Multi-unit franchising is becoming increasingly popular, as investors take on the thrill of owning more than one franchise unit. The system comes with its challenges, but can also provide high earning potential for those who establish a successful business network. So, how can you be sure you’re ready to run a multi-unit franchise?
Coming across a multi-unit franchise owner was once a rarity, but now over a third of franchisees in the UK own more than one franchise branch. In fact, the percentage of investors managing multiple businesses rose from five percent in 2013, to 30 percent in 2015, to 36 percent in 2018 (BFA-NatWest survey).
Business growth is the principal objective for most entrepreneurs, but prospective investors shouldn’t underestimate the challenges of the multi-unit system. It takes a particular kind of franchisee to see success with the business format, so it’s worth making sure you’re ready to run a multi-unit franchise.
How can you be sure you’re ready to run a multi-unit franchise?
Unfortunately, there’s no distinct set of criteria for managing a multi-unit franchise, and the preparation process is more complex than simply ticking off items from a checklist. However, we can suggest some key indicators demonstrating you may be ready to run a multi-unit franchise.
If you fit into the following categories, you could make a fantastic multi-unit franchisee:
You’re looking for a way to expand rapidly
One of the key reasons why people opt to run a multi-unit franchise is the chance to grow a business and generate significant profits within a short space of time. If it’s your ambition to establish a large market presence and achieve quick growth, multi-unit franchising could be for you.
While some investors might prefer to set up one business after another as and when they feel ready, launching several units at once can lead to high profit potential. You’ll have the chance to save costs by spreading resources across your network and grow with maximum efficiency.
You want to play an instrumental role in the franchise
If you don’t shy away from responsibility, the franchisor may be more likely to appoint you as a multi-unit franchisee. You’ll be representing a large share of the brand’s units, so you’ll need to be extremely reliable and accountable for the success of your network as a whole.
>> Read more:
You’re prepared for the management duties
Establishing and running a multi-unit franchise operation involves different skills to those associated with single-unit franchising. You’ll take a less hands-on approach and, instead of being actively involved with the customer journey, you’ll delegate tasks to individual managers.
People who love to be in complete control may struggle with multi-unit franchising, so it’s worth considering your preferred working style before you apply for your contract.
You’re comfortable leading a team of franchisees
Multi-unit franchisees should be highly capable leaders. If you take on the role, you’ll be responsible for everyone who works in your franchise network, and the senior figures will look to you for guidance and instruction. You will need to manage the hiring process, implement training programmes and oversee activity across the region.
Finding a balance here is key; you’ll need to support your network but avoid micro-managing.
You’re unafraid to work hard for higher profit potential
Running a multi-unit franchise involves a lot of hard work - there’s no getting away from the fact. You must be prepared to put in the hours to make sure all your units are performing well.
If your venture is successful, you could generate more revenue per branch than you would as a single-unit franchisee. But underestimating the work ethic you’ll need as a multi-unit franchise owner could be disastrous. Make sure you’re dedicated to business success before you sign on the dotted line.
You have experience and expertise
It can be easy to get carried away with dreams of business growth, but it’s vital you have the right knowledge and experience before you become a multi-unit franchisee. The franchisor may provide a comprehensive training programme, but you should be confident you have the insight to build a successful business before you get started.
There’s no need to rush things. Consider taking the chance to develop a single franchise branch under the brand or work within the business to develop your understanding of the system before taking on multiple units.
>> Read more:
- 5 Qualities of a Successful Franchisor
- 4 Things Franchisees Never Have Time for But Are Essential for Running a Successful Business
- How to Launch a Franchise and Get Noticed
- 4 Elements of a Successful Franchise
- How to Start a New Business on a Shoe-String Budget
- The Ultimate Guide to Franchising Success
You’ve completed in-depth market research
A franchise may have seen success in one area, but there’s no guarantee it’ll work well in another. Although you can never know for sure whether your multi-unit network will reach high levels of profitability in a given region, completing market research can give you more insight.
It’s vital you spend a significant amount of time looking into your chosen area, even if your franchisor says they feel confident about the territory.
You can rely on your franchisor to support you
Your franchisor should always be there to support you, particularly if you ever feel overwhelmed by the size of the challenge ahead. Ideally, they will be able to encourage, guide and advise you when it comes to running a successful multi-unit network.
It’s important you feel you can go to them with any problems you have, and work closely with them over the course of your franchise contract.
You have vision, ambition and motivation by the bucketload
There’s no getting away from the challenges of life as a multi-unit franchisee. Although it can bring fantastic benefits, you’ll probably also face many obstacles. At times, the path to profitability will be tough, but keeping your vision in mind will help you stay on track.
In fact, to launch a business of any kind, you need patience, commitment and bags of motivation, so it’s important you’re dedicated to building a successful network.
More information on multi-unit franchising
If you’ve still got questions about multi-unit franchising, you can find more details in our comprehensive guide to the system. Alternatively, why not browse our other recent articles or take a look at the franchises currently offering investment opportunities?
The Editorial Team, Point Franchise ©
0 Comments