Should I use a broker to sell my franchise?

If you are considering selling your franchise business, it is vital you are fully aware of what lies on the journey ahead.

However, you must be aware that selling a franchise isn’t like selling a second-hand car.

It’s a significant decision involving legal complexities, specialist marketing know-how, buyer scrutiny, and franchisor approval to name just a few key aspects.

That’s why one of the most important early questions any franchise owner should ask themselves is: “Should I use a broker to sell my franchise?”

This guide helps you unpack that question, so you can confidently decide what the right franchise resale journey is for you.

Whether you’ve sold a business before, or if this is your first time exiting a franchise, we explore the practicalities, pros and cons, and key things you need to consider before deciding whether to go it alone or bring in expert support.

It starts with you – and your experience

When it comes to deciding whether to use a broker to sell your franchise business, the first place to start is by analysing your own position.

Before looking at external options such as a business broker, take stock of your own experience.

Ask yourself the following questions:

• What’s your professional background?
• Have you bought and sold a business before?
• Have you bought and sold a franchise before?
• If so, how recently?
• Do you know what’s involved in the valuation, marketing, legalities, negotiation, financing, and onboarding of a franchise resale?

It is the answers to these questions that hold the key to deciding how to proceed with selling your franchise.

If you’re confident in all of the above and have recent experience, then great – managing your own franchise resale process without the services of a professional broker might be an option worth exploring.

• Should this be the case for you, we recommend reading our dedicated article: Can I sell my franchise business myself?

However, if you do not have experience in buying and selling businesses – especially within franchising – it really does pay to reap the benefits of a specialist broker who has been there, done that, and got many T-shirts to show for it!

Why? Because they understand the road you’re about to travel, and they are going to help you avoid any potholes along the way – the costly mistakes that can take large amounts of time, money, and effort to rectify.

To help you make an informed choice when deciding whether to use a broker to sell your franchise, we’ve detailed some key topics you should be aware of before you get going.

Did you know you can’t sell a franchise to anyone?

Franchising is unique; unlike owning an independent business or SME – where you do not need anyone’s approval – you cannot sell your franchise to just anyone who turns up with the right amount of money.

When selling your franchise business, your franchisor has an important part to play in vetting and approving any prospective buyer. This is to ensure they meet the specific financial, operational, and character criteria needed to join their franchise network.

A specialist franchise broker will understand this process inside-out. They will know how and when to involve the franchisor to maintain goodwill, avoid delays, and secure a smooth approval process.

• To find out more in-depth information about this topic, read our dedicated advice guide: The importance of keeping your franchisor involved in the franchise resale process

Do you know what documentation is required for a franchise resale?

Are you familiar with what documents a prospective buyer will want and need to review as part of their due diligence?

Have you got a secure virtual data room that a prospective buyer can access when needed?

Have you got a non-disclosure agreement (NDA) prepared for them to sign before granting access to sensitive financial information and business specifics you wouldn’t necessarily want to make available early in the process of attracting potential buyers?

From franchise agreements and financials, to client contracts and employee details, buyers need access to a wealth of information throughout the process – but only at the right time.

To ensure smooth progress with a potential buyer, we strongly recommend you have the following in place:

• A secure virtual data room
• A clear non-disclosure agreement (NDA) tailored to your business’ sale
• Properly structured and accessible documentation to present your business in its best light

Essentially, you must have a crystal clear understanding of what you need to enact a smooth and successful franchise resale at every stage of the journey.

If this is an area in which you are lacking, a broker can confidently guide you through exactly what will be needed, help set up your virtual data room, manage confidentiality issues, and prevent unnecessary delays.

• For more information about the importance of a virtual data room, read our dedicated article: Why a virtual data room could make or break your franchise resale

How much time can you really spare?

Selling a franchise takes time – and plenty of it.

On top of running your business so effectively it maintains the strength of performance and growth potential that makes it attractive to a prospective buyer, those managing their own franchise resale will be expected to dedicate time to:

• Creating content and marketing materials advertising the business
• Fielding buyer enquiries
• Lead qualification
• Lead handling
• Professional follow-ups – including online and in-person meetings, emails, SMS, and out-of-hours calls
• Handle negotiations, financing, and deal structuring

So ask yourself this: do you have the time, availability, will, and skill set to do all of that alongside your current day-to-day schedule?

