How to Strategically Diversify Your Health and Wellness PortfolioAuthor: Smoothie King
Once a rarity in the world of franchising, multi-unit owners are now the norm.
Multi-unit franchise operators control 54 percent of all franchised businesses in the United States. And while the trend continues to grow, there is a burgeoning subset within this segment of franchisees: multi-brand ownership.
The reasoning behind multi-brand ownership is straightforward enough. Portfolio diversity protects you from potential instability and risk. And given the turmoil that the first half of 2020 has brought, the advantages of this business development strategy are all too clear.
As of the end of June, 41 percent of 140,000 businesses listed as closed on Yelp have permanently gone out of business.
From gyms to retailers to beauty concepts, the ongoing coronavirus pandemic has thrown into stark relief the shortcomings of certain business models in adapting to social distancing and maintaining the health and safety protocols.
Diversifying with a complementary brand can help you avoid a scenario wherein all of your investments are compromised by unforeseen economic forces.
Knowing how to Complement the Current Brand(s) in Your Portfolio
Once you’ve established that multi-brand ownership is the right move for you, it’s important to research and decide which brands you want to add to your portfolio.
- Work within a Familiar Framework
If it’s your first expansion outside of a single concept, look for opportunities that will complement your existing investments but are sufficiently differentiated.
- Stick with Your Passions
If your passion is health and wellness, identify brands within that category that offer products or services that align with your passions.
- Find a Concept that Adds Value to Your Existing Portfolio
Complementary brands should be mutually-beneficial to successfully maximize your investment.
There are some important questions to ask yourself before choosing the brands you want to add to your portfolio.
- What is my current guest profile?
- Will the franchise opportunity you’re considering appeal to those customers?
- Does this brand compete with any of my existing brands?
- Are there available locations in my area?
- Is there a way for me to cross-promote these brands?
By answering these questions, you can choose the best franchise investment to add to your portfolio that complements other concepts you’ve already invested in.
Creating a Well-Rounded, Advantageous Health and Wellness Portfolio
For those with portfolios geared towards gym and/or boutique fitness concepts, think about investing in health and wellness food concepts. They can organically fit into your portfolio and yield advantages that adding other fitness concepts will not.
Even in the middle of a global pandemic, we have seen our franchisees adapt to new challenges and leverage the strengths of our business model to keep serving their loyal guests. For example, the Smoothie King model enables franchisees to offer delivery, operate a drive-thru or provide curbside pickup options to guests. As a result, franchise owners can continue to deliver services to their communities under any circumstance.
Additionally, the products that a franchise brand like Smoothie King offers consumers align perfectly with those who are seeking ways to improve their fitness, achieve specific wellness goals or abide by specific diets, such as keto or vegan nutritional regimens.
Meanwhile, many fitness concepts have had to pause their operations due to health concerns and have not been able to meet the benchmarks for reopening according to the guidelines established by the Centers for Disease Control and Prevention.
Investing in a concept like Smoothie King can help ease the pain countless franchisees face as their businesses remain shuttered and continue to see cash flow tighten.
Consider Multi-Brand, Multi-Unit Ownership
Multi-brand ownership is a great way to diversify your portfolio, continue to deliver complementary services to similar consumer demographics and provide protection against a single-market downturn. For franchisees looking to diversify with additional brands, the strategies laid out above can help you develop a franchise portfolio that makes sense for your purposes.
Smoothie King’s mission is to inspire people to live healthy and active lifestyles, and we take pride in our wide selection of high-quality, delicious smoothies that are each blended for guests’ specific purposes, goals and ambitions. Smoothies are a great fast-food alternative and can jumpstart the journey towards a healthy lifestyle through diet and nutrition.
Adding Smoothie King to your selection of health and wellness concepts not only creates a well-rounded portfolio but also offers up unique qualities in comparison to your current franchise investments.