Browse Restaurants for sale

Franchise Resales

Franchise Resales

What are franchise resales?  These are open and operating highly desirable brand name restaurants that were developed and launched by the first owner.  They took the initial risk to identify the need in the marketplace for this national brand.  They located a new site and in most instances, committed large amounts of capital to build the new location.  When that operator decides to sell, these opportunities are called franchise resales.

All major brands in America have franchise resales available.  The International Franchise Association estimates that as many as 5% to 10% of any brand's inventory will be on the market at any given time.  These franchise resales create amazing opportunities for restaurant buyers.  The original owners spend anywhere from $250,000 on the low end to up to $650,000 on the high end to build a new franchise location.  When they sell it, they can no longer command the price for their original investment as franchise resales trade in one of two ways. 

First, franchise resales are priced on a multiple of earnings.  A restaurant broker analyzes the profit and loss of the business to recast it into Seller's Discretionary Earnings (SDE) or Owner Benefit.  This is the amount a new owner or operator would net from running the business himself.  Why do we use this model?  It is the same model used by the SBA or Small Business Association to establish valuations for lending and thus, creates the ability for us to compare businesses on the same basis across multiple opportunities. 

Secondly, franchise resales are priced based on the value of their assets.  This is used when the business is not cash flow positive and is typically referred to as an "asset sale."  The value will be discounted from their original investment since the assets are no longer new.  Owners of franchise resales looking to get what they invested in their business will be disappointed by the actual value of the business valued in this manner.  They may have invested $350,000 to build out a brand name sandwich shop restaurant but it will only sell for around $99,000 at the discounted value.  These are huge opportunities for buyers seeking low cost franchise resales. 

What causes someone to resell their restaurant, creating these franchise resales?  There are a number of reasons but here are the top five reasons the restaurant at We Sell Restaurants see franchise resales come into the marketplace.

Owners that prefer to Build versus Operate 
The skill set that many owners bring to the table when building a new location are very different from those of an onsite owner and operator.  The building of a new location focuses on project management.  Just like building a house, building a new franchise location is a multi-month (sometimes multi-year) undertaking.  They are meeting with leasing representatives, finding the right location, establishing their business entity, arranging their financing and doing all types of tasks that have a finite beginning and end.  They often find themselves very enamored with the process of building but once the doors are open, they must shift to daily management and people oversight versus project management.  For many, it is not as interesting to operate the business. These locations become franchise resales. 

Partnership Disputes
The failure of partners to get along is the second reason the restaurants brokers see franchise resales hit the marketplace.  Partners who go into business together because they love a concept start with good intentions that don't always play out.  Just like marriages (where one in two end in divorce), partnerships are not easy.  One partner will inevitably get a new job opportunity.  There may be an inequity in workload where one side or the other is doing the heavy lifting, creating an imbalance.  Eventually, with the stress of operations, partnerships sour. That's the second main reason franchise resales.

Retirement 
According to this article in Forbes Magazine, "In 2011, baby boomers started turning 65, and from now until 2030, that number will swell by 10,000 each day. That’s 70,000 per week and over 280,000 per month."  Baby boomers have some of the vastest financial holdings of any generation, including businesses.  These retirees are selling these money making and valuable assets, creating more franchise resales. That is the third reason franchise resales are being created, creating opportunity for restaurant buyers. 

Great Grandchildren Trading Concepts
The business model for franchising began in the 1950's, just as the interstate highway system was being developed.  Americans wanted commonality and consistency when they traveled the U.S., so the idea of the same brand at every highway exit, led to a boom in the franchise model.  Early adopters of franchising may have begun with one unit, but the value and earnings may have led them to launch and operate several more. Their children (baby boomers), inherited these strong concepts and in many cases, added on more units of these legacy brands.

The children of baby boomers are Millennials, also known as the "me" generation.  Now that their parents are retiring, they are often either not interested in the restaurant business or in some cases, want to trade legacy brands, for newer, "cooler" concepts. These may be concepts they view as more "green" or more "socially conscious" or they may simply be newer concepts (think frozen yogurt versus hamburgers) but in any event, this group is putting their franchise resales on the market as they pursue other interests. 

