The Dangers of Hyper Growth

US nutrition supplement franchise, Complete Nutrition, learnt the severe repercussions of hyper growth the hard way, having to impose a 15 month freeze on any new franchise sales. Here’s why.

The Dangers of Hyper Growth

The short answer is sustainability — the brand and business model simply couldn’t keep up with the massive growth.

Though the franchisors had years of experience in the nutritional supplement franchise industry as managers, it wasn’t enough to prepare them for rapid growth.

Having opened their first store in 2005 they started franchising in 2008. By January 2010 they had 19 locations. Though they planned on awarding 18 franchises that year, they sold 245 franchises in 15 months and turned away a fair number too.

Then came the growing pains

The brand simply didn’t have the capacity to keep up with the number of stores opening, training needs, franchisor support, marketing and product demand. So, in March 2011 they froze all new sales, let go of some franchisees and focused their attention on training and recruiting the best office team they could, going from a team of 20 to 60 by June.

Hefty lesson learnt, the brand now plans to open another 120 stores in the next three years and 1 000 stores by 2025.

Perils of Exponential Growth_Franchise Zone

Tracy Lee Nicol
About the Author
Tracy-Lee Nicol is the managing editor of Franchise Zone Magazine and deputy editor of Entrepreneur Magazine. She studied her Masters degree in Art History and Visual Culture at Rhodes University and spent the next two years working and travelling in Asia. Her love of people, business and teaching is reflected in telling the stories of entrepreneurs, franchisees and franchisors, inspiring others to take the leap to being their own boss and bringing about positive change in South Africa.

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