This is a question that I get often from my clients. However, since lawyers are not the most qualified professionals to answer this question (compared to a business appraiser or specialized consultant) I am not the most qualified to answer this question. That said, business valuation is key and must be discussed with your lawyer prior to committing to a purchase agreement. While I am emphasizing the obvious, this issue comes up daily and in many transactions purchasers become “attached” to the idea of becoming a business owner and entrepreneur and let their guard down as to valuation. So while your lawyer can not value your business, you must be taking every step to do so – preferably with the assistance of a qualified business account and certified business appraiser. All of this should be coordinated with your business and franchise lawyer whose job is to ensure that you (and your contract deposit) are legally protected during this review period / due diligence.
Some important factors that a prospective business / franchise purchaser should consider:
Essentially, leave no stone unturned. By the way there are a multitude of valuable resources out their, always be circumspect, but check them out, i.e., www.franchisepick.com, www.thefranchiseking.com, www.unhappyfranchisee.com.
Category: Buy a Franchise
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