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brand expansion 2018-06-21

Advantages of Being a Master Franchisee Owner

Here are the right reasons to pick a Master Franchisee and make a winning business model. Read...

By Feature writer
Advantages of Being a Master Franchisee Owner

There are great advantages to being a master franchisee. There is a sense of importance and position that you create from the beginning.

Prominent Position

As the sole franchisee in a particular region or district, you will always have an upper hand. So while you are not really the boss, you are actually the boss. You have a say in how you want to develop the business, depending on the needs of the region and can play your cards you want to. But all this has to be done keeping in mind the ethos and brand philosophy of the franchise in mind.  

Also, you have great opportunity to be a mentor and train people and sub-franchisee according to your own leadership model. At the end of the day, the franchise would want to see its business grow in the most organic manner.

Royalty Percentage

A huge benefit of becoming a master franchisee is the kind of royalty percentage you take home. This is a percentage of all fees paid by franchisees in that region. It can be anywhere from 40% up to 75%. But this is a stage of profit only when you have had more franchisee business coming into your region. 

“The initial fee that master franchisees pay in order to run a region of their own is normally substantial. However, once a solid system of franchisees has been built up, the financial benefits can be huge While making money is certainly a benefit of the role, some master franchisees go even further and become influential in the business as a whole,” shares Legal Vision that deals in setting up and managing franchise businesses worldwide.

Skill Set Advantage

If you are someone who has the potential to pump in money for initial investment, this is the place to do it. With an already established brand philosophy in place, as a master franchisee, you have an edge over everyone else. Also, if you already possess sound managerial experience and love leading a group, here is an opportunity to use your skills.

Ideally, a master franchisee is “one who has the strategic, operational and financial capabilities and commitment to expanding the brand system within their territory. They have impeccable local knowledge and experience in the industry and have a well-thought-out business plan. They exude the entrepreneurial skillset with their vision and passion for business,” Andre Nell, RFG’s CEO franchise.

Manpower management

As a master franchise, it becomes your responsibility to recruit and train other franchisees in that region or territory. So, here is an opportunity to train and groom manpower the way you want. Essentially as a master franchise, you get all the support and pre-training yourself from the franchisor itself. But this is a big responsibility and one should get into a master franchise keeping this point in mind. 

Be prepared to understand that you will be literally running two separate businesses. This gives you a sense of great accomplishment, while it also brings with it, needs for great patience, energy, and maturity to make it work.

“A master franchise essentially runs two separate businesses – one operating a single franchise and the other expanding the franchise company. Each requires different skills and, generally, the companies are set up separately. In both cases, having sales and management experience is a definite plus for a prospective master franchisee,” explains All Business group of experts on franchising.

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