Buying an Existing Franchise Business

Franchise Facts

In the year 2000, franchises made up an estimated $1 trillion in annual retail sales.
Franchises account for more than 40% of US retail sales.
More than 8 million people in the United States are employed by a franchise.
One out of every 12 US retail businesses is a franchise establishment.
Franchises become profitable faster than typical start up businesses.
In 1998 there were nearly $850 billion sales of franchised goods and services at over 700,000 US franchise locations.
A Gallup poll reported that nine out of ten franchise owners say they consider their franchise to be either somewhat or very successful.
The report also found that overall satisfaction in owning a franchise business was high among the more than 1,000 franchise owners polled. "Nine of 10 respondents' expectations were either exceeded (18%), mostly met (48%) or somewhat met (24%)."
The franchisees surveyed in this Gallup poll reported substantial levels of gross income, defined as the amount of money remaining after expenses are paid but before paying taxes. The average gross income reported was $91,630 and 25% of franchise owners reported grossing $100,000 or more in the past year.
Statistics from the U.S. Department of Commerce show that from 1971 to 1987, less than 5% of franchise businesses were terminated on an annual basis.
According to a study by Arthur Andersen & Company in 1991, of 366 franchise companies in 60 different industries, nearly 86% of all franchise operations that had opened in the previous five years were still under the same ownership; only 3% of those businesses were out of business.
The U.S. Small Business Administration reports that from 1978 to 1988, 62.2% of all new non-franchised businesses were ended within the first six years of their operation due to failure, bankruptcy, retirement or other reasons.
SellFranchise.com can be an important part of your team. We know you are in the business of selling new franchise stores. We also know that helping an existing franchisee sell his business is not usually your expertise. That’s where we can be a useful partner.
Our business is finding qualified buyers for existing franchise businesses. Our nationwide service can take the responsibility for selling existing units away from the franchise company, and avoid the negative repercussions associated with the closing of an existing unit.
SellFranchise.com offers many of the services of a business broker at the low rate of just 4%. Our service offers complete security and confidentiality for sellers. We fully pre-screen and pre-qualify buyers before they learn any details of the business being offered for sale. We bring only highly motivated buyers to the sellers of your existing franchises. We will work with you to make sure all of your concerns regarding your agreement with the selling franchisee are met.
Our sister company, Diamond Financial Services, is recognized as a nationwide funding source (SBA & Non-SBA) for franchise businesses. Diamond can help qualified buyers secure the financing they need to purchase one of your existing units and work closely with them through the loan process.
If you are interested in SellFranchise.com helping your franchisees who want to sell, we can set up a custom program for your franchise company. For more information, fill out this form and click send. A SellFranchise.com representative will contact you to show you how we can be of assistance.
Surveys show that a seller who requires an all cash payment usually only receives about 70% of their asking price, where as sellers who accept financing generally receive 86% or more of their asking price. Studies also show that buyers feel more comfortable buying a business with seller financing because they feel that the seller is confident that the business can pay for itself. When all cash is accepted, many buyers feel that the business may not be able to pay for itself.

Sell smart. Save more.SellFranchise.com

Buying an Existing Franchise Business

Franchise Facts

Sell smart. Save more.
SellFranchise.com