Buying a franchise resale

A franchise resale is an existing location sold by its current owner to a new one, with the franchisor’s approval. It can be quicker than opening from scratch, the location already has customers and staff, and you can see what it actually earns. It can also be a way for an owner to get out of a business that doesn’t work. The difference is in the numbers, and this guide covers the costs a resale adds and what to look for.

A resale or a new location?

A new location gives you a fresh lease, new equipment and the full term of the agreement, but months or years of building up to full sales. A resale trades from day one, with a track record a lender can lend against. You pay for that: an established, profitable location sells for a multiple of its yearly profit, often more than the cost of opening a new one. A cheap resale is usually cheap for a reason, so find out what it is.

How a franchise transfer works

You agree a price with the seller, then apply to the franchisor as you would for a new franchise. The franchisor checks your finances and experience, may require you to complete its initial training, and usually asks you to sign its current form of agreement. The seller typically has to be up to date on royalties, sign a release of claims against the franchisor and pay the transfer fee. Many franchisors also require the location to be refurbished to current standards before the sale closes.

Franchise transfer fees

Of the 1,611 brands whose transfer fee is known, 1,279 charge a flat amount, from $500 to $65K, with a typical $10K. Another 272 charge a share of the franchise fee a new owner would pay, typically 50%, and 42 take a share of the sale price.

The fee pays for the franchisor’s work in vetting and training the new owner, and it is small next to the price of a working location. What costs more is often the rest: the refurbishment the franchisor requires, the training travel, and any higher royalty in the current agreement.

Transfer fees at well-known brands

The transfer fee for the most searched brands, as each states it:

Transfer fees by industry

Industries with large, valuable locations charge the most to transfer, since the franchisor’s review is bigger and the sale price higher. Food brands charge less, and many restaurant systems with lots of resales keep the fee low to keep owners trading.

Franchisor buy-backs

Franchisors bought back 4,792 locations from their owners between 2023 and 2025, against 34,320 locations that closed, were terminated or weren’t renewed. Of the 1,133 brands with a full record, 268 (24%) bought back at least one. A few large systems account for most of the total.

Buy-backs can mean the franchisor is investing in its own locations, rescuing struggling ones or settling disputes. When you buy a resale in a system with many buy-backs, ask why, and whether the franchisor has resold those locations and to whom.

What to check before buying a resale

Ask for three years of the location’s profit and loss statements, its tax returns and its royalty reports to the franchisor, and check that they agree. Compare the location’s sales with the brand’s published figures, where it has them; the most profitable franchises ranking lists them. Read the lease: how many years are left, what the rent will rise to and whether the landlord must consent to the sale. Ask how many years remain on the franchise agreement, or what the new one will charge.

Then talk to the franchisor about the location, and to other owners nearby. A franchisor that knows a location is weak may still approve the sale, so ask directly how it ranks in the system. The agreement terms guide covers term length and renewal fees, and the financing guide covers SBA loans, which can also pay for a resale.