FRANCHISING VERSUS TRADITIONAL EXPANSION METHODS
GROW WITH FRANCHISEE INVESTMENT
A franchise model allows you to grow and expand your business with other people's capital.
The franchisee provides all the start-up capital required to establish the additional business unit. So whether you want 2 or 20 business units your costs remain relatively the same.
MOTIVATED PEOPLE GROWING YOUR BRAND
The average employee will spend 18 months in a job, whereas, the average length of time a franchisee spends in their franchise is 8 years.
Franchisees are motivated and invested in the success of the brand which is often referred to in franchising as 'skin in the game'. Long-term commitment, improved operational function and productivity are just some of the advantages.
SPEED OF GROWTH
Opening or starting additional locations is expensive, risky and time consuming.
A franchise model allows the franchisor to grow as quickly as they can onboard new franchisees, and their capacity to provide training and support with unit establishment.
REDUCED OVERHEADS
Franchising allows the head office to function with a much smaller staffing resource, relative to a similar sized employee operation. This is because franchisees are responsible for many of the day to day responsibilities and tasks.
INCREASED PROFITS
The reduction or alleviation of management resource and other associated costs usually required to support and sustain similar growth within a business, ultimately results in a more profitable outcome.
FULLY SCALABLE MODEL
A franchise model allows the franchisors organisation to grow exponentially from one set of franchise documents, so whether the objective is to open 2 more business units, or 200+, a franchise model makes this possible.
EXPANSION INTO ADDITIONAL MARKETS
Once the franchise documents are drafted it can be relatively simple to add additional services that compliment and operate in similar industries and markets. This enables the franchisor and franchisees to achieve organic growth with little capital outlay.
RISK REDUCTION
Franchising significantly reduces the risk for the franchisor. In a typical franchise model the franchisee has all the responsibility for the upfront investment in establishing the franchise including purchasing plant and equipment, premises fit-out, hiring employees, and any working capital required in the beginning.
