Sell A Franchise – Professional Franchise Resale Services

Professional Franchise Resale Services

Preparation For Sale

Your first step will be to complete our new client questionnaire.  Then you will submit your financial statements/tax returns. (Your information is fully confidential at all times.)  One of our client managers will be available to assist you if you need further assistance.  We will review your provided information, ask you more questions, and ‘recast’ the financials.

Free Business Value (Or 3 Other Levels Of Valuation)

Next, you’ll want to determine which level of business valuation you require.  FOR FREE, and before you make any obligation, we will work with you to ‘recast’ your financials and  determine Sellers Discretionary Earnings. Then we will provide you with an opinion of business value.  If you prefer something more formal, we also offer Detailed and Comprehensive business valuations that are USPAP compliant and signed and certified by our ASA/CVA certified appraisers.  All reports will let you know ahead of time the general parameters of what your company could be sold for.  (Let us know if you’d like to see Business Valuation samples).

Listing Agreement

Once you are comfortable with the established value range and have decided on a ‘go to market’ asking price, you will sign a listing agreement. This allows us to advertise the business for sale, and work with buyers on your behalf.

Business Profile

Next, you’ll email or upload photos and videos of your business location (if appropriate), region, or anything else that will help a buyer understand your business.  We will then produce a customized Business Profile incorporating the content from your questionnaire, the photos/videos you uploaded, branded corporate info, local/regional info, your financial recasting worksheet, and our video interview. (Let us know if you’d like to see a sample Business Profile).

Our administrative staff will schedule a time to do a Zoom interview where we will speak with you as if we were buyers.  We will ask you what you want us to know about your business.  This video will be merged with other photos and videos you’ve provided. The edited version will be about 10-15 minutes long.  This video interview and tour basically replaces the first phone call or onsite meeting with the buyer.  Having this video will allow qualified buyers to “preview your business” without having to schedule onsite showings, thus saving hours of meetings, and further ensuring confidentiality.  (This video is not mandatory, but it becomes a very helpful tool in the sale process).

Buyer Marketing

Typically within 24-48 hours, Franchise Sellers will post your company for sale (confidentially or branded – you choose) on four or more of the major business for sale related websites.  This would cost you over $800 to directly pay for ads on these websites.  We will also post your business on our FranchiseSellers.com business search portal.  (Most sellers prefer that the ads that are generic. We sell “the sizzle” but not “the steak”. Ads are created in a way where the reader will get excited enough to ask for more info, but cannot know exactly what business it is without inquiring further).

Franchise Sellers will also email your business listing as a ‘buyer blast’ to those qualified buyers already in our database seeking businesses like yours, based on location, industry, size, etc.

Buyer Management

As each buyer responds to our ads for your business, the buyer must first complete a Buyer Registration providing that they have the skills and financial resources required to purchase your business, and they must agree to a non-disclosure statement.  This form will be completed and submitted direct to Franchise Sellers from our website. We will review their buyer profile to determine their financial abilities and skill set.

Franchise Sellers will email your Business Profile to each of the qualified buyers.  We will make contact with the buyer a day later to answer any questions, schedule a showing, provide additional information, and more.  We will continue to reach out to each buyer until they either agree to submitting an offer, or they go elsewhere.

Offer / Counter Offer / Due Diligence

In partnership with your other primary business advisors (accountants, attorneys, financial planners, etc.), we will work with the buyer to facilitate their required due diligence, and to negotiate the letter of intent, counter-offer, and asset/stock purchase agreement.

One of our most important roles is to manage expectations, and minimize emotions.  Selling a business is very stressful.  Our due diligence checklist ensures that every step gets its proper attention, including meeting deadlines with landlords, franchisors, lenders, and closing.

Franchisor Disclosure and Discovery

Upon acceptance of an offer, we will quickly introduce the buyer to your Franchisor in order to start the franchise disclosure, discovery, and qualification process.  There are a few deadlines that have to be met before the Franchisor can approve the buyer as a new franchisee.  This includes the buyer receiving the Franchise Disclosure Document (FDD) and going to Discover Day.  It  should be noted that it is common that a closing gets delayed because this step was not taken care of early on!

Business Loan Approval

Your buyer will almost always require some form of financing, whether it be: a conventional loan, asset loan, SBA guaranteed loan, factoring, home-equity loan, or seller financing. The most common business loan by far is the 7(a) Business Acquisition Loan through the Small Business Administration (SBA).  The SBA lending process is long and difficult.  We make sure that the buyer is working with one or more lenders (preferably 2-3) to get loan approval.  This will take 60-90 days or more.  It is on us to ensure that buyers are working with lenders simultaneous to all other aspects of due diligence.

Closing

The closing process is different depending on your state.  It is important that you work with a reputable business attorney and accountant to review (and/or create) all closing documents.  Depending on your state, the Closing will be facilitated by either a title & escrow company, the buyer or sellers’ attorney, or a third-party attorney that represents the ‘transaction’.

Professional Franchise Resale Services