Selling your franchise can be an exciting and rewarding milestone, but understanding the cost of selling a franchise business is essential for a smooth and successful exit.
Whether you’re preparing for a full exit from your business, or just starting to explore your options, it’s likely the first question you will ask is: “How much does it cost to sell my franchise?”
Which is exactly the right thing to do – because understanding the potential expenses involved in selling your franchise is crucial in order to make the resale process as smooth and stress-free as possible.
From broker fees and legal costs, to payments owed to your franchisor, having a clear picture early on will help you make informed choices, avoid nasty surprises, and maximise the value you walk away with.
This guide explains the various costs associated with selling your franchise and how to manage them effectively.
The short answer: franchise resale costs depend on your approach
The total cost of selling a franchise business varies significantly, depending on how you choose to go about it.
The only guaranteed cost you can expect is the fee payable to the franchisor. This amount will vary from franchise to franchise, but will always form part of the deal.
In our experience, there are two main approaches to selling a franchise:
- Selling the business yourself
- Engaging a professional franchise resale broker
Let’s explore each option in more detail.
Option 1: Selling your franchise by yourself
Taking on the franchise exit process yourself is most likely to be the cheapest route – at least on paper.
Yes, you won’t incur any broker fees, and you may be able to keep your legal expenses to a minimum.
However, there are some serious caveats to consider with this approach:
Legal risk
For many exiting franchisees, this will be the first time they have sold a business – and this is a niche process.
Attempting to handle complex legal contracts and compliance yourself throughout the process can lead to costly mistakes and delays.
Unless you are a qualified expert, if something is overlooked or incorrect, it is likely you will end up spending more time and money trying to fix the problems than if you’d used professional solicitors to begin with.
Time investment
There are many aspects to the end-to-end franchise resale process, all of which can be extremely time-consuming.
These include but are not limited to:
- Managing the marketing of the business
- Producing and updating the required marketing content
- Lead handling to your requirements and that of your franchisor
- Buyer screening
- Due diligence
- The sale negotiations
For an average business, it typically takes 100+ hours for buyer screening and guiding through the process.
Pertinently, the distraction of selling your franchise yourself can also negatively impact the performance (and therefore value) of your business.
Lost value
Without any expert guidance to lean on, it’s easy to either underprice your franchise and lose out on money you have worked so hard for, or price it too high and deter serious buyers.
Is it really worth it?
In summary, selling your franchise solo might reduce upfront costs, but it can dramatically increase stress and time to completion, and decrease the final sale price.
- To find out more in-depth information about this option, please read our dedicated advice guide: Can I sell my franchise business myself?
Option 2: Using a franchise resale broker
Many business owners looking to sell their franchise choose to work with a specialist franchise resale broker.
While this does involve professional fees, it typically leads to a smoother, faster sale – and, most importantly, a better sale price.
To help you gain a better understanding of the potential costs involved in this option, we’ve broken down the two key areas to be aware of:
1. Broker fees – paying for specialist expertise
Broker fee structures vary, so it’s important to understand what you’re committing to from the outset.
The two typical fees business brokers charge are:
Upfront fees
Some brokers charge a flat upfront fee to begin the process.
This could range from a few hundred to several thousand pounds, depending on the broker’s pricing structure and level of service you require.
Success/completion fee
Most business brokers will charge a fee once the sale is completed. This might be:
- A fixed amount agreed at the start
- A percentage of the final sale price
- A percentage of the initial asking price
It’s important to note some brokers may require a minimum success fee, regardless of the final sale price.
Top tip: All financials involved can vary from broker to broker – so always clarify the fee structure, inclusions, and any minimum costs with your resale broker at the outset. This enables you to be crystal clear on your obligations before signing an agreement.
At Franchise Business Brokers, we provide total transparency on all associated fees from day one.
2. Legal fees – a necessary (and worthwhile) expense
Selling any business, regardless of whether it’s a franchise, requires solid legal advice and expertise.
An essential legal aspect of the franchise resale process is the Tri-Party Agreement. This is the legal document drawn up by the franchisor to cover the transfer of the business from the seller to the buyer. Typically, the seller and buyer will need to pay for this on behalf of the franchisor, with costs split 50/50.
You will also need professional solicitors to assist with a range of aspects for the sale, including:
- Reviewing and drafting sale contracts
- Handling the franchise agreement transfer
- Liaising with the franchisor on any legal requirements
Legal fees for franchise resales are typically charged one of two ways:
- Hourly: You pay based on time spent, which can escalate quickly
- Flat fee: A single price quoted and agreed upon based on the scope of legal work required
With this in mind, we recommend having a conversation with several different potential legal partners to understand what fees may look like and best suit your position.
Top tip: For the process of selling a franchise business, we recommend you only use British Franchise Association (BFA) accredited law firms, who specialise in the legalities of franchising.
Generic business lawyers may lack the industry knowledge required to navigate franchise-specific clauses, which can slow the sale and end up costing you more money.
