Case Studies

How a National Convenience Store Chain Centralized Their Licensing

One of the largest convenience store chains in the world operates over 7,200 stores in the United States alone with the majority owned by franchisees. The company is unique because they frequently build new stores in optimal locations using their own capital and then quickly sell the stores to franchisees. It's a one-of-a-kind turnkey operation.

Challenge

In the convenience retailing industry, every franchise location requires a confusing assortment of five to ten licenses to operate, including a business license, lottery license, food license, health permit, sales tax registration, and tobacco license as the core set. In some instances, the stores may be licensed on behalf of the franchisee. In other cases, licenses are procured in the corporation’s name for later transfer to a new franchisee.

For stores owned by the corporate entity, there is pressure to quickly find a franchisee to purchase the store. In this instance, a time-sensitive process of "changeover" begins. All licenses and permits must be quickly transferred to the name of the acquirer. Corporate may even acquire existing stores from poorly performing franchisees and the reverse licensing transfer needs to take place.

For this particular convenience store chain, the licensing process was the responsibility of the regional offices; or at least it was until 2011. Unfortunately, many details fell through the cracks, licenses were overlooked, and store opening dates were missed. The havoc caused lost revenue opportunities for the corporation and the franchisee. In an effort to address this burgeoning problem, the corporation decided to centralize their licensing at headquarters to reduce turnaround time and inject much needed uniformity into all the possible outcomes.

Solution

Business Licenses, LLC was able to help. We took over the research and filing tasks, while developing processes and work flow systems to capture all the license requirements, centralize the reporting details, and facilitate demanding turnaround times. Because stores were generally required to be licensed in short time frames, a customized work plan was created requiring skillful coordination with franchisees, corporate real estate personnel, and outsourced researchers/filers. Using Business Licenses, LLC’s cloud-based portal and experienced licensing professionals, the flow of licensing information was enhanced and new stores were opened with greater efficiency and speed. The corporation was able to meet more demanding turnaround times required by the franchisees and increase corporate franchise sales and store conversions. Franchisees also benefited by being assured their new stores would be operational on the scheduled grand opening dates, increasing franchisee ROI and overall revenue.

Takeaway

Franchise sales are difficult and competitive, often taking months to secure an appropriate franchisee and location. Corporations offering franchise opportunities can gain competitive advantage and shorten their own internal sales cycle by minimizing the traditional “wait time” that franchisees must endure before actually beginning to earn revenue. Additionally, a central team of licensing professionals armed with a repository of the most current licensing requirements and processes will ensure that franchisee and corporate stores open on time and with little confusion. New stores will earn revenue more quickly and store changeovers will be easier to facilitate using an experienced licensing partner that has the resources to move quickly on your behalf.