You're expanding your franchise business. What factors should you prioritize when selecting a location?

When expanding your franchise business, choosing the right location is critical to success. Here’s what to prioritize: 1?? Demographic Match: Ensure the area aligns with your target customer base. Study local demographics to ensure demand for your product or service. 2?? Visibility & Accessibility: Pick a location with high visibility and easy access, ideally in high-traffic areas to maximize footfall. 3?? Competition: Assess the local competition. Is there room to thrive, or will you struggle to stand out? 4?? Local Market Trends: Stay aware of local economic and market trends to ensure long-term growth potential. 5?? Cost & Scalability: Ensure the location is affordable and scalable for future growth.

Conducting a thorough market analysis is crucial for franchise success, as it informs strategic decisions about location and positioning. Beyond demographics and competition, it's essential to assess local economic trends and consumer preferences, which can shift over time. Additionally, leveraging tools like geographic information systems (GIS) can provide deeper insights into customer behavior and potential market gaps. Understanding the nuances of the local market not only helps in selecting the right location but also in tailoring marketing strategies to resonate with the target audience, ultimately enhancing customer engagement and driving sales.

While considering a franchise market expansion it is wise to complete a thorough market analysis. Consider local demographics (age and income primarily) and consumer habits. It's imperative to ensure that there is a demand for your product or service before monetizing growth, for growths sake. Do the math, consider the market area, and proceed with analysis and caution.

It depends on the business type. If it's a 'destination' business—one that requires customers to travel to it and doesn't rely on foot traffic—it can operate in non-central neighborhoods. In this context, accessibility and visibility are important. At the same time, having other businesses nearby that either have synergy with your target audience or are complementary can be a strong indicator that you're making the right choice. These can act as hubs that generate additional traffic for the area. For example, a children's hair salon located near a preschool.

-Find right product market fit -Stay close to your customers -Factor in transportation/logistics/delivery cost -Have a vision in terms of increasing customer base, for example new infrastructure being built, new opportunities - Have clear vision, how you are going to grow your business in that location - understand customer sentiments, their comfort area, their pain points, their expectations

Consider carefully how your business gains customers and how they use your services. Retail services can be very location sensitive. If they rely on customers coming frequently, like multiple times per week, then you must choose based on density (not just demos) within a 10-minute drive radius. If you are a higher ticket item used less frequently, say a high end hair salon, you need a good location but maybe not the highest visibility, since you're a destination business and customers only come every few weeks usually. Site selection is critical for location-based business, I recommend to my candidates to triangulate the franchisor's software/site selection, their professional retail broker, and their market research to screen sites.

Parking is important. Ease of access is important to the franchise's success, as people (especially in this day and age) aren't going to fight their way to your business. Look for locations that provide plenty of parking, but also reachable by public transportation. You need the greatest amount of potential customers possible, while providing them with the best possible experience - which starts and ends with parking.

Foot traffic is imperative for retail or service-oriented franchises. There must be a location which meets the needs of the franchise, while allowing for a steady flow of potential customers. You wouldn't build a coffee shop in the country. You want a sustainable site where the level of traffic meets the needs of the business. If a coffee shop, would you want to sell 50 cups of coffee a day, or 1,000? 1,000 is more sustainable for the franchise, so target and go to areas that provide exposure to the greatest amount of potential customers.

O CTO (custo total de ocupa??o) é um grande influenciador da saúde financeira do seu negócio. Por isso, é de suma importancia considerar qual é o valor máximo do custo total de ocupa??o que a opera??o do negócio suporta. Também é de suma importancia considerar negociar um bom prazo de carência pois adequa??es nos imóveis podem ser necessárias, ent?o considere realizar estas adapta??es sem ter que pagar aluguel, se conseguir estender uma carência para os 6 primeiros meses de opera??o, melhor ainda.

Don't fall in love with real estate, as it can lead to overpaying for a location that might not generate any incremental revenue over a similar location with better terms. Stay disciplined to realistic projections and market research. If you need to cap occupancy expense to say 15% of revenue to make your numbers work, don't compromise and pay more for a location because you think you will make it up in revenue. Location-based franchises have a high fixed cost and your greatest financial challenge is breaking even--after that, they can have super high profit margins. But minimizing your recurring monthly costs is imperative if you're starting a new business.