Services Company Takes Strategic Approach to Reacquire Franchises to Accelerate Growth

Services Company Takes Strategic Approach to Reacquire Franchises to Accelerate Growth

Challenge: In order to accelerate growth, a US based service company made the strategic decision to reacquire its franchises. The company needed to understand how to value the franchises, best communicate the decision to the franchise owners and customers, and acquire the franchises in the quickest and most effective manner possible.

Assessment: Blue Canyon performed detailed research and analysis to determine the most accurate method for valuing the franchises and the appropriate market benchmarks for setting offer prices. Blue Canyon also worked closely with the client to develop the messaging and process for communicating the decision to the franchises. Various mechanisms and incentives were explored to maximize acceptance across the franchise owners and execute acquisitions in as quick a time frame as possible.

Strategic Solution: Our valuation approach ensured that offering prices would be attractive to franchise owners to motivate action. Communication was developed to clearly explain how valuation was determined and how the reacquisition was a win-win for both parties. Incentives were implemented around the offering price to encourage a timely decision making process.

Result: The client was able to confidently value and present offers to 20 franchises to enable a smooth reacquisition of the locations with minimal disruption to the business. Through the reacquisition of the franchises, the client is expected to increase the growth rate of these locations by 50% over the next 2 years.

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