[Free Book Preview #19] Turnkey Acquisition

[Free Book Preview #19] Turnkey Acquisition

Hey there, Freedom Seeker!

Welcome to the exhilarating big sky of small business entrepreneurship!

I wrote a book for you. This book reveals the Unbiased Small Business Research Formula developed from decades in the trenches of American Main Street and online business as a small business entrepreneur and a coach. Its objective is to help you become the successful creator of the new life you envision by objectively guiding you in researching and choosing the right business.

In the next weeks, I’ll share free sections of the book with you before it’s released for publication and available for purchase.

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The fourth and last path to business ownership is to buy a for-sale franchise that is already developed or a business opportunity. It is the hybrid option of acquiring an existing business and investing in a turnkey concept. 

Here, the seller has bought into a franchise network (or a business opportunity) and has grown and developed that business unit or location to some extent. They may want to move on to create another business or retire. Here, you’ll have the combined advantage and challenges of both acquiring a for-sale business and developing a new franchise. 

Who is this for:

This option might be for you if you want to shortcut the ramp-up of launching a franchise while acquiring a cash-flow-positive business with an infrastructure for research and development (from the franchisor.) Perhaps you only want to spend a few years running a business, or you seek the opportunity to turn a struggling franchise around. It could be that you initially considered launching a new franchise unit but found an opportunity to acquire one that you feel comfortable turning around. 

Advantages:

You might take a lesser risk if the business has a positive cash flow. If not, it could be an opportunity to acquire a franchise for a lesser investment than a new franchise. As always, be sure to evaluate why a for-sale franchise might be cheaper than a brand-new undeveloped unit. With a resale, you’ll have access to the historical financial data of the business. In addition, through tactful discussions, you might also gather intel about the current franchisee’s experience with the franchisor and have the opportunity to address potential red flags.

Challenges: 

Similarly to acquiring an independent business, consider the legacy issues you might encounter, i.e., staff challenges, customer dissatisfaction, obsolete equipment to replace, pending legal conflict, etc.

If you are acquiring any turnkey concept that is struggling, evaluate why it is unsuccessful and how often this location has changed owners. Each time a franchise is “re-sold,” the franchisor collects a franchise fee for the transfer of ownership. A franchise’s source of revenues from franchise fees that is out of proportion with the royalties collected reveals an alarmingly high turnover of franchisees. Be sure to review the historical data and the Franchise Disclosure Documents thoroughly. 

You’ll find each of these four paths to small business ownership in any industry sector. They could be brick-and-mortar businesses. They could be online businesses: e-commerce or digital businesses. They could be mobile businesses or manufacturing companies. They could be service-oriented or retail-oriented businesses or both. They could also be full-time, semi-absentee, or absentee ownership. Again, none of these paths to business ownership are better, easier, or less risky. Your success depends on choosing the right business based on your goals, priorities, assets, and personality. 

Congratulations on completing the four steps of your internal research chapter! The internal research helps you to strategize your research from the perspective of you as the future owner of your business. This section can be a bit dry and even long-winded (but needs to be said),- the good news? I hope it gave you a glimpse of your ideal life as a business owner. 

And in the next section, moving from internal to external research- it will be a little quicker to get through. So hang in there.

Joining the VIP Waitlist

Would you like early access to your copy of the book as soon as it is released and receive a bonus book companion coaching session?

During the private coaching session, I’ll guide you through the exercises and templates in the book. Available to the first 20 VIPs who purchase the book. To join the VIP waitlist, click here.