Can You Take A Complement?: Complementary Franchises Deliver Opportunity for Multi-Unit Franchisees

In this sluggish economy, home-based franchises--or businesses you can run out of a home office--are some of the fastest out there. While many of the opportunity seekers purchasing home-based are first-time franchisees or business owners, the trend toward home-based franchises presents an opportunity for current franchisees, too, in the form of complementary franchises.

What is a complementary franchise? In its most basic form, it is when a business owner utilizes the existing infrastructure for his or her business to run an additional business that complements--not competes--with the sales and operation of the primary business.

Fast and lend themselves particularly well to complementary franchises. For example, a that specializes in donuts, and other breakfast-type items purchases a franchise that sells products to outlets and other high traffic locations.

While the primary business--the or convenience store--draws a certain amount of foot traffic, the customer that comes in looking for a cup of may not be thinking of an ice product during the morning. But, if it is afternoon and they are looking for something different to go with their afternoon an ice cream bar might just hit the spot. Hence, you have the complementary franchise.

Of course, that is a complementary franchise in its simplest form. For the entire concept to truly work, your franchise needs to be able to share more than foot traffic. Some of the things needed to make a complementary franchise work:

  • Physical location - Obviously, to share traffic, there needs to be enough space at your current franchise locations to accommodate the complementary franchise. That goes beyond some extra room for a freezer or shelf for product. You need to be able to accommodate any special supplies for the complementary business as well as storage space for necessary inventory. You will also need to consider future growth.
  • Transportation - Can you use your existing transportation--e.g. trucks, vans, etc.--for necessary deliveries for the complementary franchise? Is there enough cargo space or will you need additional vehicles or additional trips per day? Ideally, you can accommodate both franchises with your current fleet. At the very least, if additional transportation is needed, the additional revenues generated by the complementary franchise will justify the cost.
  • Staff - Again, you want to select a complementary franchise that doesn't require additional staff--at least not right away--so your current sales/customer service staff can handle the extra volume.
  • Marketing materials and execution - A complementary franchise can present additional marketing opportunities. Beyond including the complementary franchise in your marketing materials and website, the new franchise should also invite opportunities for cross promotion (e.g. buy new product get 50 percent off primary franchise's product).
  • Accounting and other operational systems - Ideally, you want to be able to utilize the same and operational procedures so that the complementary franchise does not create an unreasonable amount of new work.

In a perfect world, the complementary franchise utilizes every system and plan you have in place so that it's a seamless transition to selling the new product or service. Unfortunately, it's not a perfect world and you should probably expect to tweak here and there to accommodate the complementary franchise.

On the other hand, the complementary franchise might present opportunities for revenues beyond your current franchise Once you have your complementary franchise up and running and can demonstrate how it can operate in unison with your primary franchise, you now have something to market to fellow franchise owners of your primary franchise. Sure, they might want to purchase a complementary franchise of their own if they are multi-unit owners. That would not be such a bad thing. Many franchisors offer rewards for referring new franchisees.

Chances are that not every one of your fellow primary franchise owners will be in a financial position take on a complementary franchise. If you are selling a product with your complementary franchise, you can perhaps create a distribution opportunity that can create additional revenue for your fellow franchise owner and you.

The current economic climate has tested the resolve of all business owners. Running a leaner operation can help improve the bottom line but it will probably not significantly increase your gross. A complementary franchise offers a way to grow your business without a significant cash investment. Better yet, it gives you a revenue generating means without significantly increasing overhead costs for space or staff. Not to mention offering your customers additional purchasing opportunities or value. And that will go a long way towards surviving and thriving in today's economic climate.

Susan Morris is a senior vice president with Natural Fruit Franchise Group, makers of Chunks O' Fruti® 100% natural frozen fruit bars. For information, please visit

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