“Should I expand my business?” is probably the 2nd-most important question you’ll ever ask yourself, at least on the professional front. The decision to expand – or not – ranks right up there with the question that started it all: “Should I start my own business?”
This blog will show you real-life examples of companies that have decided to expand – both the franchise route and also just by simply opening up multiple locations – along with some tips and tricks that will help if you decide to franchise your business.
Franchising vs Just Another Location – What’s the Difference?
A franchise location, by definition, is one that uses the parent company’s name. If you want to open a McDonald’s, the company lets you use their brand and business model – usually at a significant price. Conversely, if a business wants to simply open up a new location without franchising, they’re keeping it “in the family” – in other words, using their same assets, personnel and capital to launch a new storefront.
There are both advantages and drawbacks to the franchise model. While a franchise business enjoys the influence and name-brand of an established enterprise, the personal freedom of those in charge of the franchise is somewhat limited. For example, if you purchase a Chick-Fil-A franchise, you can’t just start selling hamburgers. Not only would the Chick-Fil-A marketing cow mascots get upset, but you’d also be breaking company protocol. However, if Chick-Fil-A decided to open another location and sell hamburgers, they have the option to do so – with, of course, no guarantee of future profit or success.
Successful Growth Without Franchising
Urgent Care Extra, a growing network of walk-in healthcare clinics in Arizona, has simply expanded to new locations as the demand for more urgent care centers has grown. Rather than selling their brand name for others to purchase, Urgent Care Extra instead relies on keen business acumen and the ability to “know when to say when.” It’s a skill that Brody Purser, Urgent Care Extra’s Chief of Business Development, doesn’t take lightly.
“Urgent Care Extra has been able to rapidly expand because we have remained focused on our core objectives of providing a consistent patient-centric experience within our clinics, deploying programs and services that exceed our patient’s expectations, and ensuring that the selection of new locations will maximize our visibility,” said Mr. Purser.
Would Urgent Care Extra experience the same impressive growth with the franchise model? It’s hard to say, but Mr. Purser’s methods thus far have proven successful – so why tweak a winning formula?
New England-based Dr. Dental features multiple locations throughout the northeast – the company just launched their 40th dental facility in Lynn, Massachusetts – and, like Urgent Care Extra, has utilized a growth-minded business plan without the need to franchise.
Dr. Dental opened their first office in 2004, and has grown forty-fold in the past twelve years. Not many businesses can boast impressive expansion numbers without franchising, but Dr. Dental’s value-added services, friendly personnel and word-of-mouth (literally) advertising keeps the company on a steady expansion curve.
Fixing Autos, Franchising Rapidly – A Lesson in Effective Business Expansion
Unlike Dr. Dental and Urgent Care Extra, Fix Auto decided to franchise in order to put their business model into high gear. Fix Auto has hundreds of collision repair centers across the United States, Canada and Europe. Fix Auto’s US division was founded in 1997 by Erick and Shelly Bickett. After about a decade of growth, new COO Paul Gange made the decision to start franchising Fix Auto repair facilities – and the move paid off, as Fix Auto quickly gained a foothold in Seattle and California.
“Today, Fix Auto is one of the fastest-growing auto repair centers in the U.S., and I credit the franchise model for it”, said Mr. Gange. COO of Fix Auto. “On a certain level, franchising fit the Fix Auto model like a glove; many of our present-day locations started out as neighborhood auto repair centers, therefore the locals were already familiar with the centers services. We simply added the well-known Fix Auto brand, combined with our administrative and collision repair standards, and continued moving forward. All in all, we are pleased with the results of expanding with the franchising model.”
Tips and Tricks for Franchising
If you’re deciding whether to franchise your business, keep these things in mind:
Be hands-on. Many franchise owners make the mistake of assuming their new business partners will figure it out on their own. Take a proactive stance, and the rest will fall in line.
Establish boundaries. That’s what franchising is all about, after all. You shouldn’t expect automatons running your business, but you also need to tell business owners what they can – and more importantly, what they can’t – do.
Research, then research some more. Let’s say your competitor opened a successful franchise five years ago in a Dallas neighborhood. Does that mean your business should do the same? Not necessarily. How have cyclical business trends impacted profits? What are the neighborhood’s demographic trends? Before taking the plunge, don’t talk yourself out of opening a new franchise – talk yourself into it.
E-commerce has its own challenges. “Franchising” your online business is different than traditional storefronts. Pay attention to the details, and make sure expansion efforts don’t take away from what made your original business great (and profitable) in the first place.
Have you franchised in the past, or opened new locations the conventional way? If you’ve done both, which one worked better in the short term – and what about the long run? We’d love to get your personal take on this ever-changing subject, so drop us a line!