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What Is the Best Advantage of Multi-Unit Franchising?

A business owner who strives to succeed should keep a keen eye on their firm’s bottom line. After all, the fundamental reason for starting any business venture is to make a profit, no?

If you’re into the franchise business, you might be wondering, “what’s the point of starting a multi-unit franchise?” And while at it, or if you’re chomping at the bit, you could explore the best multi-unit franchise opportunities here. Meanwhile, let’s break down the upsides to give you a better picture. But first…

What Multi-Unit Franchising Entails

Multi-unit franchising involves investing in multiple franchise units in a particular geographic area. Essentially, it’s a deliberate attempt to build your business empire. That means if you play your cards right by applying your resources toward the right franchise opportunity, you can maximize your success.

Full disclosure, multi-unit franchises aren’t for the faint-hearted. They require immense self-confidence and belief in the concept you buy into. Plus, you need to be financially endowed to pay the franchisor’s upfront fees and meet the set minimum net worth and capital requirements. If you have the financial muscle, multi-unit franchising is a sensible approach to scaling your business.

Investing in multiple franchises can be a solid growth strategy, but the key is to invest in the right market. Unlike a single unit that may offer little growth potential, multiple franchises give you a leg up on the growth front. Here’re the potential advantages of multi-unit franchisees.

More Revenue

Multi-unit franchising can set your business on an upward trajectory. Let’s assume you’re investing in five units of a popular franchise. By running multiple units in prominent locations, you can quickly scale your business and increase your revenue up to five times (if all factors are constant). This would be unlikely if you opted for a single unit.

Higher revenue means a rise in profitability for your franchise, which we alluded to at the start of this piece. And a rise in net income presents other investment opportunities. Case in point, you can opt to invest in additional units. Alternatively, if you prefer not to have all your eggs in one basket, you can search for other viable investments and keep building your business.

Sharing of Resources

Operating multiple franchises allows your units to share resources. For instance, using the same supply chain helps keep costs low by ordering products for all your outlets and using one truck to deliver them. By spreading your fixed costs, you would indirectly improve your bottom line.

Plus, if one unit experiences a shortage, you can easily plug the gap by sourcing from your other stores without involving your corporate supply chain. Along the same lines, you can negotiate with vendors for better pricing or payment terms, allowing you to gain invaluable economies of scale.

Also, you can adopt a local marketing plan tailored to all your similar stores. By so doing, you keep your costs low and increase your earning potential.

Similarly, you may tackle staffing shortages in a location by requesting employees from another outlet to fill in temporarily for absent employees. Or, you can relocate workers to other outlets depending on their needs at the time. Given that the operating procedures are similar at each unit, your staff can easily fit in at any location. As a result, such a flexible approach to staffing reduces expenses.

Leveraging Expertise

Running multiple units lets you garner hands-on experience. Once your staff understands the do’s and don’ts of running a successful franchise, you can leverage their experience as you open new stores.

Consequently, launching or running an effective outlet becomes a walk in the park if you have competent staff in your corner. Besides, such expertise reduces the costs of training or onboarding new workers, thereby allowing you to generate results quickly. But that’s not all.

Unlike pursuing a business independently, starting a multi-unit franchise means venturing into an established line of trade. Besides, you get to do it several times over, not to mention that you have a support network from your franchisor if you encounter headwinds along the way. In short, you don’t have to waste time and effort trying to figure your way around. If you intend to make your franchise dreams a reality, multi-unit franchising provides a clear path. Essentially, these benefits tie neatly into your business’s core goal of generating a profit by managing costs and making the most of available resources. To find an ideal multi-unit franchising opportunity, remember to research widely before investing your hard-earned cash


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