Some franchise systems only accept franchisees who want to invest in multiple units rather than single-unit franchises. Of the 450,000 franchise units in the U.S., more than half are owned by multi-unit franchise operators. The multi-unit strategy not only offers the franchisor many advantages but also benefits the franchisee. Let’s delve into why becoming a multi-unit franchise operator could be a smart investment.

What is the Difference Between Single and Multi-unit Franchise Ownership?

To see why multi-units can offer a great growth option for low cost franchise opportunities, you must first understand the differences between single and multi-unit franchise ownership structures.

Single-unit Franchises

When you invest in a single-unit low cost franchise business, your agreement with the franchisor will be for just one franchise unit. There will be no expectations for you to expand to several more units at a later date.

Typically, individuals who choose to invest in single-unit franchises are either not looking for a larger enterprise or do not have the capital to become a multi-unit franchise. For example, first or part-time business owners or married couples.

If you choose to invest in a single-unit low cost franchise, you will be the manager of the business and will run the day-to-day operations. You will only have one franchise agreement with your franchisor. A single-unit franchise may be right for you if you are new to franchising and you would like to take on growth slowly.

Multi-unit Franchises

If you choose to invest in one of the many multi-unit low cost franchise opportunities, you could add on additional units after you sign your agreement with your franchisor. Or, in the case of an area development agreement,  you could purchase the rights to develop multiple units of the same franchise within a particular territory over a set timeline. When you own multiple units you will most likely not be directly involved in the day-to-day running of all the franchise locations. Instead, you will probably hire managers to do this for you, while you focus on the overall management of your whole operation.

As stated before, in some cases you could signan area development agreement with your franchisor. This document will detail the number of units you intend to open within a certain timeframe, over a designated territory. So long as you fulfill your agreement, your territory is usually protected from encroachment, so you won’t have to worry about competition from other franchisees within the same system.

Investing in a multi-unit franchise does require a larger capital investment. Also, many franchisors who agree to sell multi-units require their franchisees to have previous experience running multiple units.

Why is a Multi-Unit Franchise a Smart Investment?

From the perspective of the franchisor, selling multi-unit franchises offers better financial security because multi-unit operators tend to struggle less through economically difficult times. Furthermore, multi-unit operators generally have more experience with low cost franchise opportunities. They may also already have strong connections with vendors and realtors, which can help them expand their operation more rapidly.

For the franchisee, owning a multi-unit franchise has a host of benefits, including:

  • Lower overheads: Although your initial start-up fees will be higher than those for a single-unit franchise, your overhead expenses per unit will be lower. This is because you will have certain costs that are shared across all your locations. For example, using the same vendors at each location will help you negotiate better deals for your purchases.
  • Better stability: Having multiple franchise units from the outset means that you have a lower risk of failure in the first year. As your low cost franchise opportunities continue to grow, your chance of success strengthens. When lean times arrive, your multiple units will help each other remain buoyant.
  • Low franchise cost: Becoming a multi-unit franchise owner is not as expensive as you may think. While you will have to spend more on your initial payment, many franchise owners offer incentive deals and discounts to franchisees who want to invest in multiple units. So you may have the opportunity to buy your franchises at a lower cost.
  • Become part of a strong brand: You are already joining a strong brand when you join a well-established franchise. To help strengthen this, your franchisor will provide you with marketing materials and strategies to help you build and maintain your client base. One of the best things about owning multiple units is that while you are a part of a big brand, you can still show your customers how your units stand out from the rest.
  • Establish stronger connections: Owning more units means that you can build stronger relationships not only with realtors and vendors but also with a broader client base.

Why Choose Ultimate Barber for Your Multi-Unit Franchise?

If you’re an experienced entrepreneur who is looking for a multi-unit franchise, Ultimate Barber is one of the best multi-unit low cost franchise opportunities available. Not only is it a highly respected brand, but it also has a solid reputation for producing great returns. When you join the Ultimate Barber franchise family, you will have ongoing access to franchisee support.

While we respect your experience and knowledge of low cost franchise opportunities, we understand that you may not have immediate knowledge of the barbershop industry, which is why we are here to help. We don’t expect you to have prior experience within the industry, but we do prefer you to be an experienced multi-unit franchisee. A passion for barbering is an added bonus. Our support system includes the following benefits:

  • Help choosing your buildings
  • Our Ultimate Barber brand build-out
  • Ongoing training and education
  • Guidance marketing The Ultimate Barber brand
  • Digital spreadsheets for daily operations

Come on Board With The Ultimate Barber

Are you inspired to join our team as a multi-unit franchisee? Get in touch to learn more about our low cost franchise opportunities today. We can’t wait to meet you and talk about your ideas for a new barbershop business.