How Do I Sell My Franchise?

On Monday, we spoke with Tom Taulli of BizEquity about valuing a franchise for sale. Tom said a key to a valuation of a franchise is your cash flow.

So now, you might be asking yourself, “How do I sell my franchise?” or “Will my franchisor allow me to sell my franchise?” or “Will my franchisor expect to be paid from the sale of my franchise?”

All of the above questions are valid concerns. You can find the answers to questions two and three in your franchise agreement. Sometimes, the franchisor will include certain stipulations as to whom, or how much the franchise must be sold for. If you are unclear after reading the franchise agreement, consult with your franchise attorney.

In some cases, the franchisor will actually help you sell your franchise unit, since they are always actively working with candidates that are already interested in the franchise system. In other cases, you are free to market your franchise for sale to whomever you want.

If you do not feel comfortable marketing the franchise for sale on your own, I suggest you seek the guidance of a business broker. Expect to pay a business broker about 10% of the sale price.

If you want to sell your franchise on your own, I suggest you visit BusinessMart.com. I am the president of BusinessMart, Inc. and we help business owners sell their business and franchisees sell a franchise.