Why Buy a Franchise Resale? 8 Benefits to Buying an Existing Franchise

Countless individuals contemplate buying a new franchise each year without giving adequate consideration to buying an existing franchise for sale.  This can be a missed opportunity. While there are benefits to starting with a clean slate and launching a franchise from the ground up, the potential advantages that come with buying an existing franchise resale should not be overlooked.  The amount of time, money, and energy required to launch a new franchise location can easily exceed the limits and expectations of a new franchise owner, even with the system, training, and support of a strong franchisor.

As you weigh buying a new or existing franchise, we invite you to consider the following benefits to buying a franchise resale:

1. Location and set up is already complete – Site selection and lease negotiation are both time consuming and stressful processes, and there is still the configuration and furnishing of the new franchise location.  Taking over an existing franchise location for sale can save hundreds of hours of painstaking decisions, set up work, and expensive new purchases.

2. Customer base and brand recognition are established – New franchise owners can easily underestimate the difficulty, expense, and anxiety that goes into bringing in the first customers and establishing a strong customer base.  These are real challenges, even in a good franchise model that provides a clear launch plan. While some franchise brands are recognized just about anywhere, many brands are emerging and are not well recognized until the brand has been operating in the area for some time.

3. Current employees are trained and working – Buying a business franchise often offers the true luxury of having reliable employees in place.  While there can be employee-related challenges any time new ownership steps in, the benefit of having dedicated, well-trained employees in place cannot be overstated.  Some business owners prefer to hire and groom their own team, but in reality this is often a trial and error process where finding, training, and keeping the right people is much easier said than done.  You can still hire and train your own team when the time is right – it just doesn’t have to happen right away.

4. Existing cash flow Having cash coming in the door from day one is a huge benefit over having to work, wait, hope, and pray for that first dollar.  Buying an existing franchise for sale gives you a business where your focus can be on improving operations and increasing sales rather than worrying about where that first dollar is going to come from.

5. Obtaining financing – Buying an existing franchise that has tangible assets or equipment, existing customers, and a history of reliable cash flow will give lenders more confidence when making a lending decision.  Depending upon the terms of your acquisition and the performance of the franchise resale, you may be able to use the existing cash flow from the franchise to pay for the business.

6. Hands on training from seller and employees You will be required to complete the standard corporate-provided training whether you are buying a used franchise or a new one.  However, buying a franchise resale gives you the advantage of getting some additional insight, practical training, and details from the sellers, especially if you negotiate to have them work with you during a transition period after the sale.  The insight the sellers can offer is oftentimes more specific and insightful, sparing you from some learning curve headaches. The corporate-provided training is essential to your success, but the hands on training and knowledge provided by the seller and their employees in an existing franchise is invaluable.

7. Verifiable data, proven performance, and detailed reports – Revenue, customer lists, sales reports, and other valuable performance metrics are typically available for a franchise resale because of the reporting requirements and the management systems offered by the franchisor.  This enables you to better understand the true performance of the franchise for sale and identify areas of strength, weakness, and opportunity.

8. Inventory and equipment are in place – While the purchase price will likely reflect any inventory and equipment you acquire in a franchise resale, it is a significant savings of your time, thought, and energy to already have the necessary inventory and equipment on hand.

Buying a franchise resale may not be the right choice for everyone, but it is something that every franchise buyer should consider.  Purchasing a new franchise may have a cheaper price tag on the surface, but starting from scratch is a lot of work, still requires a significant dollars, and has little or no existing momentum. All this can change the effective price tag over the course of time.

Franchise Flippers is the world’s premier franchise resale marketplace where serious franchise buyers and sellers connect to get deals done. If you are a franchise buyer looking to find the right franchise, let Franchise Flippers help you!  Contact us today to see how we can help you successfully find, buy, and grow your franchise operation. www.franchiseflippers.com



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