Master Franchising Benefits

The top 7 benefits of master franchising

Master franchising is the next big thing. A rising number of investors use the master franchise model to open multiple sites and manage different brand business locations over a country or region. British Franchise Association is reporting that more than a third of franchisees are now operating more than one unit – a seven per cent rise since 2015.

So, what’s all the fuss about? One of the biggest draws of the franchise model is the ability to simply and quickly replicate a thriving business, but there are many great benefits to master franchising. Here are the top ten:

#1 Franchise royalties and fees

One of the biggest draws of the master franchising model is profitability. While there’s a lot of work that goes into recruiting, training, and supporting all your franchisees, it’s not for nothing. A significant percentage of the initial franchise fees they pay, as well as their ongoing royalties, will go straight to your pocket. While the specific percentage received by a master franchisee through fees varies, it’s generally around 50%.

#2 Proven business model

Getting a ready-made franchise package that comes with a proven business model and established brand recognition is a huge benefit of master franchising. There’s no need to reinvent the wheel or seek out a system that works. You’re just handed it. You can start at the point it takes most entrepreneurs years to reach and hit the ground running.

#3 Prestige and influence

Being the head of multiple franchise units as you oversee your brand across an entire country or region carries a certain amount of prestige (not to mention job satisfaction!). The satisfaction that comes with a master franchisee is substantial, but it also comes with a great means of financial leverage.

This gives you influence within the business, positioning you to make a great deal of profit, while hugely expanding your network. The more the business grows and develops the more your master franchise becomes the core strength of the whole business.

The role ensures you gain a wealth of experience, putting you in a very strong position in the event you decide to sell off your master franchise territory. By developing a master franchise territory you can effectively shortcut a long career track and achieve a huge amount in just a few years.

Essentially, it’s a fast-track to massive career and personal growth.

#4 Additional profits from additional services

Becoming a master franchisee makes you a ‘middleman’ (so to speak) between your franchisor and sub-franchisees. You receive initial fees plus royalties from individual investors, then pass a percentage of that income on to your franchisor. While the franchiser is usually the one to decide how much their percentage is, you may have room to negotiate it prior to signing up.

While you’ll need to spend some of that income giving your sub-franchisees support, there will also be room for you to create additional profits. Essentially, the more franchise units you have, the more profit you can make.

This can be achieved through add-on services that can provide you with additional income. For example, bookkeeping, accounting, consultation services, and people handling. These are all services which can be provided for additional fees.

#5 Exclusivity of territory

The majority of master franchise agreements grant you exclusivity over your territory. That means your area is yours, and yours alone, to be worked only by you and any franchisees you recruit. There’s no hassle of competing against others in your franchise. You simply have scope for limitless expansion and growth.

#6 Hiring skilled employees

Being a master franchisee gives you the advantage of hiring the most skilled employees available. This gives you access to individuals who can aid you in everyday management tasks, freeing you up to concentrate on other areas of your business, or branch out into a new business venture.

#7 Equity and value

As you continue to expand your business you’ll also be building value and equity. One of the big benefits of being a master franchisee is the chance to constantly sell franchises while building your own sites.

Conclusion

While there are a lot of challenges that come with master franchising, it’s well worth the effort. You’ll serve as a micro-franchisor for your territory, with a chance to recruit new franchisees in your area.

As a master franchisee, you will be relied upon to provide support to all your franchises. This might include marketing, training, or quality control. At the same time, you will have a supervisory role, ensuring that your franchisees comply with all the terms of their contracts, and live up to the standards of the brand.

And yet, if you have a strong managerial style, and the organisational, operational, and marketing skills to effectively achieve this, master franchising has a lot of amazing benefits. It’s the perfect opportunity to grow your business, your skills, your personal attributes, and of course, your profits.

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