Lifecycle of the Agreement 
The actual ownership cycle may dictate that more franchise resales come onto the market.  A typical franchise agreement is ten years in length and then subject to renewal.  When a brand is dubbed, "Hot Concept" and people rush in over a short period of years, creating a bubble of owners over a two to three year period.  When their typical 10-year agreement is ready to renew, they may be ready to try something else or not be willing to do the remodel or refresh required at that point.  For many, they simply see ten years as enough, especially if they have operated profitably.  It is a natural window to reassess in the year or so before renewal and move on to a new opportunity or retire. 

Finding franchise resales that are on the market is often not as easy as approaching the brand themselves.  Many do not work with their franchise owners on franchise resales as their development team is focused on new stores, not existing ones.  The best source of franchise resales is a brand like We Sell Restaurants which has relationships with national brands and represents most of the units nationwide.  Our inventory of franchise resales is found on this page or online at WeSellRestaurants.com 

Franchise resales are a great opportunity to acquire a business with strong brand recognition, established earnings and a well known location in the market. For many, it is the fastest and easiest path to restaurant ownership.

Franchise Resales

National franchise for sale in Round Rock, Texas.

National franchise for sale in Round Rock, Texas.

Listing Id:8705 Lease Term:expires Decembe.. Monthly Rent$8115, Sq.ft.2400,
Firehouse Subs Franchise for Sale with Six Figure Earnings!

Firehouse Subs Franchise for Sale with Six Figure Earnings!

Listing Id:8687 Lease Term:Valid through S.. Monthly Rent$5365, Sq.ft.3000,
Multi Unit Marco's Pizza Franchises for Sale with $1.2 Million in Revenue!

Multi Unit Marco's Pizza Franchises for Sale with $1.2 Million in Revenue!

Listing Id:8679 Lease Term:2, 5 Monthly Rent$3800 | 3900 Sq.ft.1600 | approx 1..
Marco's Pizza Franchise for Sale with over $700,000 in Revenue!

Marco's Pizza Franchise for Sale with over $700,000 in Revenue!

Listing Id:8677 Lease Term:Valid through 2.. Monthly Rent$3900, Sq.ft.1850 ,
Marco's Pizza Franchise for Sale with over Half a Million in Revenue!

Marco's Pizza Franchise for Sale with over Half a Million in Revenue!

Listing Id:8676 Lease Term:Valid through 2.. Monthly Rent$3800, Sq.ft.1600,
3- Store Franchises For Sale Package makes over $200,000 SDE

3- Store Franchises For Sale Package makes over $200,000 SDE

Listing Id:8673 Lease Term:Multiple Leases.. Monthly Rent$7473.00,7373.52.. Sq.ft.2400,2400,1800,
Juice Bar Franchise for Sale - Six Figure Owner Benefit

Juice Bar Franchise for Sale - Six Figure Owner Benefit

Listing Id:8662 Lease Term:10yr lease expi.. Monthly Rent$7826.30, Sq.ft.1300,
Two Juice Franchises For Sale With Six Figure Owner Benefit

Two Juice Franchises For Sale With Six Figure Owner Benefit

Listing Id:8661 Lease Term:5yr and 10yr Monthly Rent$4509,7826, Sq.ft.1005,1300,
Clean Juice Franchise for Sale - Six Figure Owner Benefit

Clean Juice Franchise for Sale - Six Figure Owner Benefit

Listing Id:8660 Lease Term:10 year lease Monthly Rent$3084.28, Sq.ft.907,
Franchise Restaurant for sale is the next big thing!

Franchise Restaurant for sale is the next big thing!

Listing Id:8659 Lease Term:Exp. Aug 2025 Monthly Rent$10831, Sq.ft.6000,
South Denver Subway Franchise for Sale.  Nets Owner Six Figures

South Denver Subway Franchise for Sale. Nets Owner Six Figures

Listing Id:8656 Lease Term:Expires 2029 Monthly Rent$3300, Sq.ft.1150,
Firehouse Subs Franchise for Sale - Great location, Price to Sell!

Firehouse Subs Franchise for Sale - Great location, Price to Sell!

Listing Id:8649 Lease Term:expires 4/1/202.. Monthly Rent$5426, Sq.ft.1856,
Multi Unit Firehouse Subs Franchises for Sale Earnings of over $275,000!

Multi Unit Firehouse Subs Franchises for Sale Earnings of over $275,000!

Listing Id:8642 Lease Term:All leases Vali.. Monthly Rent$7198.88 ,3047,2.. Sq.ft.2714,1842,1600,..
Multi Unit Firehouse Subs Franchises for Sale with Earnings over $280k!

Multi Unit Firehouse Subs Franchises for Sale with Earnings over $280k!

Listing Id:8641 Lease Term:Valid through 9.. Monthly Rent$7198.88 ,3047,2.. Sq.ft.2714 ,1842,1600..
Firehouse Subs Franchise for Sale with Verifiable Earnings- Won't Last

Firehouse Subs Franchise for Sale with Verifiable Earnings- Won't Last

Listing Id:8640 Lease Term:Valid through A.. Monthly Rent$3800.02, Sq.ft.2000,
Firehouse Subs Franchise for Sale with Sales of almost Half a Million!

Firehouse Subs Franchise for Sale with Sales of almost Half a Million!

Listing Id:8639 Lease Term:Valid until May.. Monthly Rent$3873.71, Sq.ft.1465,
Pizza Franchise for Sale in South Metro Denver Nets Owner Over $176,000!

Pizza Franchise for Sale in South Metro Denver Nets Owner Over $176,000!

Listing Id:8634 Lease Term:Expires 2025 wi.. Monthly Rent$6200-, Sq.ft.2350-,
Profitable Quick-Serve Franchise in Rochester New York - $60K Earnings

Profitable Quick-Serve Franchise in Rochester New York - $60K Earnings

Listing Id:8629 Lease Term:Remainder of 10.. Monthly Rent$3450.91, Sq.ft.1900,
Profitable sandwich franchise for sale in Austin Metro

Profitable sandwich franchise for sale in Austin Metro

Listing Id:8628 Lease Term:expires April 2.. Monthly Rent$6200, Sq.ft.1800,
Firehouse Subs Franchise for Sale with over $250,000 in Earnings

Firehouse Subs Franchise for Sale with over $250,000 in Earnings

Listing Id:8625 Lease Term:Valid until Oct.. Monthly Rent$6811.39, Sq.ft.2741,
Multi-Unit Jimmy John's Franchises for Sale, Tremendous Owner Benefit!

Multi-Unit Jimmy John's Franchises for Sale, Tremendous Owner Benefit!

Listing Id:8614 Lease Term:10 Monthly Rent$3669.17,2525,55.. Sq.ft.1190,1500,1638,
Six Unit Jimmy John's Franchises for Sale In Charlotte Area!

Six Unit Jimmy John's Franchises for Sale In Charlotte Area!

Listing Id:8613 Lease Term:10 Monthly Rent$8431,3944.99,50.. Sq.ft.1300,1315,1600,..
$203,000 in Earnings on Multi-Unit Sandwich Franchise for Sale in Tucson

$203,000 in Earnings on Multi-Unit Sandwich Franchise for Sale in Tucson

Listing Id:8600 Lease Term:Expires 2022 & .. Monthly Rent$7121,7139.67, Sq.ft.2200,2300,
Six-Figure in Owner Earnings of this Tucson Sandwich Franchise for Sale

Six-Figure in Owner Earnings of this Tucson Sandwich Franchise for Sale

Listing Id:8597 Lease Term:Expires 2022 wi.. Monthly Rent$7121, Sq.ft.2200,
$123,000 in Earnings at Profitable Sandwich Franchise for Sale in Tucson

$123,000 in Earnings at Profitable Sandwich Franchise for Sale in Tucson

Listing Id:8596 Lease Term:Expires August .. Monthly Rent$7139.67-, Sq.ft.2300 -,
Franchise for Sale in Madison Alabama - Four for the Price of One!

