What Are Franchise Units? Single- and Multi-Unit Ownership, Explained

Understand the differences between types of franchise units, including single-unit and multi-unit franchise options. We break down the benefits of each.

What Are Franchise Units?


The franchise industry offers various opportunities for potential entrepreneurs to break into business ownership. Depending on how big your leap into business ownership will be, a prospective franchisee can opt for a single-unit or a multi-unit franchise. Understanding your options is essential as it not only influences your initial investment but also impacts the trajectory of your growth and your day-to-day operations.

Franchise units refers to an individual business location or operation under a larger franchising brand. It involves a franchise agreement where the franchisor grants the franchisee the rights to use their business model, name, and support systems in return for an upfront franchise fee and ongoing royalties. A franchise unit typically includes:

1. Rights to brand and system: The franchisee has the right to use the company’s established brand name, trademarks, and operating systems.
2. Training and support: Franchisees receive training on how to run the business, ranging from daily operations to marketing strategies.
3. Exclusivity: Depending on the agreement, a franchisee might have exclusive rights to operate within a particular territory without competition from other franchisees of the same brand.

What’s the difference between a single unit and a multi-unit? A single-unit franchise refers to the ownership of a single franchise location. A multi-unit franchise denotes owning of multiple locations. Under this model, the franchisee commits to opening a specified number of locations within a defined period. The agreement could involve opening several units simultaneously or over time.

Differences in Ownership Experience


Choosing how you want to own a franchise business involves knowing what makes the different types of ownership different. Here are a few key areas where how many units you own varies your experience:
1. Scope of management:
o Single-unit: Owners often involve themselves deeply in day-to-day operations. This might involve managing staff, overseeing inventory, and engaging with customers directly.
o Multi-unit: Owners are more likely to adopt a supervisory role, delegating daily operations to individual managers at each location. Their focus shifts to bigger-picture responsibilities like multi-location coordination and overarching business strategies.
2. Investment and potential returns:
o Single-unit: Typically requires a lower initial investment since you’re only setting up one location. The potential returns, however, are limited to the performance of that single unit.
o Multi-unit: A greater initial investment is needed due to multiple locations. However, the potential for higher returns is also significant if all units perform well.

Transitioning from Single to Multi-Unit Ownership


Many franchisees start with a single unit to understand the business and then gradually expand to multiple locations, especially if they’re new to the business world. It’s a great way to learn without being overwhelmed by managing multiple locations. Franchisors sometimes even prefer this; it allows them to gauge a franchisee’s capabilities and dedication. If you’re successful with one unit, you may be given opportunities or incentives to expand to multiple units.

Depending on the franchise system and your financial capability, you might have the option to begin with multiple units right from the start. Some franchisors provide multi-unit deals if they’re eager to expand in a particular region. However, it requires a higher investment and the ability to manage multiple operations simultaneously.

Toasted Yolk Café: The Benefits of Ownership


Starting a business is a big decision. With Toasted Yolk Café, you have the benefits of a franchise partnership. What does that mean? Whether you own single or multiple units of Toasted Yolk, you enjoy the quality of life and employee satisfaction that come with our one shift daytime operation. Our chef driven menus attract customers with the money to spend on our premium foods and quality dining experience resulting in a per person check average of $16. You’ll receive personalized and meaningful support that begins the moment you sign the franchise agreement. We only win if you win, too.

Toasted Yolk is dominating the competitive South Texas market and is rapidly expanding into new territories. If you meet our qualifications, want to open one or more Toasted Yolk Cafés, we want to hear from you. Request information today.

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