A Comprehensive Guide to Selling Your Franchise as Fast as Possible

If you’re a franchise owner who’s looking for ways to sell your business, you may be overwhelmed with where to start. It can be a difficult and tedious process. But if you follow these steps, you can be well on your way to selling your franchise and moving on to the next venture in your life.

Step 1: Contact Your Franchisor

The moment you decide to sell your franchise, your very first step should be to reach out to your franchisor. They possess valuable industry knowledge and may already be aware of potential buyers interested in taking over your franchise, which could lead you to find a buyer faster than if you were to search for an interested party on your own. Also, as the Minnesota-based franchise lawyers at Garner, Ginsburg and Johnsen note, many franchise agreements contain strict limitations and rules regarding franchisees’ ability to sell their franchise. This is another reason why it’s crucial to contact your franchisor before you try to sell.

“A franchisee’s ability to sell or pass down his or her business is also limited by the franchisor’s requirements, transfer fees, and approval of the transferee,” the franchise lawyers report.

Of course, while the level of support can vary based on your franchisor, it’s absolutely essential to inform them of your intention to sell as soon as possible so they can provide you with assistance.  

Step 2: Prepare for the Sale

To position your franchise for a simple and efficient sale, you should also be thoroughly prepared to step down from your ownership position. When it comes to preparing for the sale, start by conducting an evaluation of your franchise from head to toe. Determine the most accurate value of your franchise by scouring through your financial statements, evaluating your franchise’s reputation and customer base, and ultimately, its growth potential. By doing this, you’ll be able to set a realistic asking price to attract potential buyers.

Additionally, another part of the preparation process is making sure your franchise is appealing. First impressions are important. While the physical appearance of your franchise will play a factor to some extent, you also need to clean up the back of the house. Be sure to organize your financial records, tax returns and balance sheets. Make sure this is all up-to-date as prospective buyers will go through these documents with a fine-tooth comb. By presenting a well-maintained front, you’ll be more likely to instill confidence in a buyer.

“The buyer for your business is going to ask to see the numbers,” notes franchise consultant Kimberley Daly. “They want to justify the asking price you’ve put on your business, so have your tax returns ready. In addition to your tax returns, have your story straight. They want to know, ‘If this business is so great, why you are selling it?’”

Step 3: Market, Market, Market

Once you’re prepared for the sale, the next step is to search for a buyer. When it comes to selling a franchise fast, this is going to be the most difficult aspect of your experience. As such, marketing your franchise effectively will be extremely important. In order to do so, create a comprehensive marketing strategy that utilizes everything from print marketing to social media and industry-specific websites, such as BizBuySell or Franchise Gator. Putting together a sales package that highlights your franchise’s history, unique selling points, financial performance and growth potential will also help you stand out from other franchises on the market.

Step 4: Consider Working with a Business Broker (Optional)

While optional, teaming up with a business broker can help expedite the selling process. Brokers tend to have access to a wide network of interested buyers and have the capability to assist you with negotiations and paperwork. If you’re looking to sell your franchise and be done with it, partnering with a reliable business broker increases the likelihood of a fast sale.

Again, this step is totally optional and isn’t required to sell your franchise. However, it can greatly benefit you if you’ve never sold a franchise before. If you have experience and understand the industry, you may be better off going through the process on your own. Ultimately, this depends on your own industry experience and preferences.

Step 5: Negotiate and Seal the Deal

Once you find an interested buyer and have successfully navigated negotiations, you’re nearly done. Congratulations! With an agreement in place, you can take the final steps to sell your franchise. This includes officially transferring your ownership rights, completing any outstanding legal documentation and ensuring you’ve completed all obligations on your end. And that’s it. You’ve sold your franchise in five steps or less!

The Wrap-Up

Of course, selling your franchise is a process, and it’s a lot easier said than done. It requires careful planning and preparation. But by following the aforementioned steps, you’ll be on your way to attracting potential buyers and closing a deal in no time.