27% of prospective franchisees seek a business to fit existing premises

Having premises already available is becoming an important starting point when choosing a franchise in Russia. As Forbes reported on 23 October, 27% of prospective franchisees have owned or rented property for which they need to find a use. For the franchising sector, this creates a particular requirement: the entrepreneur needs not just a new business, but a format that suits an existing asset.

Premises first, business second

The Forbes article cites two figures illustrating the role of property in franchise selection. Alongside the 27% of prospective partners with premises already available, it refers to LeaderFranchise surveys in which 35% of respondents name suitability for an existing location as their main requirement when choosing a franchise.

These figures describe different circumstances. The first indicates that a prospective partner already has property available; the second reflects the importance of matching a business format to a particular location. It would be incorrect to add the figures together or treat them as a share of all signed franchise agreements: they concern prospective buyers and survey responses, not completed deals.

It is also important to note that existing premises are not necessarily owned. The data cited by Forbes includes rented property. The demand described therefore extends beyond commercial property owners seeking additional income: it also includes entrepreneurs looking for a use for premises they have already rented.

In practical terms, this approach changes the order of selection. Rather than starting with an appealing concept and then finding a site for it, the entrepreneur starts with a specific space. Its potential and limitations become the starting point for discussions with a prospective franchisor.

Diversification rather than a standalone launch

Yury Mikhailichenko, president of the Russian Franchising Association, attributes interest in these solutions to entrepreneurs’ desire to improve business efficiency and generate income from different sources. In his view, franchising helps businesses enter new sectors and put idle assets to use.

In this scenario, buying a franchise is an extension of existing business activity. Its purpose is not necessarily to replace the core business. It may complement it, make use of spare space or create another revenue stream. Forbes identifies asset diversification and improving the efficiency of an existing business among the main current motivations for buying a franchise.

However, having property available does not in itself establish that the chosen concept will succeed. The published figures describe prospective partners’ motivations, but provide no basis for promising a particular return or payback period. Assessing a specific project requires a separate financial appraisal based on the premises and the terms of the franchise arrangement.

This distinction matters in negotiations: the desire to put an asset to use explains the interest in a franchise, but does not replace checking whether the proposed business model is suitable for that asset.

Which formats complement an existing business?

A survey of franchisors conducted by Forbes Franchises shows that the most popular ways of combining businesses currently involve property. Examples cited include opening parcel collection points in premises next to retail outlets, and adding services to shops and cafés, such as charging stations and vending machines.

What these options have in common is the use of an existing site or neighbouring premises. But they do not constitute a single, universally applicable format: a collection point, a vending machine and an additional service meet different needs. The survey’s list should be treated as options to explore, not as a ready-made solution for every property.

Mikhailichenko offers another example: a warehouse business could be complemented by a storage or freight transport franchise. Here, the link between the core asset and the new activity is particularly clear: the entrepreneur is considering a business directly related to the use of warehouse space.

Mikhailichenko also sees potential for operating multiple franchises in Russia’s regions where local service infrastructure is still developing. In the scenario he describes, one entrepreneur opens different types of businesses needed by a town, ranging from a hotel and café to a household services centre and bicycle hire. This is an expert assessment of potential opportunities, not a report of completed openings or measured growth in such projects.

What to consider when choosing a franchise

For a prospective partner, the central question is how well the franchisor’s offering suits the specific property. Before discussing a launch, it is useful to compare the concept’s requirements with the characteristics of the premises, and separately identify the alterations and expenditure needed. Having space available should be a starting condition for the financial assessment, not an argument for buying any available franchise.

Franchisors, in turn, should distinguish between two requirements: establishing a standalone outlet and adding a new line of business to an existing operation. Partners interested in the same brand may have different aims: one may need to use vacant premises, while another wants to expand the range of services at an operating site.

Practical takeaway: if you already have premises, start your franchise search by checking whether the business format and location are compatible. The Forbes data shows how common this requirement is, but an investment decision should rest on a financial assessment of the specific project.