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How to Map More Territories For Your Franchise Business
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If you’re a franchise network owner, you may be wondering how to map out more franchise territories for your business after having sold some already.
You know that there is likely to be interest in you making more franchise territories available, but don’t know where these should be or how to create them without harming the existing territories you have previously sold.
It’s a question that many businesses have so we’re going to outline a few key factors you need to consider.
The first thing to understand is that although your existing franchise territories may seem to be thriving, they may not actually be designed in the right way.
Typically when a business decides to grow through franchising, they select a location to start with that is commonly based on existing geographic boundaries.
These boundaries could be county or state lines, or regions, that may sound logical on paper but in actual fact are not based on business intelligence and data.
Instead they are often based on historic definitions of an area, that made sense at the time but have little relevance to today’s modern world. For example, although the territory could be large in size and include an established town or city, it could be sparsely populated with your target customers or have poor transport links or even contain numerous competitors that make launching a rival business there difficult.
This means that although your existing franchisees may appear to be doing well in territories based on traditional geographic boundaries, they are unlikely to have the same chances of success as one another, ultimately leading to frustration, dissatisfaction, and mixed financial results.
The second thing to consider when planning new franchise areas after having sold some territories already is that you already have some data that can help you make better, intelligence-led decisions in the future.
This information – be it sales figures, sales conversion times, average spend, and much more – can be integrated into a Location Intelligence System like Tech4T’s Territory Runner solution alongside specialist data that makes it easy to see where to launch next.
This data could include population demographics, transport information, customer buying habits, the location of competitors, and much, much more.
Best of all, sophisticated systems like Territory Runner present all this vital information in easy-to-use fully interactive zoomable maps that can be interrogated from postcode / zip code level all the way through to national and even international level.
And heatmaps can be produced that show prime locations for future franchise territories that don’t infringe on already sold areas.
Many businesses use a Location Intelligence System to initially map out their franchise territories in a country during their planning phase, or after they have launched a small number of territories, to maximise their future success.
It’s important to know that it’s never too late to speak to location intelligence experts like Tech4T, even if you are an established business with a number of existing franchise areas.
The expertise and intelligence available means that as the network grows, it is based on solid evidence and data that results in franchise owners having an equal chance of success and the same opportunities to generate revenues for their franchise and the parent business.
And when existing territories come up for renewal, there is also the opportunity to redesign these so they are optimised for greater success in the future, further benefiting the business and the franchise owner.
Harry Scott-Peters, Head of Franchise Sales and Success at babyballet®
“We love our Territory Runner system and rely on it every day. It is a huge sales feature for us, enabling us to provide potential franchisees with fantastic data that leads to a much higher franchise sales conversion rate than ever before.
“Before engaging Tech4T our conversion rate was just 4%. Today it is nearer 10% because of the information we’re able to provide.
“And the system also enables us to map out and plan new franchise territories really quickly and easily, as well as change areas if we need to. The fact that we can also export data simply and interrogate locations on the interactive maps is also vital for us and makes the system an invaluable tool. ”
About Tech4T
If you’re a franchisor – or considering expanding by franchising your brand – you’ll have unique needs when it comes to mapping territories. Tech4T work with the latest, most robust demographic and business data to help you create a successful franchise network.
Whether you are:
- A business owner expanding through franchising - An established franchise owner that wants to improve your territory structure (without disturbing already sold territories) or - An established franchise owner who wants to expand globally
Then our franchise territory optimisation can help you.
IS FRANCHISING ORGANIC GROWTH?
Business owners looking to expand their small businesses often turn to franchising as a potential opportunity for growth. However, many ask if franchising is organic growth, so today, we will answer this question fully and explain the different approaches you can take to growing your business, including how franchising works and how you can make your business a franchise.
Is franchising a form of organic growth?
Franchising is a commonly used method by small business owners of organic business growth and can be a much easier option than purchasing new locations and running them all by the same teams, as this can require large amounts of capital and staffing. This is why many business owners turn to franchising since franchises do stand out from other business models since you will have franchisees managing each location, allowing you to expand your business at scale. Also, when you decide to franchise your business, you save a significant amount of capital on other fees such as construction, renovation & marketing, as the franchisee in the initial franchise fee usually covers these fees.
The advantages and disadvantages of organic growth through franchising
Lower risk – When you franchise your business, all standard costs will be covered by the franchisor allowing you to make pure profits instead of investing your own capital into a new location that may not succeed.
The business can maintain its quality standards – When a franchise recruits a new franchisee, they will have to agree to maintain the businesses quality standards when operating in the agreement meaning you will not have to worry about franchisees not maintaining the expected standards set by you, the franchisor.
Faster growth – Franchising can help you grow your business at scale with dedicated franchisees operating
The disadvantages of organic growth through franchising
Your business might not be franchisable – This heavily depends on what type of business you run. If a franchise requires specialist skills or is difficult for new franchisees to replicate, there is a high chance the franchise will fail. This is why you must ensure your business is franchisable before expanding through franchising.
The barrier to entry may be too high – If you have a business that requires previous experience in your industry, you may struggle trying to recruit new franchisees with the skills necessary to make the franchise business a success.
Expenses – Although you save more capital through franchising your business in the long run, you still need to pay for a few services from lawyers, accountants, and maybe even business consultants to help make your business a franchisable concept to be able to get the ball rolling.
Want to learn more about growing your business through franchising?
Now that you know that franchising your business is a method of organic growth and the advantages and disadvantages of growing your business through franchising, you may be interested in learning more about how you can grow your business through franchising. If so, we recommend you check out our latest articles at Franchise UK for the latest franchising news & advice.
I hope you have found this of interest & use. However, if you require more assistance to get the interest of potential franchisees, we recommend filling out the form below with some basic contact information, and we will put you in touch with experienced franchise consultants recommended by Franchise UK.
Looking to franchise your business?
Speak to our franchise consultancy experts today to learn more about entering the world of franchising.
