Multi-Unit Franchise Purchase the Way Forward?

I’m sure those of you who watch the market closely will agree that the days of single purchase franchises seem to becoming a thing of the past.

Franchisors are planning their growth patterns along the lines of recruiting viable franchisees who will be able and capable to own and manage multiple units. Now, this sometimes means, like in the case of Dominoes and Costa Coffee, that the franchisee will own more than one restaurant (sometimes as many as 4 to 5); but with other multi-service franchise groups…the franchisee may own a variety of the brands under the franchisor banner…for example with Service Master: a franchisee may run a Merry Maids (domestic cleaning) operation alongside a Trugreen (lawn care) one.

Now, the only issue I have with this, on an ethical franchising note – is that I would really hope that these individuals are given all the support, training and guidance that they would need to not only manage one unit…but a small growing empire. I have heard of franchisors who will gladly ‘sell’ multi-units, but don’t really have the resources to help the franchisee manage what it all means in practicallity.

Within my planning sessions with prospective franchisors I will always work a ‘career path’ into the franchise model with them. With a keen eye on the phases of a franchisee life cycle…I educate the franchisor on how the franchisee’s interest will evolve over time – so that they can ensure that they retain the franchisee and don’t end up spending more money having to terminate or recruit new franchisees.This includes building in the option for further unit purchases or having different levels of franchise ownership (in terms of staffing, vans, areas etc)..which a franchisee can progress to (after proving capability over time).

My stand has always been to recruit wisely and with care….because you are in essence choosing ‘family’. These franchisees will be with you for the next five to ten years, a relationship that will not be easy to get out of when you find out that you didn’t carry out your due diligence during your application process.

I think multi-unit ownership is great, but it must be undertaken with due caution and consideration – from both the franchisor and franchisee’s perspectives.

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