How to Go From a Single-Unit Owner to a Multi-Unit Owner

Thanks to proven business models, comprehensive training, and ongoing support, franchising your way to business ownership has become an advantageous way to make entrepreneurial dreams come true. Each year, thousands of new franchisees begin a new life with more freedom and flexibility – as well as full control of their income-generating capability. Franchise ownership also provides a better-than-average success rate for owners who’ve been in business for several years.

For those who have experienced this level of success and stability, it’s only natural to consider expansion and growth. After all, that’s literally the very premise of franchising. But how does one go about this process? Of course, there are plenty of internal and external considerations involved, but Unleashed Brands’ proprietary enterprise platforms have been developed and refined to encourage expansion and growth among our franchise owners. Below, we offer some helpful advice for single-unit franchise owners who desire a multi-unit future.

Some Facts About Multi-Unit Franchising

According to recent statistics from FRANdata, more than half of U.S. franchisees are multi-unit owners (MUOs). Some industry categories lend themselves to this strategic expansion and growth, most notably QSRs, where more than 80% of all unit locations are part of a multi-ownership portfolio. Multi-unit ownership has become quite popular among private equity and enterprise-level investors, many of whom are semi-absentee and employ this strategy to diversify their operations with multiple brands. Still, the majority of multi-unit franchise owners – some 42% - own only two to five locations total. What multi-unit ownership is really about is scalability – higher risk, but also higher reward.

First Things First…

Before existing single-unit owners consider ownership of multiple locations, careful planning is required. Before you expand, it goes without saying that your initial franchise operation should be running smoothly, with a solid track record profitability - both on a monthly and annual basis. Expansion requires capital, which can be accessed from the existing business or utilizing any number of funding options in which the existing business is offered as collateral. Going from a single-unit owner to a multi-unit owner may also require the delegation of authority, something you should be prepared to handle. Your role will probably transition from operations to development. Even utilizing the advantages that come from single to multi-unit expansion, you’ll still be taking on a degree of additional debt, staffing, and inventory.

The Benefits of Multi-Unit Expansion

Now, the good news. Because franchising’s business model is predicated on replication, you won’t exactly be reinventing the wheel to acquire an additional location or two. You should already have a good idea of the resources at your disposal and how you can scale them to benefit your effort to expand operations. Your fixed operating costs can be absorbed and spread across multiple units, and you can likely barter for better terms with vendors and suppliers. With a crack staff already in place at your existing franchise operation, you’ve also got experienced employees who can contribute to the training of additional staff. All combined, what you’re actually doing is creating efficiencies that cut right across the balance sheet, upping your profit margin and generating more ROI.

One final thought to share about transitioning from a single-unit owner to a multi-unit owner. Your business acumen and leadership skills will be on full display. Even expanding to one additional location means you’ll now have twice the staff, twice the inventory, twice the vendor invoices, and twice the routine complications of running a successful business. You have to assess your own ability to handle overnight growth and the stress and risks that come with it. But, as many successful multi-unit owners can attest to, expanding your territorial footprint can be well worth the potential rewards at stake. If you’d like to explore what’s possible, contact Unleashed Brands for guidance.

A Little More About Us…

The Unleashed Brands platform includes Urban Air Adventure Park, Snapology, The Little Gym, XP League, Class 101, and Premier Martial Arts youth enrichment franchises. As the parent company, Unleashed Brands was founded to curate and grow the most innovative and profitable business opportunities that help kids learn, play and grow. Over the last 10 years, the team at Unleashed Brands has built a proven platform and know-how for scaling businesses that focus on serving families. All have become first-in-category brands by providing fun, engaging, and inspiring experiences that help kids with their No. 1 development goal – to become who they were destined to be.

To speak with one of our franchise experts and learn more about our children’s business opportunities, simply fill out this form and an Unleashed Brands representative will be in touch shortly.