Multi-unit Ownership: Is it Right For You?

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There are many reasons to consider multi-unit ownership and especially in today’s business environment when many prime locations are becoming available by the day. Single and multi-unit franchisees seeking to capitalize on these opportunities may or may not be right to expand their business by adding locations unless they’re effectively prepared to do so to ensure success.

Typically, expansion is the result of an opportunity or challenge that presents itself – an empty building, a fellow franchisee going out of business and even a competitor expanding into the local market. Unfortunately, many fail transitioning from single unit operations to multi-unit as well as expansion from one market to another or even from one side of town to the opposite side of town.

The key to multi-unit success is being prepared, developing a plan and most importantly, answering very important questions with honest responses. Listed below are some of those questions:

Why does multi-unit ownership excite you? What does a day-in-the-life of a multi-unit operator entail? What do you hope to achieve thru multi-unit ownership? What is your long-term vision with multi-unit ownership? What skills are required for successful multi-unit ownership? Would you consider your current operation a success?

How important are systems to a multi-unit operation? Will you operate two businesses or one enterprise? How will your responsibilities change in a multi-unit operation? Do you enjoy managing people? Do you delegate well? How important is record-keeping to a multi-unit operation? How important is accountability to short and long-term success?

Is bigger really better (and easier)? Is it truly perception or reality? Does one plus one equal two, three, one, or zero? Beyond financial benefits, how does economy of scale present additional advantages?

How important is location to your long-term vision? Why is location of the second or next store or restaurant critically important to a multi-unit operation? Is there really economy of scale in marketing and public relations for a multi-unit operation? What will be necessary to capitalize on economy of scale possibilities?

Can your decision stand the test of time? How do you know when you’re ready to further explore multi-unit ownership? What steps must be taken to get from thought to reality? How must you prepare for multi-unit ownership?

What happens if the second or next location fails? What happens if the first or other location(s) is/are adversely affected by the new location(s)? What happens when you want to retire or move on? Does this complicate your exit strategy goals?

How will multi-unit ownership affect your personal life? Understanding risks involved, are you willing to proceed? Are you comfortable with being an entrepreneur as opposed to just a business owner? Are you considering multi-unit for the right reasons? Are you (truly) committed to move forward? Do you NEED to do this now? Do you REALLY NEED to do this now? AND… do you truly love what you’ve been doing up to this point?

Upon honestly answering these questions you’ll have a snapshot of things you may need to put into place and/or improve upon along with a better idea of whether or not multi-unit ownership is right for you.

Note: Franchisors should require franchisees requesting multi-unit ownership to answer these questions and utilize the responses as part of their approval process.

Change… Because Failure is not an Option

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Like a ship at sea, a business should make directional changes in a long, sweeping manner. Conversely, although abrupt change in direction may create havoc, it may be deemed necessary by the captain and navigation team to avoid what may not be apparently visible on the surface to others on the ship, but is evident nonetheless through compilation of data and viewing radar. In any event, well thought-out plans, including contingency plans must be in place and acted upon to arrive safely at a specific destination within a certain time frame, and with available resources.

However, what happens when seas are rough, or when a storm is approaching, or when an engine shuts down? It’s then the captain’s responsibility to crew and passengers, and to the ship’s stakeholders to make any and all necessary changes to ensure all interests are protected. Thereafter, when the ship is safely docked, management must review the events that took place and explore options to ensure the same problems don’t reoccur. Management must identify ways to improve performance by developing strategy and executing on tactical plans to accomplish objectives at all required intervals – short, mid and long-term.

Change requires thought and planning. As does operating a successful business. As change occurs, many within the business are exposed to decisions that on the surface appear to be “drastic or severe” and are not understood and/or agreed upon. However, what is typically not realized are areas of weakness and vulnerability that must be addressed and with the utmost sense of urgency. In many cases there are common denominators across multiple areas of the business. Most will be directly attributable to reduction in sales. Some will adversely affect profitability.

Unfortunately, financial concerns are back and now even more so than during the economic downturn of 2008-2012. But, as was the case back then, deficiencies, previously overshadowed by high sales levels will start to stand out again like sore thumbs. Accepting these facts while realizing limitations and shortcomings is vitally important, but knowing what and how to improve [and change] is required. Being proactive and acting now is paramount!

Change what needs to be changed. Prioritize changes that will make the most immediate impact. Grow into the changes that aren’t urgent. But, do it all within the time frame where challenges present themselves as survival may be dependent upon the same. Change, as unpopular as it might be, is necessary to recover AND to move forward. To this end, hard decisions must be made – with absolute conviction and without delay for the good of the business and ultimately, for all within the business. Yes, change is difficult. But so is failure, and failure is not an option!

30-year Pizza Brand, Pepperoni’s Now Franchising

After many years of building a successful brand, Pepperoni’s Founder & serial restaurateur, Ray Salti developed a more efficient scaled down business model that addressed many of the issues facing restaurant operators today – high real estate costs, escalating labor costs, diminishing workforce pool, quality control and increased demand for take-out & delivery.

Proving the new model for over five years with increasing revenue and profitability, Ray decided to launch the new Pepperoni’s into franchising in mid-2019. To ensure success as a franchise system, significant financial resources were committed to technology integration, modern unit layout & design, operations support & training and a call center.

In addition, a modern corporate office is currently under construction for the growing Pepperoni’s team, test kitchen, training facilities and commissary. Combined with delivery of exceptional New York style pizza, positively memorable customer experiences and excellent unit-economics, Pepperoni’s is well-positioned for franchise success.

Single and Multi-unit Franchise opportunities are available along with Area Development opportunities such as those that recently resulted in two five-unit development agreements in Greater Houston Area. Short-term growth plans include all major and secondary markets throughout Texas followed by expansion across Southeast U.S.

Interested in owning a Pepperoni’s? Learn how by inquiring at https://franchisefoundry.com/franchise/pepperonis/

#pizza #franchise #lowinvestment #QSR