Re-franchised Locations: Buying a Company Owned Franchise Location | Franchise Law Blog

Re-franchised Locations: Buying a Company Owned Franchise Location

Buying a Company Owned Franchise Location

In a recent article “Refranchising: Should you Buy In?” Jeff Elgin‚ CEO of FranChoice Inc.‚ discusses a trend that has recently become more popular among franchise companies recently called refranchising or retro-franchising.   The process of refranchising is when a franchise company converts a company owned unit or location into a unit that is available to be sold to a franchisee.  Refranchising has been becoming more popular in recent years and there have been many franchise companies that have been converting not just one but a significant number of units to a franchise location for franchisees to purchase. 

Franchisees considering the purchase of a refranchised location should consider doing thorough research before making a decision to buy into the refranchised unit.  Your main concern as a potential franchisee of the company you are looking into and as potential buyer of a refranchised unit should be “why does the franchise want to sell the unit?”  According to Jeff Algin there are multiple reasons that can trigger a franchise company to refranchise their units:

When deciding to purchase a franchise location that is re-opening or a unit that is being refranchised for any other reason always make sure you perform due diligence.  To avoid making a bad franchising decision and for more information on how to perform adequate due diligence read Franchise lawyer Charles Internicola's article "Why Due Diligence is Critical when Buying a Business or Franchise". 

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Date: 11/10/2009 | Category: Buy a Franchise

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