With growth, in some form or another, being a common goal amongst multi-unit franchisees, we have been looking at key areas of focus to ensure proper planning for growth. For owners simply looking to grow in units, franchise CPA Michael Iannuzzi, in our last article, “How to be Well Equipped for Funding Growth,” shared the importance of laying out a long-term profitability budget and cash flow budget so multi-unit franchisee owners can project the required capital to accurately fund and meet goals.
In this installment, we reached out to Michael Einbinder, franchise attorney with Einbinder & Dunn, for a different perspective. Einbinder shared with us that franchise owners who have developed multiple units of the same franchise within a market, may feel as if they cannot support an additional unit without cannibalizing their sales. He says that finding the next area for expansion in a saturated market can be difficult but that multi-unit franchisees are uniquely positioned to thrive in this environment. Here he answers that conundrum of what to do? One potential solution he has seen multi-unit owners explore is developing other brands within their market.
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