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Do all franchisors offer the option of ‘multi-unit’ ownership?
Whether a franchisor will offer its franchisees the option to operate more than one franchise unit will depend on the particular franchisor and the type of business. However, any franchisor that does grant the option will usually have fairly stringent criteria that must be met.It is fairly unusual for a franchisor to grant the option of multi-unit ownership at the beginning of the franchise relationship, unless the franchisee is prepared to commit to an agreed development schedule, which will inevitably mean that the franchisee agrees to make a considerable financial commitment. Often the franchisor will want to see evidence that the franchisee has the financial resource freely available to meet any development commitments. Typically, multi-unit ownership is offered where the franchisor is looking to expand internationally.Where there is no initial development schedule, it is more common for a franchisor to see how a franchisee performs in one unit before allowing them to open additional units. For example, a franchisor might be willing to offer an established high performing franchisee the option to open additional units or possibly (but a lot less likely) exclusive rights to open units within a certain territory.
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