Launch The Direction

You should decide early where you will expand through franchising. Typically, franchisors cluster locations within established markets because these markets have been successful. Adding franchised locations within an established market will generate additional funds for advertising in the market, thereby enhancing market share as well as helping seal out competition. Sometimes established markets are not readily available. When deciding whether to enter areas where there are no existing units you should consider:

• Your ability to service and supply the location.
• Whether there is run-off value of your trademark or reputation that might precede the franchisee in the new locale.
• The sale potential of the new market area.
• The level of competition that exists in the new market area.
• The population, income, retail sales and other demographic factors that may influence the success of a market area.