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How to Find the Right Franchise Location

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How to Find the Right Franchise Location
How to Find the Right Franchise Location

If you’ll need an out-of-home place to run your franchise, what they say about real estate also applies to franchises: location, location, location!

If your business is not situated in a place that will draw customers, your business cannot succeed.

Traditional vs. Non-Traditional Locations

Before you decide on the where of your location, you’ll have to decide on which type of location you will open. Different franchises come in different shapes and sizes, meaning there are different places that a franchise unit can fit. These fall under traditional or non-traditional setups.

Traditional locations are typically free-standing units, meaning the building the franchise is housed in is only used for that franchise. These locations usually have their own dedicated parking lots.

Non-traditional locations operate a smaller footprint, typically as part of a mall, retail store, shopping centre, airport, university, hospital, gas station, and more. Non-traditional locations could be small brick-and-mortar stores or kiosks, carts, or food trucks.

Researching the Right Location

Start your search with what you know. Chances are, you know your potential area better than you think, especially if it is a local area in your own neighborhood.

Consider these key factors:

  • Accessibility—Is it easy to find and get to? Is there convenient parking?
  • Traffic—Is there a continual flow of pedestrians nearby? Are the streets laid out for easy automobile access to the site? Is it convenient to public transportation?
  • Visibility—Can the site be easily seen and from how far away?
  • Community—Is this an up-and-coming neighborhood or one in decay?
  • Local competition—How many other similar businesses are in the neighborhood?
  • Size and layout—Does it meet the operational requirements of your business? This is where franchisor approval of the site is critical.
  • Condition and construction—How much remodeling will be required, and what will it cost?

Another essential consideration for finding the right location is the demographic of the area—not only do you need a concentration of customers, but a pool of prospective employees too.

Study what activities typically generate traffic in the area – ball games, movies theaters, retail shops etc.—and how often, the times of day, and the seasons of the year people frequent the area.

Other franchisees may be helpful to you as well. If you live in a large city, there may be franchise locations for your brand in operation already. Most franchisees are willing to share their experience, and you won’t really be competing with other franchisees because locations are spread across the city. Ask them how business is in their area, what they might have done differently, and what sort of competition they face.

Other franchisees may be helpful
Other franchisees may be helpful

The Franchisor’s Assistance in Finding a Good Location

And don’t forget about the franchisor. Your franchisor is going to want you to find the best location possible. After all, their success is tied to your success.
Many franchisors provide guidance to their franchisees in regards to location selection and lease negotiations.

Some franchisors do demographic studies of referral sources, population density, cost of living, and quality of life to assist franchisees in scoping out a location. This can be a big boost in finding an optimal site.

In addition, most franchisors by way of their franchise disclosure document give incoming franchisees guidelines on where their franchise can be located. Most franchisors even reserve the right to approve the location you choose before finalizing the franchise agreement—you'll know you're on the right track.

Franchisors Provide Guidance to Franchisees
Franchisors provide guidance to their franchisees in regards to location selection and lease negotiations.

Finding a good franchise location is not a process that should be rushed. With franchise agreements that can last up to 20 years, or longer, taking the time to find the right location is crucial to making your franchise business as successful as possible.

Where will you open your franchise business? View Top Franchise Opportunities in Canada here.

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