Before planning a second franchise, it’s important for franchise owners to make sure some ducks are in a row with the first.
WHY NOT TWO FRANCHISES?
If you’re a location-based business—e.g. dry cleaner, restaurant, etc.—you want to get through your grand opening and be turning a profit. You want to have a good sense of the buzz about your business from customers. Comments like, “we have so desperately needed this service in this area” or “I wish we had one of these in my town” or something along those lines are things you want to note. Most importantly, you want to smooth out the operational hiccups before entertaining expansion plans. Some things you will want to consider:
- What’s the current state of the commercial real estate market? – Are rents currently high? You may want to wait on expansion. Maybe there’s an area you are targeting that’s on the rise and you can get in low?
- Do you have enough employees? If you’re hands-on in your current franchise, how can you be two places at once? The answer is you can’t. That’s why having reliable and dependable staff is a must to help run at least one of your locations. Or maybe your current staff will be part of both locations? You may have to hire for both locations.
- What about a loan? Will the bank that helped you secure funding work with you again? If not, what’s your alternative?
- Family support – Many franchise opportunities are quite demanding and can impose on family time. Is your family okay with that? Will they be part of your staff/support for an additional location? This can be a particularly important conversation if your spouse or older children want to help but have other interests they want to pursue.
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