We are not at the same challenging place we were at the beginning of 2020. The business world is returning to normal and has found ways to cope with current uncertainties. Seth Lederman, CEO of Frannexus shares with us 5 easy ways to grow a multi-unit franchise empire for those looking to scale up.
The International Franchise Association’s Economic Outlook report projected that franchising’s impact on the economy would grow by 7% this year.
In fact, the report forecasted that an additional 26,000 franchise locations would open in 2021, which would bring the total number of franchises in the U.S. “higher than the 2019 pre-Covid level.” This would add about 800,000 jobs and up to $477 billion to the GDP of the U.S.
1.Identify synergy opportunities
If you have a business and working knowledge in one area, you will be really tempted to duplicate your efforts in a similar area. For example, if you own a pizza shop you might be looking at opening your burger location nearby. But instead, try a complimentary area, for instance, ice cream or frozen yogurt location. By doing so, you not only encourage sales between these two brands, but you also do not create competing areas for your current business. Moreover, most franchise agreements might not allow you to own similar franchise concepts.
2.Evaluate unique and niche market
Bigger is not always better when it comes to the target customer market. We are likely to assume that a wider scope of franchise brand could result in greater financial success. This is possible with even a niche segment. Firstly, there is less competition to fight. Secondly, you could use innovative and cost effective marketing to promote your business. And thirdly, you can provide a personal and unique experience for all your customers.
3.Measure the scalability for franchise growth
While considering any franchise into your portfolio, always measure the scalability of growth for the brand. In other words, look for the current list of locations the brand is interested in. If the list is exhaustive, the brand is close to saturation. Meanwhile, if the brand has its marketing, designing, social media following in a healthy state, it is more likely to push for further success.
4.Keep it simple
While you are keen on increasing the franchise portfolio, ensure that you select brands that are simple and hassle free. Since each franchise brand can be different in its operational efficiencies, it is important to choose models that are easy to follow. Is it low cost with high-volume sales? Does it offer low occupancy with an easy-to-operate model? If yes, they will not hog all of your time and effort for successful operations. Pick these brands for better growth.
5.Gauge brand visibility
Ensure you pick a brand that has sufficient brand visibility. In business, promoting an unknown brand can become a very expensive task and consume a big part of your budget. Thereby, choose a brand that has good media and social presence to help you save marketing costs.
Source: Forbes
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