Advantages to Signing A Multi-Unit Agreement on Day 1
Advantages to Signing A Multi-Unit Agreement on Day 1

Two industry experts share insights on the value of multi-unit development and what they look for in potential franchise operators

Every franchisor seems to be on the hunt for more multi-unit franchisee prospects to build their brand. But the value of these strong operators goes beyond the number of locations they represent. For emerging and well-established brands alike, multi-unit operators represent commitment, trainability and leadership skills that can strengthen a franchise system.

For Oklahoma City-based Coolgreens, a franchise offering is new for the concept. With seven strong company owned locations, the brand is venturing into the franchise space and looking for multi-unit prospects willing to commit to building a minimum of three units when they join the brand.

“The philosophy for the industry, and for our brand, has always been that the cost of doing business as a whole goes down as more units are built. The more a franchisee expands, the more beneficial it is for their business as well as the franchisor,” said Clay Carson, VP of franchise development for Coolgreens.

The growth strategy that Coolgreens has established for its franchise system is to sign a minimum of three units that will more densely populate a specific area, rather than adding single units sporadically across the country.

Under its model, Coolgreens franchisees will open one store that is larger than the locations to follow that can serve as a commissary location where fresh ingredients like dressings and soups can be made to distribute to other stores in the area daily. This provides consistency of product, ease of scheduling and maximized labor.

“We are focusing more on labor reduction as we grow into new markets across the U.S. as many cities are seeing a rise in minimum wage standards,” Carson said. “We have had a lot of success with our corporate stores that share management and can help reduce labor costs by around a hundred thousand dollars per year.”

As Coolgreens selects its first franchisees, in addition to the commitment of multiple units at signing and strong operation potential, the leadership team seeks prospects who show the passion that it takes to be invested to make franchise operations successful.

That sentiment is shared among many franchisors whether their system has a handful of franchisees or an international system of operators.

Laina Sullivan, director of franchise development for Retail Food Group USA, parent company of It’s A Grind Coffee House and Gloria Jean’s Coffees emphasized the importance of personality as franchisors identify strong multi-unit operators.

“Franchising is a people business,” Sullivan said. “Multi-unit operators need to be multi-taskers who are quick-witted and able to be fast-paced thinkers who can related to the people that they manage and who they serve at their locations.”

She discussed the value of multi-unit operation for both the franchisee and franchisor due to the economies of scale for construction, signage, supply and negotiation tactics during future development. And beyond the logistics, strong multi-unit operators provide a feeling of trust for the franchisor as they build out key markets.

“We want people who have infrastructure in place and are trainable in the franchise model, but can also relate to the people who they work with on a daily basis,” Sullivan said. “If you’re successful at inspiring and mentoring the teams at your stores, they will stay and represent you and your brand well as you build a multi-unit presence.”