What to do when the Economy Improves

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Franchisees struggle during hard times just like other business owners, and some fail. Those who survive, however, are often in excellent position to grow once better times return.

Why? Because they have been tested, and they often find that their franchisors, having been tested themselves, need help getting back into growth mode - and who better to provide that help than a franchisee with really good survival skills?
 
If you're among those resilient franchisees who will survive the current downturn, here's the key to getting yourself into position to prosper once things improve: Start thinking now about becoming an area developer or a master developer.
 
Area developers hold the right to open not just one but a number of franchise outlets in a specific exclusive territory, usually within a specific period of time. Area developers populate the territory with self-owned units. Master Developers "seed" their exclusive territory with outlets of their own and then work with their franchisor to recruit, train, and support other franchisees in opening up additional outlets in the same area.
 
It costs money to become an area and master developer, of course; franchisors don't give exclusive development rights away for free. And there are risks. As an area or master developer, you may lose your exclusive rights in your territory if you fail to meet strict deadlines in getting new outlets up and running, whether under your own ownership or that of new franchisees.

Last but not least, it takes careful analysis to decide whether to develop anew territory altogether with your own outlets or "seed" it and then help your franchisor bring in new franchisees. It takes work to negotiate a deal with your franchisor, too, of course, generally on the amount and sharing of initial and continuing fees and the development period for getting the outlets open for business, so don't try to go it alone. An experienced franchise attorney is often the key to getting these deals done.
 
Becoming an area or master developer isn't a cakewalk, another words; you double down the bet you make as a franchisee, and you work ten times as hard. But it's the next best thing to becoming a franchisor yourself. Indeed, given the obvious opportunities for leveraging time and money, it's the way up for franchisees who prove themselves in hard times.