4 tips for running multiple franchise outlets
Some franchisees are perfectly happy owning and operating one franchise with no intentions of expanding or growing their business. Others see their first franchise as a stepping stone to running a large business with two or even three or four franchise units.
Now is a good time to consider plans and priorities for the year to come. This may be consolidating the business, continuing business as usual or looking at ways to grow.
Bedshed’s Susie Ralph started her franchise in 2006, relocated and expanded her business five years later, and will now open her second store in 2016.
Susie shares learnings from her journey to multi-unit franchising for those who are looking to expand their own business.
1. Communicate with your franchisor
Many franchisors are really proactive, Bedshed included, so it helps to engage them early. They are able to make location recommendations based on market research they have conducted, and can assist with negotiations of the lease agreements.
In our case, they had already secured a suitable location and offered the site to existing surrounding franchisees. I took this opportunity to re-evaluate my business, and discussions were made with Bedshed to expand.
2. Do your research
The importance of taking the time to do your own research when deciding to open an additional franchise is critical. Ask yourself some hard questions. Can you afford to have a second franchise; can you afford not to? Will this hinder or complement your existing business? A SWOT analysis is a good tool to use for the new site and how it will affect existing business. A business plan is also a good decision making tool, and will be essential as part of the franchise approval process, along with accountant and legal advice.
3. Leverage economies of scale
Plan how you will leverage the economies of scale offered by having multiple franchise units. Stock purchasing and storage, for example, can be combined so you can get double the reward without twice the outlay. Also, think about how you’ll staff the new franchise and whether you can use experienced staff from your existing business in the interim, to help get the new one up and running. Consider the cost and the time required for training new staff.
4. Manage your time
It’s hard enough not to get bogged down in the day-to-day running of one business, let alone two or more. It’s critical to manage your time effectively, delegate, and focus on the things that really matter. Some initial time and investment into hiring exceptional, reliable staff will go a long way. Fortunately, in my case, my husband and I work really well together – in fact our skills complement each other.
It is worthwhile to determine what the staff’s strengths and weaknesses are, to use the best of their abilities to run the business. That is the key to running a business. Take care of your people, and they will take care of your business.