Franchising has evolved well beyond the simple model of one franchisee, one location. Today, the majority of modern franchise systems offer or support multi-unit expansion strategies. These arrangements:
✅ Increase system growth and scalability
✅ Cater to experienced operators
✅ Leverage operational and financial resources
But success starts with understanding the right structure — and how territories are defined, sold, and managed.
In this post, you'll learn:
1️⃣ The three main types of multi-unit franchise arrangements
2️⃣ How each model operates and is sold
3️⃣ How territories are defined and built in each
4️⃣ How Zors helps visualize and manage both unit and multi-unit systems in one platform
📘 What is it?
A franchisor grants one operator ("area developer" or "multi-unit operator") the right to open multiple units in a defined geographic area.
⚙️ How it works:
The developer signs an area development agreement
Commits to open a certain number of units over a timeline
Signs a separate franchise agreement for each unit
💼 How it’s sold:
Covered under the same FDD as single-unit sales
Franchisee signs an Area Development Agreement or Multi-Unit Development Agreement + the first Franchise Agreement
Franchisee pays upfront development fee + first unit franchise fee
Franchisee typically signs the then-current Franchise Agreement as each unit is ready to open + pays any franchisee fees due
📌 Quick Tips:
✅ Developers operate (not sell) units
📅 Must follow development schedule
❌ No resale or third-party rights
📘 What is it?
A franchisor grants a third party ("subfranchisor") the right to sell and support unit franchises within a region.
⚙️ How it works:
Subfranchisor signs a master franchise agreement
Recruits and supports subfranchisees
Shares fees with the franchisor
💼 How it’s sold:
Requires a separate FDD from the one used for unit sales
Often a larger financial and operational commitment
Typically offered over a larger area (state, multi-state or country)
📌 Quick Tips:
🤝 Subfranchisor = mini-franchisor
🧾 Must track multiple relationships (3 layers!)
🗂️ Subfranchisor needs its own FDD with its own Item 20 charts and FDD disclosures
📘 What is it?
A franchisor grants a person or business ("area representative") the right to recruit and/or support franchisees in a specific region — without granting the right to sell franchises.
⚙️ How it works:
Area reps earn a portion of initial and ongoing fees
May provide support, site selection, training or local sales guidance
Do not sign franchise agreements with franchisees
💼 How it’s sold:
Requires a separate FDD from the one used for unit sales
Often for the right to potentially develop over 10-50 unit franchises within a state or region
📌 Quick Tips:
👥 Often confused with brokers — but reps pay to play
🔍 States may classify reps as subfranchisors based on duties, reps may need to be disclosed in Item 2 | 3 | 4 of the unit FDD, and area reps may need to be included as franchise sellers on receipt page
🛠️ Reps don’t own units but influence territory success
How territories are generally defined:
🌎 Large regional rights (cities, counties, or ZIPs)
📏 Often mapped using radius buffers (e.g., 1-2 miles/unit) or a mapped out development area.
📌 Quick Tip: Sites are often approved as you go — not all at once, but can be defined earlier.
How territories are generally defined:
🌍 Exclusive regional rights to sell and support franchises
📋 Subfranchisor sets unit territories, with franchisor oversight
📊 Must track territory commitments and approvals in detail
📌 Quick Tip: Track 3 tiers: franchisor ➡️ subfranchisor ➡️ subfranchisee
How territories are generally defined:
🏞️ Reps get support or sales zones (not always exclusive) where units can be developed and operated
📌 May assist with site selection, sales, and training
📌 Quick Tip: Franchisor retains more control over territory decisions when reps are used - generally defining boundaries and establishing the price for its unit franchise
Zors was built with multi-unit franchising in mind. Whether you manage single units, area developers, subfranchisors, or area reps, Zors supports your structure on a single, unified map layer.
🗺️ Unified Mapping Layer
✔️ Overlay unit and area territories on the same map
✔️ Eliminate outdated PDF maps and disconnected visuals
🧩 Flexible Drawing Tools
Define areas by radius, ZIP, county, or custom polygons
Example:
📍 2-mile radius
🗺️ 10-county region for area developer
🌎 Multi-state zone for subfranchise
🧑💼 Live Walkthroughs with Candidates
Map territories with prospects during discovery day
Get real-time feedback and boost buy-in
📎 CRM Integration
Link maps directly to franchisees, agreements, and leads
Create a full system snapshot by territory
🎨 Color Coding by Structure
Quickly see who owns what: unit vs area vs subfranchise
You set the color coding to match your branding or preference
📅 Milestone Tracking
Set and monitor obligations with built in task tracking (e.g., 3 units/year)
Monitor when developers fall behind
📌 Quick Tip: Zors can help prevent legal headaches by keeping visual records aligned with signed agreements.
Choosing the right multi-unit structure isn’t just a legal issue — it’s a growth strategy. Each model affects:
How you sell franchises
How you train and support operators
How you define and protect territories
✅ Zors simplifies this complexity by offering a flexible, all-in-one territory management system.
Whether you're opening your 5th location or your 500th, Zors provides:
🔍 Clear visual insights
🤝 Collaboration with candidates and operators
📊 Data-backed decision making
🧭 Scalability without confusion
📈 Ready to simplify your multi-unit mapping strategy? Schedule a demo today!
Share:
