f o o d fr a n c h i s i n g fe at u r e
EXPERT ADVICE: Sam Willis | Business and Finance Writer
How To Determine The Current Value
Of An Existing Franchise Owning a franchise is often an attractive option for entrepreneurs. Factors such as brand awareness, corporate training, and franchise purchasing power are a few of the benefits that seemingly give franchisees a leg up over individual business owners.
With that said, not every franchise location is a clone of its peers, with myriad factors capable of influencing the value of a
specific location. Therefore, whether you
are an owner looking for advice on how to
sell a franchise or an entrepreneur looking to explore the benefits of becoming a
franchisee, the following 5 methods can
provide helpful insights into the valuation of an existing franchise.
with the Balance 1Start Sheet
When looking into how to value a business, any preliminary efforts will likely start with the balance sheet. The balance sheet is a breakdown of the business’ assets and liabilities. Often referred to as the “book value” of the business, the assets of a business will include items such as real estate, buildings, vehicles, equipment, and anything else that
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If there is a pattern of increasing revenue each year, the buyer can feel confident that more customers are turning to the business, with profit margins to be optimized with improved management.
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34 Franchising MAGAZINE USA
