Franchising - Considering A Franchise Re-sale

A good franchise becomes an appreciating asset and from time to time for many varied reasons franchisees decide to sell their franchise outlet. We believe that franchise re-sales can provide a double edged business advantage.

The advantage of buying an established business allied to The advantage of buying a franchise

The Advantages

	The business should be established in the area and much of the groundwork done
	There will be established clients which will provide a platform
	Income from day one
	Name awareness in the area
	Trading Figures for the business can be verified against returns made to the franchisor by the franchisee.
	Trading figures and performance can be checked and compared with other franchisees
	All the benefits of buying a franchise
	You may be able to take over existing experienced trained staff
	You will still have all the benefits of buying into a franchise, including a recognised brand, a proven system, training and support.

A Little Care

As with all other business purchases there are still a number of areas that you will need to be careful of. Some points that you may care to consider are:

	Most franchise contracts do not allow the franchisee to sell his franchise unless the purchaser is acceptable to them. Do not spend any money until you establish that you would be acceptable to the franchisor.
	Try and establish why the Franchisee is selling, only proceed if you feel that there are genuine reasons
	Has the business been allowed to run down during the sales process which could leave to unmotivated staff and unsatisfied customers
	If you are taking on equipment make sure that it is in good condition and that it has not been upgraded by new equipment that is a dramatic improvement. Has servicing been carried out and are warranties transferable.
	If you are taking on staff check for any contractual liabilities that you are taking on.
	Are the existing staff motivated and well trained.
	Establish whether you are being expected to take on any business liabilities
	Check the reputation of the business in the area i.e. if you are paying a premium for the business ensure that it has a good reputation
	Your most important business relationship will still be with your franchisor, make sure you understand the role and that you will be able to follow the system that the franchisor has laid down.
	Make sure that the price that you are paying includes full training from the Franchisor and his team.

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