From Ice Cream to the Internet: Using Franchising to Drive the Growth and Profits of Your Company

Chapter 7. Territorial Strategies

To be successful as a franchisor, you need to determine the right strategy toward managing geographical territories. As was explained in earlier chapters, franchising tends to occur in industries in which sales and profit growth come from the addition of outlets to the system rather than the expansion of operations at existing locations. Consequently, figuring out how to expand the geographic reach of the system is crucial to success. If you adopt the wrong territorial strategy, you will almost certainly hinder your franchising efforts and might undermine an otherwise productive system. But the right territorial strategy is far from easy to determine.

In general, an effective territorial strategy has three broad ...