Joel Libava
If you’re going to do it, if you’re going to become the owner of a franchise, you might as well GO BIG, right?
In other words, if you’re going to walk into your local bank to apply for a small business loan anyway, why not ask for the moon?
You only live once, right?
About Multi-Unit Franchise Ownership
Just so you know, there is more than one way to grow a franchise business.
You can:
- Add more space
- Add additional territory
- Add more units
- Add more employees
Let’s focus on adding more units.
In most cases, when you’re investigating franchise opportunities, you’ll know pretty quickly if multi-unit opportunities are being offered.
This franchise concept offers multi-unit franchise ownership
If they do offer the chance to on multiple units, and you show enough interest, the franchise development person will share the particulars.
The information you receive will spell out your total investment, along with a specific timeline on when each of your franchise units are expected to be up and running.
Multi-Unit Agreement Example
As a rule, your multi-unit franchise agreement will state the following:
- Your first store (unit) needs to be open no more than 9 months after you sign the franchise agreement.
- Your second store needs open no more than 14 months after store #1 opens
- Store #3 needs to be open 14 months after store #2 opens
Now, your agreement could be for 3 stores-or maybe even 5. It depends on the geographical makeup of your area and your budget.
Go For It! Become A Multi-Unit Franchise Owner
If you decide to “go for it,” and sign a multi-unit franchise contract, the money you make as the owner can be good. Great, even.
For example, if you own a food franchise, and each of your stores (3) does $400,000 in annual revenue, you could pocket $120,000.
(Based on a net profit of 10%.)
And if you can tighten things up-if you can decrease your operating expenses, you’ll have even more money in your pocket. But wait.
What if you have a significant net worth, say $1 million +, and you choose a full-service food franchise?
In that case, although your investment will be higher, your revenue will be higher, too.
For instance, if each of your 3 full-service restaurant franchises does $2.5 million in sales, annually, you could have a profit of $250,000 (or more!) From each one. Not too shabby.
Go for it!
But, make sure you do good research.
Should You Go For It?
I would never suggest “going for it” unless you had good financials, buy-in from your spouse/partner, and the enthusiasm and high-energy needed to pull off successful multi-unit franchise business ownership.
But, it sure sounds exciting, doesn’t it?
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