Choosing Locations for Your Franchise Branches
Specify the exact location of your business: What is the size of the business location? What geographical locations are important to you? Is establishing a branch in shopping malls, outdoors, on narrow avenues or on wide streets or between roads and out of town the best for you? Each of these places is different, so they will have different features and specifications.
How should the design of decor be based on the plan, business model, services, and products you offer? What is the distance between a branch and the next one? Suppose you receive five different branch purchase offers in an urban area. Does your business have the capability for establishing 5 branches in that urban area? To answer this question, be realistic and carefully assess the current demand for your products or services.
Anyway, your business model will determine this decision. If there were enough demand to create five new branches in an area, you would sell five branches, but the point to consider is how much distance is there between the two branches? For example, having one branch inside the shopping center and another in the outdoor, with a short distance, is possible.
But if both branches are to be on the street side, you need to determine the distance between them. Decision making is based on population density and specifications of the geographical area, the street traffic, and the type of services you offer. The next issue associated with the location is to purchase or rent a property. The majority of franchisors start with renting to reduce the risk and then they move on to purchasing.
Some people have a purchase strategy which is a kind of revenue for them. The value of a franchise or chain store depends on the property they own. The people who can afford to buy the property have a clear idea that their property is valuable and they will purchase the property right from the beginning. Most of these purchases are made with banking capital and loans.
Overtime, instead of paying rent, they pay a monthly installment, and their property values enhance over time. If you are confident in the decision you make, create added value in the long run by purchasing a property. Sometimes you cannot purchase the property, because it is located in shopping malls and passages or office buildings that are not sold at all.
In that case, you have no choice but to rent the property. Sometimes large companies would purchase the property, but charge the franchisee for the rent amount.