Since our establishment in 2007, we’ve been committed to helping franchisees achieve strong returns when selling their businesses. This year has underscored just how crucial franchise resales are to the overall health and expansion of franchise networks.
Contrary to the misconception that franchise resales are a negative, they actually present valuable opportunities. Resales bring in fresh, motivated franchisees who can revitalise a network and drive further growth. At Franchise Resales, our focus is on ensuring these transitions are smooth, beneficial, and strategically sound for everyone involved.
Resales as a Strategic Advantage
Throughout 2024, we’ve seen firsthand the importance of a well-managed resale process. We’ve collaborated closely with numerous franchise brands, facilitating seamless transitions between outgoing and incoming franchisees. This careful management not only helps maintain brand consistency but also allows new franchisees to step into businesses with a solid foundation and a proven track record.
We believe that franchise resales should be viewed as a strategic advantage rather than a setback. When a franchisee decides to sell, it’s often the culmination of a successful business journey, not a failure. Whether they’ve met their financial goals or are simply ready for a new chapter, our role is to ensure the resale process is efficient and fair.
Our process begins with a thorough appraisal of the business to determine its true value, taking into account factors such as financial performance and market conditions. This accurate valuation allows us to market the franchise effectively, attract motivated buyers, and ensure a successful transition.
Growing Demand and Our Expanding Team
2024 has been a pivotal year for Franchise Resales Ltd, with more franchisors recognising the critical importance of managing resales effectively. We’ve partnered with a diverse range of brands, helping many franchisees achieve excellent returns while injecting new energy into their networks. The increasing demand for our services has even led us to expand our team, ensuring we continue to provide the high level of service our clients expect.
The Three Ways Out
At some point, every franchisee will leave their network, and there are three primary ways to do so: termination, closing the business, or selling it. Selling, or resale, is undoubtedly the best option for all parties involved. Franchisees get a return on their investment, and franchisors welcome a new owner to keep the business running smoothly.
However, a successful resale involves more than just the buyer and seller—it also involves the franchisor. As a franchisor, you’ll need to manage the release of the outgoing franchisee from their agreement and onboard the new franchisee with a new contract. This creates a triangular relationship that requires careful coordination.
Timing and Efficiency in Resales
The timing of a franchise resale can be tricky. If the buyer is new to the network, they’ll need training, but the franchisor naturally won’t want to begin that training until the sale is certain. Additionally, the franchisor can’t grant exclusive rights to the same territory to two parties at once, making it essential that the right documents are signed at the right time. Everyone involved needs to be clear on what should happen if the sale doesn’t go through.
Delays can complicate the transaction, leading to increased communication and higher costs. A more streamlined approach is for the franchisor to be a part of the sale and purchase agreement. This ties everything together, making the seller’s release and the buyer’s commitment contingent on the sale going through, all within a single document. That’s why the team at Franchise Resales works closely with solicitors, the franchisor, and both the buyer and seller to ensure a seamless transaction.
Looking Ahead
While managing resales requires time and effort, leading the process makes it more efficient, often less expensive, and ultimately a more positive experience for everyone. At Franchise Resales Ltd, we’re dedicated to making this process as seamless and successful as possible for all parties involved.
As we reflect on 2024 so far, we’re proud of the progress we’ve made, but we’re even more excited about what lies ahead. Resales are not the end of a journey—they’re the start of a new chapter, filled with promise and potential. The future of franchise resales is brighter than ever, and we’re thrilled to be a part of it.
This article is provided by Emma Bohan, operations manager at Franchise Resales Ltd, a specialist business brokerage dedicated exclusively to franchise resales. Their focus on resales allows them to provide the full attention these transactions require. Franchise Resales Ltd offers a range of comprehensive services, including business appraisals, marketing, negotiations, and coordination among all parties, ensuring a smooth and efficient sale process.
