Multi-Store Or Multi-Brand? How Franchise Owners Can Expand Smartly In 2026.
As South Africa enters a new business year, franchise expansion is firmly back on the agenda. From grocery and liquor outlets to education, retail, and service-based brands, more franchisees are exploring multi-unit ownership as a pathway to growth. But while the appetite for expansion is growing, industry experts warn that success in franchising is no longer about scale alone — it’s about strategy, discipline, and timing.
According to Henk Botha, Franchise Specialist at FNB South Africa, 2026 will be a defining year for franchise operators looking to grow beyond a single outlet.
“Multi-unit franchising is becoming increasingly common, but it’s also becoming more complex,” he says. “The businesses that succeed will be those that expand with purpose rather than ambition alone.”
Why Multi-Unit Franchising Is on the Rise
The shift toward multi-store ownership reflects a broader trend in the franchising sector. Established brands are increasingly choosing to grow through existing franchisees rather than onboarding new ones. The logic is simple: experienced operators already understand the brand, systems, and expectations.
For franchisees, this presents a valuable opportunity — but one that requires careful planning.
“Many people assume that if one store works, two or three will work even better,” says Botha. “In reality, expansion introduces new risks, new costs, and a completely different management dynamic.”
One Brand or Multiple Brands? A Strategic Fork in the Road
One of the first decisions franchisees face is whether to expand within their current brand or diversify into new ones.
While both options are viable, moving into multiple brands often comes with restrictions. Franchise agreements frequently limit outside business interests to ensure that franchisees remain fully committed.
“Franchisors want focus,” Botha explains. “They need to know that their brand is your priority. That’s why branching into a new concept usually requires approval — and it will only be granted if the businesses don’t compete for your time or your customers.”
Smart expansion, he adds, lies in synergy.
A grocery store adding a liquor outlet.
A hardware store introducing tool hire.
A retail operation expanding into complementary services.
“These combinations strengthen the business ecosystem rather than fragment it.”
The Hidden Danger of Growing Too Fast
One of the most common mistakes in multi-store expansion is opening locations too close to one another. While this may increase visibility, it often leads to customer overlap rather than real growth.
“You’re not expanding your market — you’re splitting it,” says Botha. “And when that happens, you carry more debt, higher operating costs, and often very little additional revenue.”
The risk becomes even greater when franchisees take on underperforming stores offered at discounted prices. While these opportunities may look attractive, they often come with structural problems that are difficult and costly to fix.
“A cheaper store isn’t always a good deal,” he warns. “If it drains cash from your profitable outlets, it can destabilise your entire operation.”
Cash Flow Is King
At the heart of every successful expansion strategy lies one critical factor: cash flow.
Even well-established franchisees can run into trouble if new outlets take longer than expected to break even. Staffing, stock, rent, and operational costs can quickly outweigh early revenue.
“Expansion should never compromise the health of your existing business,” says Botha. “If a new store depends on another outlet to survive, that’s a red flag.”
Sometimes, he adds, the smartest decision a franchisee can make is to walk away.
From Operator to Entrepreneur
Multi-unit ownership also requires a mindset shift. Running one store is hands-on. Running several is about leadership, systems, and structure.
“Once you pass five or six outlets, you’re no longer just a franchisee — you’re running a business,” Botha explains. “That means formal management, reporting structures, and operational controls become essential.”
Without these, growth can quickly turn into chaos.
Successful multi-unit operators invest in:
- Strong management teams
- Centralised financial reporting
- Clear performance metrics
- Consistent operational standards
The Road Ahead
As 2026 unfolds, franchise opportunities across South Africa remain strong — but only for those who expand with intention.
“The opportunity is real,” Botha concludes. “But growth should be earned, not rushed. The strongest franchise businesses are built carefully, with clarity, discipline, and a deep understanding of their limits.”
In today’s environment, sustainable expansion isn’t about how many stores you own — it’s about how well you run them.