Franchise Advice M
ulti-unit franchising has a nice ring to it: owning a number of business units and running them like a corporate business,
focused on long-term growth. In a multi- unit operation, franchisees work less in the daily operations of a single unit but focus on managing multiple locations at a higher level. But, of course, it’s not easy – there’s a lot of hard graft needed. Here is my list of the top 10 things you need to think about before you consider going into multi-unit franchising:
1. Handing over the reins
When expanding into a multi-unit franchise, the biggest change is from managing the processes of one unit to supervising
people to manage those processes. If your style is to micromanage, you’ll have to start learning how to trust managers.
2. Getting a handle on HR As a multi-unit operator, you are expected to know everything about the business and how it works, so the type of support needed revolves more around managing a business from an HR perspective. This can often be a challenge with a small head- office team.
3. Should you operate more than one brand? Growing a business across multiple units in multiple locations is complex. If you add multiple brands, you’re just adding to the complexity. Can you adequately operate
several units without risking the quality of brand delivery?
4. There are benefits from the added financial support There are times when some units will do well, while others may underperform. One of the benefits of owning multiple units is that the successful ones can support the struggling ones, which means you are reducing your risk.
5. You will have to get better at managing your cashflow Cashflow is more challenging with multiple franchise units; vat and corporation tax are greater and can catch you off guard. Make sure you put in place a good cashflow forecasting process. →
July/August 2017 |
BusinessFranchise.com | 47
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