Multi-Unit Growth Into the Next Generation
Consider these tips for growing your business and ensuring decades of success.
Growing and maintaining a successful business operation comes with challenges of all shapes and sizes, but when you begin to consider multi-unit growth and then throw family dynamics into the mix, things are naturally going to become more complex. If you are looking to expand your business with your family, it is important to be prepared with a succession plan to proactively promote continued growth and development. Below are several factors to consider for a smooth transition from generation to generation.
Tips for Tapping into Multi-Unit Growth
- Do Your Homework
Determine the best business model for promoting multi-unit development by researching various concepts. A successful business model in one market does not necessarily guarantee it will translate well to another territory, as geographic regulations and practices can inhibit the growth of your business. Franchisees should consider city, county and state ordinances, different tax laws, hiring wages and economic climates before making an investment. Take what you have learned about the markets where you currently operate, and conduct the research needed to ensure that the business model will have a near-flawless transition into the new markets.
When we made the decision to further develop our portfolio of Jiffy Lube service centers, expanding our original 12 locations in Utah by acquiring an additional 16 existing locations in Nevada, we conducted extensive research on the market to ensure a smooth transition of the business. As we were essentially doubling in size, we knew that processes needed to be flawless for both employees and customers alike.
- Secure Capital
Secure ample capital at the beginning of the project to cover operations for your business for a minimum of three to six months − one year would be preferable. In some cases, franchise acquisitions can achieve profitability immediately, while others may require time to develop a strong customer base. Multi-unit franchisees should be prepared for either scenario when planning to grow their businesses. It is always best to be prepared for a longer-than-expected return on investment.
- Plan for People
Hiring and retaining productive employees is crucial to the success of any business. If you are building your business from the ground up, you will need to focus on hiring the right employees. If you are purchasing an existing business, you should allow existing employees enough time to adapt to a new management style for the business to thrive under new ownership.
- Create a Succession Plan
There may come a time when you decide to transition to the next generation. We are currently in this phase. Our three sons have been working in different capacities within the company since they were in high school. Now, the time has come for us to transition the top-level, day-to-day operations of the business to them. We will continue to play an important role as we provide strategic direction and consultation over the next few years, but we are following the subsequent guidelines to ensure a smooth transition.
Tips for Transitioning to the Next Generation
- Everyone Needs to Buy In
Once family members make the decision to have an active role within your business, make sure you have 110 percent buy-in from all parties involved in forming the family business. Each party should have had experience learning the ropes of the daily operations so he has a clear understanding of what it takes to continue to make the business profitable.
- Separation is Key
Keep business and family relationships separate. During business hours, family members need to show courtesy and act professionally while working with family members. When the family gathers outside of a work environment, we recommend keeping business discussions to a minimum. Talk about hobbies, vacations, school − anything but work. This balance is important to happy, healthy relationships.
- Don’t Force Them
Allow family members to explore opportunities beyond the family business. While you are passionate and committed, your family may not want to follow in your footsteps. Family members should follow their dreams and pursue opportunities that help them achieve those aspirations.
Our three sons began working in the family business at a young age and while they each went off to college, they all returned to pursue a career with Jiffy Lube. Initially, we had each of them take over a territory of locations, but over the years, we have found that having them in individual executive roles is the best strategy for generational growth that allows us to be successful.
Once you have done your background research and homework, don’t overthink it. Take the plunge − the reward will be worth it.
Dave and Joye Griffin are one of the largest Jiffy Lube franchisees in the system, owning and operating 56 Jiffy Lube locations across Utah, Nevada and Colorado. Find them at fransocial.franchise.org via the directory.