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Multi-Unit Franchising - As an Expansion Strategy

[fa icon="calendar'] May 1, 2015 12:00:00 AM / by Benetrends posted in franchise funding, multi-unit

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"Be in business for yourself, but not by yourself."



Today almost half of all franchised units are owned by multi-unit franchisees. Multi-unit franchising creates the opportunity for a franchisee to open more than one unit. In this case, multiple units are sometimes sold at a reduced rate per unit.

The franchisee maybe less involved in the day-to-day operations of the unit. Instead, the multi-unit franchisee manages all the locations at a higher level, usually hiring managers and staff for each location to perform the daily operations.

An Overview

Many franchisees that choose multi-unit franchising as an expansion strategy do so after they have been franchising and know the ins and outs of the franchising business.

There are primarily two types of multi-unit franchise agreements:
(1) area development agreements; and
(2) area representative agreements (also known as master franchise agreements).

80/20- Most research studies find that 80% of franchisees are single-unit operators and 20% are multi-unit operators.

Many Multi-Unit franchisee systems are concentrated in six industry categories – Automotive, Fast Food, Personnel Services, Restaurants, Retail, and Service Businesses.


Why do franchisees choose multi-unit franchising as an expansion strategy?

• System Growth

• Achieve Greater Operating Efficiencies

• Economies of Scale

• Market Strategy

• Reduce training

• Easier to Manage Franchise System

Multi-Unit Franchise Financing

Divide and conquer. When looking at the total amount of capital you need to borrow to get started, consider using a variety of sources including SBA loans, alternative funding and franchise loan packages. Lenders know that franchise businesses have a higher possibility of success because there are already proven set models that work for those businesses; otherwise there wouldn’t be an expansion.

While the current economy does not allow lenders to indiscriminately approve loans, there is a good chance of a well-presented business franchise loan being approved, especially in comparison to a start-up business thats brand new. Many franchisors offer discounts to veterans, minorities, and women.

To learn more about multi-unit franchise funding strategies read: http://www.benetrends.com/blog/financing-strategies-for-multi-unit-operators/

Top 50 List for Multi-Unit Franchising

http://www.franchising.com/multiunitfranchisees/?value=808&mode=articles

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Benetrends President/CEO to Facilitate Session at Multi-Unit Franchising Conference

[fa icon="calendar'] Apr 7, 2015 12:00:00 AM / by Benetrends posted in benetrends, franchising conference, multi-unit

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On Wednesday, April 8th, Benetrends President/CEO Rocco Fiorentino will be in Las Vegas at the annual Multi-Unit Franchising Conference to facilitate a GENERAL SESSION on Franchisees & Franchisors Working Together to Build Stronger Brands.

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Benetrends President/CEO to Facilitate Session at Multi-Unit Franchising Conference

[fa icon="calendar'] Jan 4, 2015 12:00:00 AM / by Benetrends posted in benetrends, franchising conference, multi-unit

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On Wednesday, April 8th, Benetrends President/CEO Rocco Fiorentino will be in Las Vegas at the annual Multi-Unit Franchising Conference to facilitate a GENERAL SESSION on Franchisees & Franchisors Working Together to Build Stronger Brands.

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Building First-Class Programs for Multi-Unit Franchise Growth

[fa icon="calendar'] Dec 26, 2014 12:00:00 AM / by Benetrends posted in franchise funding, multi-unit

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Benetrends President and CEO, Rocco Fiorentino will be facilitating a session at the Franchise Leadership & Development Conference

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Financing Strategies for Multi-Unit Operators

[fa icon="calendar'] Jan 12, 2014 12:00:00 AM / by Benetrends posted in ROBS Strategy, small business funding, sba, franchise funding, 401k rollover funding, multi-unit

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When looking to open a franchise, many times the franchisor wants the franchisee to commit to multiple units. The most common scenario is the desire for a “three-pack” over a two- to three-year window. Funding a multi-unit development was sometimes difficult in the past. But since the credit crisis in 2008, financing a multi-unit strategy is even more challenging than ever.

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