Multi-unit ownership is on the rise in franchising, and that growth isn’t limited to traditionally multi-unit franchise industries like quick-service restaurants. According to FRANdata, owners who operate more than one location are responsible for 54 percent of all franchised units in the U.S. Just eight years ago, single-unit owners held the majority.
Many prospective franchise owners are entering the discovery process with plans to own and operate multiple franchise locations. If you’re evaluating franchise brands and looking to grow beyond a single location, you can be successful by going in prepared for the unique challenges this presents. Everything, from choosing the right franchise opportunity for your skillset to the location of your first unit, should set you up for multi-unit success.
We spoke with Ed Rothschild, owner of four AlphaGraphics locations in the greater Denver, Colorado area, and here are some of his tips to help aspiring multi-unit owners achieve their growth vision.
Choose the Right Franchise
First, it is key to select a franchise with a model that supports multi-unit owners. Some owners purchase multiple territories right away, while others open a single unit, grow their business, and later decide to open another. If you think multiple units might be in your future, ask questions about multi-unit ownership before you look at territories and sign the franchise agreement.
How does the franchisor support owners when they want to expand? To serve multi-unit owners, a franchise network’s software, operational systems, owner training and tools must be more sophisticated. Speak with existing franchise owners who already own multiple units to find out about their successes and challenges.
In addition, find out what your role would be within your business. As an owner/operator, you won’t have time to do it all, especially right away. How many people do you need to hire right away so you can focus on sales and marketing? Whatever you choose, make sure you have a plan with the remaining roles in your business. A great franchisor will walk you through these things during your discovery phase. A great franchise brand will also assess your knowledge and skillsets and steer you in the correct path for your talents and interests.
To succeed in multi-unit ownership, you have to hire the best management and operations staff possible. You can’t be in every location every day. That’s why it’s vital to have a great leadership team on board to manage and run your businesses when you can’t be there. You need to be able to trust the team you put in place, and they need to have buy-in for your growth vision.
The task of hiring well can be particularly challenging in today’s tight labor market, but you can’t afford to settle for second-best. Rely on your franchise’s proven systems. Many will offer processes and support when it comes to recruiting and hiring.
Once you have a great team behind you, do your best to keep them. Nurture a great company culture. Offer robust training and professional development, along with plenty of opportunities for advancement. You can’t afford to have high turnover when you’re operating multiple units. Onboarding new employees will your take time away from running your business.
Especially in industries like business services that require ongoing customer relationships, multi-unit franchise ownership isn’t ideal for absentee owners. Hands-on management is required to get your businesses off the ground and running successfully.
You have to maintain a regular presence in each location for your business to thrive. Before you open a second location, make sure you’re willing and able to travel frequently among the units you operate.
Being a presence in each unit also grows a sense of cohesion between the locations. Instead of each unit being a stand-alone operation, they should act as a team to better serve your customers. For example, one central location may offer a specialized service that the other locations can order for their customers.
However, this type of cross-selling only works if all staff members are encouraged to work together, and that culture starts with the business owner. It’s not enough to just show up. You have to be a contributing part of the staff in each location, leading the team by example to create the type of network you want.
Owning multiple franchise territories is an exciting and fulfilling career path that lets you see the results of your hard work.
The multi-unit path isn’t for everyone, though. And it won’t work with every franchise. Make sure your talents and skills match the requirements of multi-unit ownership long before you start down that road, and be sure you’re purchasing a business model that will support your growth vision.
Bill McPherson is vice president of franchise development at AlphaGraphics, one of the largest U.S.-based networks of locally-owned and operated Business Centers, offering a complete range of print, visual communications and marketing products and solutions. For more information about AlphaGraphics services, visit www.alphagraphics.com. To learn about franchise opportunities, visit www.alphagraphicsfranchise.com.