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The Pros & Cons of Buying an Existing Franchise

Owning a franchise is one of the easiest ways to get started on having your own business.  An alternative to buying a new franchise is to buy an existing franchise that is for sale.

There are advantages and disadvantages of buying existing franchises for sale.  Here are the pros and cons:


1.  Brand Reputation

An existing franchise will have local brand engagement and reputation, however it is important to find out if the franchise brand has a good reputation in your local area.

2.  Existing Customer Base

An existing franchise should already have customers, although you will need to build relationships with these customers while you are pitching your business to new customers.

3.  Trained Employees

An existing Franchise will have a staff that is trained.

4.  Financial Information Knowledge

You will have an idea about the annual revenue of the business, which will help you in determining if you should stay with the same marketing plan or if you should make some changes.

5.  Immediate Cash Flow

Cash flow should be immediate once you take over the business, which is not the case if you are starting a new franchise.


1.  Potential Customer Resistance

Some customers make not take kindly to a change in ownership, especially if it is a customer-facing business.

2.  Potential Employee Issues

Employees may have apprehensions about a change in ownership, especially if you make drastic changes that affect them.

3.  Potential Old Business Issues

If the franchise you are buying has old issues, you will have to make changes to make your business successful.

4.  Potential Franchisor Terms and Conditions Changes

The franchisor's terms and conditions may change when you buy an existing franchise and you may have to renegotiate the fees and terms again.


Click here to read the full FranchiseNow article about their insights into the pros and cons of buying an existing franchise.

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