Franchise for Sale in Madison Alabama - Four for the Price of One!

Listing Id:8586 Lease Term:Up for renewal .. Monthly Rent$4460.36, Sq.ft.1400,
Multi-Unit Jimmy John's Franchise Opportunity, Massive Owner Benefit !

Multi-Unit Jimmy John's Franchise Opportunity, Massive Owner Benefit !

Listing Id:8575 Lease Term:15 Monthly Rent$8431,3944.99,50.. Sq.ft.1300,1315,1600,
Sub Franchise for Sale with over Half a Million in Revenue!

Sub Franchise for Sale with over Half a Million in Revenue!

Listing Id:8569 Lease Term:Up for renewal .. Monthly Rent$5143.73, Sq.ft.1900,
Subway for Sale in Delray Beach, FL - Great Location and Lease

Subway for Sale in Delray Beach, FL - Great Location and Lease

Listing Id:8566 Lease Term:Expires Februar.. Monthly Rent$3111.09, Sq.ft.1100,
BBQ Franchise For Sale Producing Six Figure Income For Owner

BBQ Franchise For Sale Producing Six Figure Income For Owner

Listing Id:8561 Lease Term:Expires in 2024 Monthly Rent$5100, Sq.ft.2175,
Package of Two Sandwich Franchises for Sale in the Phoenix Market

Package of Two Sandwich Franchises for Sale in the Phoenix Market

Listing Id:8553 Lease Term:August 2023 and.. Monthly Rent$6757,4450, Sq.ft.1785,1525,
Almost $70,000 Owner Earnings on this Arizona Sandwich Franchise for Sale

Almost $70,000 Owner Earnings on this Arizona Sandwich Franchise for Sale

Listing Id:8552 Lease Term:Expires Septemb.. Monthly Rent$4450.00, Sq.ft.1525,
Profitable Sandwich Franchise for Sale in Chandler Arizona

Profitable Sandwich Franchise for Sale in Chandler Arizona

Listing Id:8551 Lease Term:Expires August .. Monthly Rent$6757, Sq.ft.1785,
Two Sub Franchises for Sale with Big Owner Earnings

Two Sub Franchises for Sale with Big Owner Earnings

Listing Id:8544 Lease Term:6 years remaini.. Monthly Rent$3750.00,13963.7.. Sq.ft.695,944,
Sub Franchise for Sale in Huge Shopping Center Ready for New Owner!

Sub Franchise for Sale in Huge Shopping Center Ready for New Owner!

Listing Id:8543 Lease Term:6 years remaini.. Monthly Rent$3750.00, Sq.ft.695,
Sub Franchise for Sale Brings in $74,000 for Owner Operator!

Sub Franchise for Sale Brings in $74,000 for Owner Operator!

Listing Id:8542 Lease Term:10 year lease Monthly Rent$13963.71, Sq.ft.944,
Sandwich Franchise for Sale - Great location, Price to Sell!

Sandwich Franchise for Sale - Great location, Price to Sell!

Listing Id:8538 Lease Term:3 year lease re.. Monthly Rent$5625, Sq.ft.2000,
Subway Franchise for Sale in Shelby Township, Michigan

Subway Franchise for Sale in Shelby Township, Michigan

Listing Id:8536 Lease Term:Up for renewal .. Monthly Rent$2186.38, Sq.ft.1150,
Highly Profitable Pizza Franchise Resale in North Ridgeville Ohio

Highly Profitable Pizza Franchise Resale in North Ridgeville Ohio

Listing Id:8533 Lease Term:Up for renewal .. Monthly Rent$2480, Sq.ft.2080,
Showing 1 - 50 Records Of 167