Frequently Asked Questions

Industry Facts:

How will you find a buyer for my franchise business?

There are many resources we draw on to find you a qualified buyer. We will advertise your business on the top internet sites that have a proven track record of success. Through our web site, we maintain an ongoing data base of pre-qualified, interested buyers who will have the first opportunity to consider your business. In addition, our sister company, Diamond Financial Services, regularly brings us qualified buyers with pre-approved financing who are looking for the right business opportunity.

How do you pre-qualify a buyer?

Securing financing for prospective franchise buyers is the specialty of our sister company, Diamond Financial Services. We require all prospective buyers to fill out our pre-qualification application and provide thorough financial data. We analyze this data to determine whether a buyer is qualified obtain the necessary financing to purchase your business. Only pre-qualified buyers will have the opportunity to review the financial information about your business.

Why should I buy an existing franchise when I can start my own store from scratch with the franchise company?

When you buy an existing franchise, you get all of the advantages of owning a franchise business, plus the big unique advantage of being in business immediately. If you buy through the franchise company, you’ll spend between 9 months and 2 years getting ready to open your business.

You sound like a broker. How does your service differ?

In many ways, our service is similar to the service of the business broker. That is, we bring qualified buyers together with business sellers. However, we are strictly dedicated to franchise businesses which are typically smaller businesses that brokers are not interested in. We also charge much less, just 4% of the selling price compared to broker’s fees which range from 10 – 15%. We utilize the internet (and our national database from our sister company Diamond Financial Services) to attract qualified buyers and interested sellers, and then we bring them together. We also can help valuate a business and secure financing for the buyer.

If I list my business for sale with FBD, how long am I committed for?

We require just a six month agreement for the Gold level of service. If we cannot bring a qualified buyer to you in this timeframe you may try to sell your business elsewhere and owe us nothing more. Our Silver and Bronze advertising levels allow us to advertise your business without any other commitments from you. You can use our program to coincide with other commitments or obligations you may already have in place. We will simply promote and advertise your business.

Do you provide buyer financing?

We can help pre-qualify buyers and help them secure financing for the purchase. For years, our other business has been providing small businesses and franchises with financing. For more information, visit the Franchise Funding page of this site.

How will I know I am getting the right price for my business?

We are experts in reviewing business financials and have been setting the value of businesses for years. We also have established relationships with top business evaluation services if needed.

I’m thinking about selling, but don’t want my staff and competitors to know. Can I avoid letting them know?

Our service employs the very highest standards of privacy and security. We deal only with the seller and disclose only the information our sellers wish to disclose. You can be confident that no information will be released without your prior approval. We also require all serious prospects to sign a confidentiality agreement.

Don’t people only sell when their business is failing?

This is a common misconception. There are many reasons people may sell a business. A big one is retirement. Sometimes a business owner may want to sell his business to invest in another business. Other reasons include health, divorce, relocation, desire to do something else or just plain burnout. Most businesses that have survived for years could not have been losing money consistently. Regardless, an existing business will have several years of financials to review and evaluate.

How much money will I need up front as a down payment?

Generally, a 15-20% down payment is required and adequate working capital is included in your loan amount. However, the amount of money you will need for a down payment may vary greatly depending on the type of business you wish to buy, assets included with the business and many other variables. A rule of thumb is the more you have to put down the less you will pay in total for the business. FBD can help you in financing decision-making process.

What are some considerations when buying a business?

First, is it a business you like? One that you will be comfortable working in? Other things to pay attention to include where the business is located and the owners true discretionary income. You should also consider how you will improve the business and make it even more successful.

Is the information I am sending you safe and secure?

We sign a confidentiality agreement with you before you disclose any sensitive information. Other than qualified buyers, who also must sign a confidentiality agreement, we are the only ones who will see the information you provide.

Do I need to get franchisor corporate approval?

Yes. Once Letter of Intent or Purchase is signed, approval from franchise home office is sought. Approval process varies by franchisor.

When do I pay for your service?

For our Gold program, you initially pay just $150 to cover processing and administrative costs. When the sale of your business has closed, you pay 4% of the sale price. For our Silver or Bronze programs, our fee is due do once you sign and return the advertising agreement. For buyers, our service is free.

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