Deciding to expand your franchise isn’t easy. With the right research and preparation, you can double your profits. Without it, your expansion may drastically fail. Failed franchise expansions may be due to unplanned growth, insufficient funding, inadequate market research, and unskilled management. One thing is clear when it comes to franchising, you either expand or expire. Franchising comes with its own unique dynamics and experiences. Once you’ve grasped them, you can turn your business franchising into a success.

1. Put the ‘Work’ in Working Capital – Taking
your Franchise to the Next Location

2. Introduction
Franchise expansion isn’t easy. It comes with its own unique dynamics and experiences.
 Right research and preparation for your franchise expansion, can double your profits
and lead it to success.
 Unplanned growth, insufficient funding and inadequate market research may lead to
failure of franchise expansion.
One thing is clear when it comes to franchising, you either expand or expire.

3. Is Your Business Expansion Ready?
Things to keep in mind:
 Fully penetrate your home market
 Gauge your business’ strengths
 Perfect your business plan
 Does your business need you?
 Expanding is all that’s left
 Adequate Financing for the expansion
Let’s dig into it a little deeper and crosscheck if your business is ready for franchising based on these
parameters.

4. Fully Penetrate Your Home Market
Before you can think about expanding your business to a second location, ask yourself the
following questions:
 Was your business able to overcome all the hurdles on the home front?
 Have you fully penetrated your home market?
 Are you the “top producer” in your location, besides any friendly-competition you may
have?

5. Gauge Your Business’ Strengths
Major misconception: The best way to make profits is by expanding business to a second
location.
 If your business is not generating a profit or a positive cash flow, this can be a disaster.
 If your store is dependent on traffic from nearby stores, question if you’ll enjoy the same
traffic if you expand to a new location.

6. Perfect Your Business Plan
 The success of your business differs from location to location.
 If your business is successful in your home location, it doesn’t guarantee that it will be
successful in another location.
 The best way to be confident about your business’ success is to take a look at your
business plan.
 Is your business scalable?
 Is it economically feasible?

7. Does Your Business Need You?
 Does your business and your store traffic depend on your physical presence?
 If the answer is yes, you may need to consider finding someone just as knowledgeable
and charismatic to run your second store.
 If you have customers who are happy with your business even without you physically
there, it’s a good sign to continue with an expansion.

8. Expanding Is The Last Thing Left
If you’ve exhausted all other cheaper
alternatives of expansion, such as
creating a website and your social media
has made effective reach- the only thing
left to boost your business is to take it to
a new location.

9. Adequate Financing
 Once you’re sure that your business is ready to franchise to a different location, you need
adequate financing to expand.
 You’ll need the working capital to purchase inventory, hire staff, rent space at a new
location, etc.
 The quickest source of financing available can help you get started on your expansion
right away.

10. The Expansion Strategy
 Know Your Customer
 Prioritize Expansion Areas
 Expansion Operations

11. Know Your Customer
 Before exploring the second location, identify your current customer base.
 Take a survey of your customers to help you build a strong marketing campaign and
establish target customers for your franchise in the new location.
 You can study your customer base through pre-published Public Survey Reports which
carry statistical rigor and cover a significant population base.

12. Prioritize Expansion Areas
 Choosing the wrong location can kill a prospective franchisor faster than any other
factor.
 Prioritize your next location based on internal and external logistics.
 Your internal logistics are inclusive of factors like costs, brand image, strategic priorities,
etc.
 Your external logistics include potential marketing, socio-demographic, real-estate cost,
costs of inventory, hiring staff, etc.

13. Expansion Operations
Last but not least, plan out the operations in your new store.
Designing interiors, hiring staff, stocking up inventory, building computer networks and
intranet, and planning an epic marketing strategy can be quite exhausting.
Get people to know you and your brand in the new location by taking up leadership
opportunities, participating in local events and building awareness around your store in
the new community.

14. Conclusion
Expanding your franchise in a new market is an investment and it requires time, human
resources and money.
Learn from your mistakes, and don’t be afraid to re-strategize and try again.
Once you’ve figured out the best way to franchise your business, your business can only
go one way up from there.

15. Thank You!!
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expansion-2018/