Franchising Your Business

5 Reasons To Expand Franchisee Business Regionally

Business Expansion Across Region Should be Your Next Step
5 Reasons To Expand Franchisee Business Regionally
Image credit: Franchise India
3 min read

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After establishing your brand successfully, the next step is expansion. Now expansion can be across the region, pan nation and internationally. We suggest, take baby yet bold steps and start by expanding across the region. Here are a few reasons why you should think of expanding your franchise business regionally: 

Localising your brand

The best way to expand your franchise business is to tap into a franchisee base that might be attracted to your business model and willing to expand it to local regions. This is important for the simple expansion of your brand, provided you have a brand that can speak for itself and benefit a regional customer as well.

Save on overheads: 

If you want to save on incurring overheads and costs associated with opening company-owned outlets, a rapid regional franchise business expansion is a good option. This strategic move can bring benefit to both franchisor and franchisee as it helps build consumer recognition quickly and establish the franchise.

Limit manpower investment:

Expanding your footprint will also allow you to expand your business without spreading managerial resources across too many business units. “A business owner may wish to keep his/her own operation small and tightly run. Operating more than a few outlets can drain business resources. A franchise system requires less management than a company owned chain of outlets. Hiring, training, motivating and retaining competent staffing are all functions handled by the franchisee, not the franchisor,” suggests, Nick Solomon from Franchise Direct.

Outreach of a unique service or product:

Go out into regional areas because your service or product is unique and you have not got the acumen to reach everywhere on your own. This is a good way to tap a foreign market particularly those that are different and not a franchisor's home market. By using indigenous franchisees, the franchisor is tapping into local business knowledge which may prove beyond his or her capability to obtain otherwise. People who know the local scene well deal with legal and cultural differences more easily than an overseas company executive would.

Bringing down Advertising Costs:

Believe it or not, but expanding into new regions can actually bring down publicity costs. Let the product speak for itself and once you have the right franchisee in place, they will take care of the regional advertising and publicity. You will simply have to ensure the uniformity in your main messaging. On the importance of advertising, Tri Nguyen, Founder and CEO of Network Capital Funding Corporation says, “Being able to reach the right target customers through the right mediums, at the right time, is the first step to expanding your business into new customer markets. When expanding into new target markets, you need to ramp up your advertising to these markets. This is pretty intuitive, but it’s true.”

This article was originally published on Franchise India by Uttara.J. Malhotra.

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