Olympia Fields, IL- Whether a business owner wants to sell the company, take it public, pass it on to their children or just hold on and retire, franchising provides the aggressive growth, accountability structure and predictable revenue to appeal to several types of exit strategies.
Franchising leverages a business owners system of operations to provide an opportunity for people to get in business for themselves utilizing a proven business model. Franchisees act as independent business owners and are not working for a manager, director, or boss, they work for themselves.
Franchising creates a secure revenue stream with franchisees that are dedicated to their own growth. Royalties, which are paid off of gross sales, increase as franchisees become more successful with their business. Franchisees are putting up the money and the time to build their franchise and are rewarded off the bottom line. The motivational issues and managerial oversight
that are required in corporate expansion are not as prevalent in franchise growth. This cycle of growth creates a terrific source of predictable revenue which creates a safer transition of ownership and strong interest from private equity firms and investors. It is for this reason that franchise companies are typically valued at 7-10 times EBITDA, several times higher than the average 5 times valuation for business.
When the owner of the company sells or retires, franchisees are still responsible for their own stores and generating profits for themselves, a trait which transcends all exit strategies.
Is NOW the time to franchise?
The issue of exit strategies is one of the many topics of Francorps online Franchise A Business seminar. To learn more about franchising, or how to franchise a business, visit http://www.francorp.com or call 800-372-6244.Also, visit http://www.francorp.com to download the free e-book and take the franchise quiz today!