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Sean Manning | CEO | Payroll Vault
Multi-Unit and Diversification in Business Thinking about building your business portfolio with multiple franchises? It’s a top question for lots of business owners – here’s how to do it with confidence. business footprint. However, that expansion must come after thoughtful planning and a strategic blueprint or vision. Building a diversified multi-unit business is an appealing and often rewarding pathway to franchising success when done correctly. And there are some easy steps to ensure successful and sustainable growth through diversification.
Find Your Fit
Every business plan has a certain set of current targets and long-term objectives. Those targets and objectives are ultimately meant to put a business on the path to its most fundamental goal: growth and success. While every business owner — big or small — sets out to accomplish specific goals, bigger is not always better if done without proper preparation. For franchisees, running one successful franchise location may provide the confidence to begin expanding their
The key to building a multi-unit portfolio of franchises is to determine what works for you. This not only means studying yourself but doing research on any possible franchise opportunities as well. Do their business models align with, or complement, your preferred style or business portfolio? Will it allow you to work in an industry that motivates you or provides a service that is of value? And perhaps most importantly, is the franchise’s model one you’re familiar with and confident can succeed? If you are more comfortable running a business model predicated on simplicity (with little space and small overhead, for example), then find a franchise model that fits that category.
The easiest way to take a step towards growth is to replicate a model you know can work, that motivates you to make it happen and provides clear opportunity.
How Much Expansion? Another factor of deciding when, where, and how to grow is to determine what expansion looks like in your eyes. Are you comfortable with the franchise you currently run and simply want to add another location to your portfolio? If so, you might need to determine how your costs or customer base may differ in a new location or what additional operational resources are needed. The familiarity with the brand could be offset by any uncertainties about moving into new locations. Additional resources may lead you to determine that the best course of growth would be adding a new franchise brand entirely. Business owners know their cities better than most. They might notice an opportunity for certain brands that could succeed just down the street from the franchise they already run. Additionally, there would be an existing knowledge about how local taxes, operating expenses,