You've probably heard more than once that franchise...
While many franchisees plan for economic downturns, none of them could have foreseen a new pandemic. Despite the interruptions to businesses everywhere and life in general, this unprecedented event can provide an opportunity for prospective franchisees who are looking to buy a franchise in Canada today or in the near future.
Owners with already-established franchise business locations are now looking to sell them for a variety of reasons, and this might be something you're interested in. With a franchise resale, you're getting a location that is already up and running, with the groundwork done.
Right now, the franchise resale market is skewing in the favour of the buyer. If you are ready, you'll find many franchise resale opportunities. Use these three tips to help seal your franchise resale deal in your favour.
Know the franchisor
On top of the typical due diligence, take the time to explore how the franchisor handled this pandemic and where they are now. Is the franchisor still strong financially? Did they provide assistance to the franchisees who needed it in their system? Did they help franchisees find ways to connect with the community?
Unfortunately, this pandemic is not over yet, and there could be a similar event in the future. You want a franchisor who will be there to support you in the event of a crisis. Speak to other franchisees in the system about how the franchisor responded to the pandemic. From current franchisees, you'll be able to gain the most valuable insight.
Be creative with financing
A strong cash reserve helps, of course, but you might still need financing for your resale. Consider a seller-financing option if it's available; this ensures the seller is motivated to help with the ownership transition. When you keep the prior owners on the payroll, so to speak, for a period of time after you take over, you'll have access to their wisdom and experience. They'll also be more invested in your success.
Get ready to move
Plan now for how you can expand the business and boost sales. If you can diversify services and products, work out a way to do so. Diversification will help protect you against market calamities in the future. Although the business is already up and running, you'll want to come in ready to take it to the next level.
A franchise resale deal might be the avenue into franchise ownership you've been looking for. Take the time necessary to explore and research your options before making your decision.