Selling A Franchise
You have most likely come to a decision to sell your franchise, or are seriously contemplating selling,
based on a particular set of circumstances:
- it might be the end of your lease or your franchise agreement;
- you think it is the right time to exit this franchise agreement;
- you have achieved your business objectives and built up some value and you would like to benefit financially from this hard work and value growth, or
- you might just want to spend more time with your family, or change direction.
Whatever the reason to sell, remember that no one will know your franchise as well as you do. So if you are hoping to identify a potential purchaser that will recognise value in your business, there are a few critical things you should think about during the pre-sale and transaction process.
We've included a Seller's checklist to help you prepare for a sale of your franchise:
- Know what $ range the market will value your franchise at and what the likely interest will be and the probability of a successful sale.
- Have your current and most recent financial year accounts up to date, reviewed and compiled by your accountant.
- Make sure you are aware of the franchisor’s requirements for selling your business, including the candidate (prospective purchaser) assessment process.
- Be confident that you have done everything to ensure the financial, business, statutory and operational aspects of your business are well documented so they can be communicated professionally to a prospective purchaser.
- Communicate your intentions with your staff transparently at the appropriate time.
- Consider what advice and assistance you might need to market your business professionally and to manage and negotiate with prospective buyers. Selling a franchise takes time and usually needs 100 per cent focus to achieve a good result.
Remember what it was like when you purchased the franchise? If you built it from scratch, remember what it was like dealing with a financier for the first time to get a loan? You or your bank wanted clear and credible information about the business, including how it operated, what exactly you were investing in, and how it was performing. JPAbusiness will work along side you to show your business in the best light so potential purchasers can answer the questions you once asked.
Do you need professional help in selling your business?
It is worth considering whether you are the best person to sell the franchise and represent the information on the business, or whether you should appoint an advisor/broker to assist you?
Questions to consider here are:
- Have you got the time and know-how to actively market the franchise and also keep running the day to day operations?
- How do you tap into the target market of prospective buyers without wasting time and money?
- Are you able to manage the candidate assessment process with your franchisor?
Above all, preparation and planning for a franchise sale is the most important factor in lifting the probability of success.
At JPAbusiness we don’t start the selling process by suggesting you advertise your business in a glossy brochure or catalogue.
The key to a successful franchise business sale is a factual, comprehensive and professionally prepared description of your business, identifying the target market as to who might be interested and what they are likely to pay for your business. We then design and execute a co-ordinated and comprehensive marketing program that gives you the best potential to achieve your sale objectives.
Our difference is about planning for a successful sale, rather than hoping for a successful sale.
Click to download our Selling a Business Checklist.