Always be aware of franchisor fees – regardless of which option you choose
Whatever option you proceed with, it’s critically important you are clear about any potential resale fees owed to your franchisor.
Your franchise agreement is likely to include clauses around selling the business, and it’s here that franchisor resale fees are often found.
These fees can include:
- Flat fee: A set amount payable upon completion of the sale
- Percentage fee: A percentage of either the final sale price or asking price
- Introductory fee: Owed to the franchisor if they introduce you to the eventual buyer
Sometimes these fees may only be applicable if the franchisor introduces the buyer to the selling franchisee.
On other occasions, franchisor fees could be compulsory, regardless of how the business is sold and irrespective of whether the franchisor makes the connection between buyer and seller.
Top tip: Before you get too far down the line in the resale process, it’s important to really drill into the details of your franchise agreement and understand all potential franchisor fees involved with selling your franchise.
It’s also a good idea to ask your franchisor to clarify and confirm any applicable charges in writing.
Watch out for hidden or overlooked costs
Beyond the primary costs of selling a franchise business which we’ve explored, there are also some additional – and often unexpected – costs that can arise during the franchise resale process.
These could include:
- Costs for professional photography or marketing upgrades
- Accountancy or tax advice to prepare financials for sale
- Early exit penalties in supplier or premises agreements
- Additional training costs requested by the franchisor for the incoming buyer
None of these costs are guaranteed, but they can quickly add up.
Reviewing your franchise agreement and current supplier contracts closely, or speaking with a specialist adviser, can help you uncover these in advance and avoid any nasty surprises.
Additional support your franchisor can offer
With all the above considered, many franchisors will be able to give you a steer throughout the franchise resale process, including:
- Recommending preferred accredited brokers, solicitors, and other legal partners
- Supporting buyer recruitment or making introductions to potential new franchisees
- Assisting with resale documentation and onboarding for the buyer
If your franchisor does not provide this level of support, we recommend speaking to the BFA and looking at their helpful advisor directory.
You can then reach out and have conversations with these accredited professionals about your own franchise resale process.
Top tip: Make the most of the support your franchisor offers where available – but always do your own due diligence alongside, particularly around fee structures and exclusivity terms.
- To find out more in-depth information, please read our dedicated advice guide: The importance of keeping your franchisor involved in the franchise resale process
Top tips for managing costs involved with selling your franchise
To ensure you’re financially prepared for your franchise resale, we recommend following these best practices:
Have important conversations as early as possible
Talk to potential brokers, solicitors, and your franchisor before making any decisions, so you have a thorough understanding of all the potential costs involved.
Set a resale process budget
Create a clear financial plan for the sale, which includes a budget covering broker fees, legal fees, franchisor charges, and any marketing or preparation costs.
Factor these costs into your asking price
Take your resale process budget into consideration when it comes to setting your asking price for the franchise. This will help you build a buffer into your asking price to cover expected costs, which is important to maximise your return after expenses.
Focus on ROI
Don’t fixate on going down the cheapest possible route at every turn; the right broker or solicitor may cost more, but will likely help you achieve a significantly higher sale price.
- To find out more in-depth information, please read our dedicated advice guide: 10 top tips for the franchise resale process
Example cost to sell a franchise
As we said at the outset, there is no single figure that answers this question.
However, as an approximate guide to give you an idea, here is a typical breakdown range for a £150,000 franchise sale:
| Cost Area | Typical Range |
|---|---|
| Broker fees | £3,000–£15,000+ (flat or % fee) |
| Legal fees for the seller | £1,500–£4,000 |
| Tri-Party Agreement payment | £1,000–£2,000 |
| Franchisor resale fee | £1,000–£10,000+ (flat or % fee) |
| Miscellaneous/admin | £500–£1,000 |
Please do keep in mind these figures are very indicative and can vary significantly depending on a wide range of factors, including your sector, brand, and resale complexity.
How to maximise value and minimise stress when selling your franchise
Selling your franchise doesn’t have to be an overwhelming or wildly expensive endeavour – especially with the right expert support in your corner.
At Franchise Business Brokers, we provide a full-service franchise resale solution, guiding you from valuation to completion with transparency, precision, and genuine care.
Our experience means we know how to maximise your final sale price, while simultaneously helping you minimise avoidable costs.
Whether you’re just starting to explore your options or are ready to take the next step, we’re here to help.
Contact us today for a friendly, no-obligation chat to learn more:
T: 020 8017 2115
E: info@chantry.email
Why you can trust Franchise Business Brokers
We are the biggest and best team of dedicated franchise marketing and brokerage experts in the UK.
We can help you with as little or as much as you need, from initial franchise valuations and strategies to maximise your business’ value, through to the entire end-to-end franchise resale process.
We also offer a diverse range of businesses for sale in our Franchises For Sale directory.
We look forward to helping you on your exciting franchise resale journey. In the meantime, please explore our website and franchise advice hub to find out more.
