Some franchisors offer supply chain discounts when you open multiple units. If you’re a first-time investor, you’ll probably want to start with one unit and go from there. Once you’ve gained some experience, you could sign a multi-unit contract. As part of the franchise agreement between the franchisor and franchisee, you might get a discount on each additional unit besides the first one.
Franchise Scorecards: Bridging the Gap Between Data and Action Regarding Multi-Franchise Ownership
Multi-franchise ownership is undoubtedly an opportunistic goldmine; however, interpreting data across multiple locations — and using them in conjunction to secure business success — will be more critical than ever. It pays to have an enterprise platform that grants you valuable insight into your growth strategy.
Franchise Scorecards offers real-time analytics so you can keep track of your franchises in one unified area. Access our platform through your laptop, tablet, or smartphone to see how your units are doing throughout the day. You can view your sales, transactions, revenue goals, and other valuable stats that help you evaluate your performance.
Franchise Scorecards is a member of the International Franchise Association (IFA), enabling us to help franchises worldwide. If you’re thinking about taking on multiple units, don’t go it alone — partner with us. For more information, contact our team today!