Preparation For A Sale - Execution Strategy
Company Added
Company Removed
Apply to Request List

Preparation For A Sale - Execution Strategy

Preparation For A Sale - Execution Strategy

Preparation is an important part of any business pre-sale planning, whether you are selling part or all of your business. To begin, owners and key stakeholders must decide and align on a business strategy. Then, owners must make sure they are prepared for a sale and the challenges that may accompany it. Finally, no matter how well-planned any exit strategy may be, it all comes down to execution.

Carty Davis, a boutique investment bank partner who has completed hundreds of transactions in the multi-unit franchise and restaurant space, writes that preparing for a sale means aligning strategy, getting the financial house in order, and developing a plan for execution.

Here's what he says about the preparation phase:

Execution strategy

The next step for owners is to consider how to execute the strategy they've developed.

  • Franchised businesses. Sales of franchised businesses are almost always subject to franchisor review and approval. While the owner can select a buyer or partner, franchisor approval is necessary to consummate the transaction. Before moving forward with any buyer, franchisees must understand and manage the franchisor's approval process and financial and operational requirements. In more and more cases, as a condition of approval, franchisors are requiring reinvestment commitments to effectuate a transfer. It is important to understand these requirements and articulate them to potential buyers or partners. Exactly when to engage the franchisor can be complicated and will depend on the seller, buyer, and franchisor.
  • Transfers to the next generation or existing management team. If the sale is part of a transition to the next generation or existing management team and does not involve changes to the capital structure, managing the relationship with your existing lenders is critical. Financial institutions do not like surprises, so it is important to communicate early and often. In most cases, lenders will be supportive if they understand and have been part of the transition process. If the value of the assets being sold is questioned, obtain reasonable consensus with lenders to avoid any delays. Decide early who within the organization should be party to the transaction and make sure any key personnel are not surprised by the transition. To ensure a successful completion, it can sometimes be helpful to incentivize key team members.
Published: September 24th, 2019

Share this Feature

Scooter's Coffee
Scooter's Coffee
Scooter's Coffee

Recommended Reading:


comments powered by Disqus
The Joint Corp.


Caesar's Forum, Las Vegas
APR 6-9TH, 2021

The success of the Scooter's Coffee franchise is based upon a commitment to quality products, fast and accurate service, and always delivering...
Cash Required:
Request Info
Shakeaway is a unique global company with stores popping up all over the world! Get involved in this fun, fast growing and profitable franchise now...
Request Info

Subscribe to Multi-Unit Franchisee Report

A Franchise Update Media Production
Franchise Update Media
P.O. Box 20547
San Jose, CA 95160
PH. (408) 402-5681
In Loving Memory Of Timothy Gardner (1987-2014)

Copyright © 2001 - 2020.
All Rights Reserved.