For most owners, this level of involvement in selling their franchise can distract from successfully running the business.

This will potentially hurt performance and, in turn, reduce the sale value of the business.

The above are all critically important aspects of a franchise resale, and something an experienced broker can either guide you on, or manage on your behalf.

This will enable you to focus on maintaining a strong operation, safe in the knowledge your franchise resale process is in capable hands and progressing smoothly.

Have you got the skill set to effectively market your business?

Another fundamental question to ask yourself is whether you have the extensive skill set and ability required to effectively market your business.

Selling a franchise isn’t as simple as putting an advert online and waiting for the phone to ring.

Among many other things, you will need to:

• Craft compelling content and buyer listings
• Highlight key strengths and opportunities that will appeal to buyers
• Know which channels and platforms to use effectively
• Understand buyer psychology and motivation

Let’s compare the franchise resale process to how you actually run your business on a day-to-day basis.

It’s likely you are really strong in a few areas of daily operations, such as financials and job scheduling, but rely on other members of your team and/or your franchisor to cover weaknesses you have in a business context in order to run the franchise successfully.

The same principles can be applied when it comes to selling your franchise.

For example, if marketing a business for sale isn’t your strong suit (and understandably so), then it really will pay to get the support of an experienced broker who knows exactly how to effectively show off the opportunity to prospective purchasers.

Professional brokers understand how to position businesses effectively, run multi-channel campaigns, and bring the right buyers to the table – avoiding time-wasters and tyre-kickers.

Do you know where to go to find buyers?

Even if you are confident in presenting your franchise for sale, do you know where to find serious prospective buyers?

Ask yourself the following questions:

• Do you have an understanding of the different channels available when selling your franchise?
• Do you know where best to advertise for the sector you operate in?
• Do you know which franchise portals you should list your business on to secure the best return on investment?
• Do you know how to tap into networks of pre-qualified buyers?
• Do you have access to databases of active investors?

If you mostly answered “No”, then again it can be incredibly beneficial to use a specialist franchise broker.

Any good franchise broker maintains established channels and networks that you may not have access to.

Additionally, they will know how to leverage each platform effectively to ensure strong, qualified interest in the business.

For individuals looking to sell their franchise, this means faster exposure, better qualified leads, stronger offers, and ultimately the best return on investment.

So, should you use a broker to sell your franchise?

We hope you now have a better understanding of the key aspects you must be aware of when deciding whether to use a broker to sell your franchise.

Ultimately, the decision comes down to your experience, availability, and confidence in managing a complex sales process.

So, as we said at the beginning, it all starts with establishing your own position.

If you have sold a franchise before

If you have sold a franchise before, and are well-versed in the legalities and necessary marketing strategy involved, going solo could be feasible.

But before pushing ahead with this choice, consider whether you have the time, energy, effort, and will to go through the franchise resale process all by yourself once more.

If you do not, it’s worthwhile having a conversation with a specialist broker to understand what they can do to help and support you along the way.

Perhaps they can fill certain gaps in your knowledge or skill set, helping to secure your franchise’s sale for the highest possible price – without you having to burn yourself out.

If you have not sold a franchise before

If you have no previous experience in selling a franchise or business, then using a broker to sell your franchise is a smart choice to make for many reasons.

A good franchise broker will not only take lots of unappealing but essential work off your hands, they will also:

• Ensure your sale is managed professionally, strategically, and confidentially from the outset
• Establish a true and fair valuation of your franchise, ultimately maximising its sale price
• Generate qualified leads and handle them throughout the sale process
• Protect your interests from start to finish

How to get started with selling your franchise

If you’re still unsure whether to handle your franchise resale yourself, or want to further explore the benefits of bringing in a professional team, Franchise Business Brokers is here to help you.

Whether you need help with parts of the process, or want full end-to-end support, we’ll guide you through your franchise resale journey with honesty, experience, and care.

Contact us today for a friendly, no-obligation chat to learn more:

T: 020 8017 2115
E: info@chantry.email