Do You Need Franchise Partners?

Does bringing a partner on or assembling a buyer's group make sense for you as a franchise owner? When you're thinking about having a partner or partners in your franchise business, it’s wise to ask yourself, “Why?”???

• Do you need extra finances???
• Do you need people vested in the business to be available when your full-time job or business requires your attention??

Those are some of the reasons that may make sense.

However, sometimes what makes more sense is for a partner to buy several units of a franchise and you buy several units of that same franchise. That way you may find some resources you can share. But by each owning your own franchise units, you’re not totally dependent on that partner and you don’t have paperwork or legal issues if the partnership doesn’t work out. After all, you do have the franchise system as a partner that has your vested interest to grow your business. You also have other owners in your franchise system that you can share ideas and processes without the risk of a partnership.

If you do decide to create a partnership, you’ll want to have one person in charge. The franchise will want to know “who is on first.”? Let’s say three partners come in at 33 1 /3 each. Most franchises won’t approve that. You need one person who's going to be in charge.?

Recently, one of my clients brought on two partners at 22% each, while he holds the majority share of the business. In this case, the majority owner is clearly in charge, but he has the benefit of the minority owners’ involvement in the business. They all share in the profits of the business. The trio has worked together in professional endeavors so they know they work well together. In order to ensure they had enough profit potential for the group, three partners bought into eight units of a franchise. This group will continue to be in the growth mode beyond the eight units they are currently developing. They’ll look to acquire more units of the franchise brand when territories become available over time.

One of the things that can be really beneficial when you're looking at a partnership is to look at multi-unit plays, where you're buying into multiple units of a given franchise. With most franchises, you’ll want to find a franchise that has at least three units and likely more available in a given geographic area. That way, you’ll have enough “meat on the bones” to share with other partners. These multi-unit opportunities are largely semi-absentee so ideally they’re easier to run because of the automation and systems the franchises have designed into these businesses. But keep in mind, you’ll still have plenty of work to do to execute the plan and maximize the profits of these businesses. Remember, you don’t have to have industry experience for most of these franchise opportunities as you’re providing the business savvy and the franchise is providing the technical knowledge of the industry.?

If you think that you’d prefer not to “go it alone” as a franchise owner and want to bring in a partner or partners, I’m glad to discuss that strategy so you can determine if it makes sense for you. Keep in mind that I’m here to help you present your best foot forward to the franchise, because the franchise may not always like the idea of a group of partners.?

Go ahead and scan over the QR code or click here: https://integration.frannetsecure.com/workshop/ccward and we'll get together and talk more about that. As you may know, my services are all free of charge to you, because I work like an executive recruiter, matching people with a franchise rather than a job.?