Occasionally I have someone contact me who is interested in only an existing franchise business for sale. The person doesn’t want to launch a new business, grow it to the break-even point and build the book of business. Instead, he or she is willing to pay a premium for the cash flow of an existing franchise business.
In such cases, the buyer needs to be willing to pay a multiple for the cash flow after expenses or EBIDTA (earning before interest, depreciation, taxes, and amortization). Naturally, this is going to cost more than launching a new franchise brand in your local market.
For people who need to replace their income right away to become a business owner, a resale may be a good option. Finding the right franchise resale that matches with the buyer’s skills, interests and financial qualifications can be a challenge.
There are advantages and disadvantages to going with a resale versus a new franchise business. To learn more about franchise resales, check out this latest Franchise Alert.
If you are interested in a new or a resale franchise, you are welcome to book an appointment with me or visit our website.
