Franchise Advice


pre-loved franchise


The


Charlie Dickson explains what you need to consider if you’re thinking of buying a franchise resale


I


nvesting in a franchise resale can have a number of advantages over starting a new franchise as a startup business. A franchise resale represents an opportunity to invest in not only a proven concept, but a proven up-and-running business with an established customer base that still benefi ts from the training and ongoing support of the franchisor.


Franchise opportunities being off ered


for resale usually fall into two categories: those that are performing well and are profi table, and those that have not been as successful for their current franchisee. While both can potentially represent a good opportunity, the risk associated with the latter may be greater. When considering purchasing a franchise resale opportunity, you must identify and fully understand which category the franchise you are considering falls into. In order to do this, you need to obtain answers to specifi c questions, including: • Why is the business being sold? Is it due to the current franchisee wishing to retire, ill health, or wanting to start a new business in a diff erent market?


• How has the franchise performed over the past two to three years? What are the trends and performance of the franchise and, importantly, what are the reasons given for these?


• What is the status of the employees of the franchise? How important is retaining key employees to continue producing future projected results? • If the franchise is dependent on its


46 | BusinessFranchise.com | May 2018


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