National Franchise Sales is a franchise business brokerage with experience in helping to purchase and sell franchises. If you’ve been considering buying or selling your own franchise, this company may be just the place to start. To help decide if it’s right for your needs, we’ve rounded up everything you need to know in this in-depth National Franchise Sales review below.
Overview Of National Franchise Sales
National Franchise Sales is a self-proclaimed industry leader in the business brokerage sector. They have successfully helped individuals buy and sell their businesses since 1978. That’s over 40 years in the business of business brokering and has amounted to a very knowledgeable team.
The company has experience in multiple areas and is not limited to a single unit, multi-unit, or other franchise types. In fact, they’ve been responsible for the successful transactions of multi-unit sales that have over fifty units. It certainly helps that the business has a ready-to-go pool ready to assist throughout the entire transaction process. From trustees and receivers to creditors and experts in bankruptcy and foreclosure, the National Franchise Sales team is equipped and ready to deal with any franchisee’s goals.
Also useful is the company’s many offices across the country. While many brokerages are location-specific and can only assist with local business transactions, National Franchise Sales is available in multiple locations, making it convenient and accessible.
A Bit More on National Franchise Sales History
As mentioned, the company has been in operation since 1978. With that, they claim to have sold more franchises than any other firm. According to the company, this success is partially due to the team’s ability to properly value franchises and locate quality buyers who are motivated to purchase.
They also credit their successes with the ability to source financing, adhere to federal and local business and transaction regulations, and to act as a middle ground that ensures the proper flow of information between all parties.
While other brokers may limit their interaction and involvement in the process, National Franchise Sales is committed to a hands-on process from start to finish. You’ll find your team or contact present from the first valuation to the date of transfer and all along the process in between. This is both to ensure that everything is done properly on the end of the company but to protect and empower buyers, sellers, lenders, and any other professionals involved in the process.
The National Franchise Sales Team
This brokerages team is fairly large compared to other similar brokerages. The team is extensive and features many different representatives for all of the transaction moving parts. We’ll take a look at a few of the main players.
Jerome Thissen is the president and founder of this company. His business background begins in the aerospace industry with Northwest Airlines. He subsequently left the industry after working his way up and acquired multiple fast-food franchises, all in the quest to start his own business. When a fellow franchisee requested assistance In acquiring a business, National Franchise Sales was developed soon after. In over forty years of business, Thissen helped to facilitate hundreds of franchise transactions. He is well regarded as an industry leader and has built quite the catalog of resources over the years. His contacts have resulted in even more transactions and have catapulted his success.
Following Thissen is Ingram, who acts as the company’s vice president. While he didn’t help to open the business, Ingram joined at the halfway point in 1997 as a regular employee and worked his way up to the vice president before becoming a full Partner six years later in 2003. Ingram works closely with both clients and industry professionals, helping to facilitate and educate along the way. Another of Ingram’s specialties is asset recovery. Along with this, he is familiar with foreclosure and bankruptcy, helping franchisees to emerge from failing businesses and subsequent financial troubles.
Gallup is the company’s Principal. He initially began in the restaurant industry back in 1971 and bought his first franchise in 1975. He worked for a few other brokerages, acting as Vice President of Operations and Principal for Crocker’s Restaurants, Inc. and then the Galardi Group Inc. Shortly after, Gallup joined this brokerage in 1994 and was promoted to full Partner in 2003. He now leads the Asset Recovery Team.
There are plenty of other important roles at National Franchise Sales, but for the purpose of this review, we’ll move on to other important factors relating to the business’ operations. The list includes partners, advisors, and supporting staff. All of which can be found on their website for more information.
Other Services Offered
In addition to the strict buying and selling transaction process at National Franchise Sales, they also offer a few other options for those that require modified services. Here, you can also find asset recovery, refranchising, advisory services, and valuations. Each of these offers a more catered service without the broker’s team being fully involved from start to finish in the process.
- Asset Recovery: This option helps under-performing businesses through the bankruptcy, foreclosure, and default process. You will also receive help to refranchise if that is the best course of action for your business.
- Refranchising: This option is ideal for franchise companies that are looking to increase capital and improve sales performance. There are programs for both regional and national franchise companies.
- Advisory Services: These services are a great option if a franchise owner needs assistance and advice. The brokerage is full of leaders with immeasurable market experience and insight – all of who are eager to lend a hand to those that are struggling or looking for the next best steps.
- Valuation: Understanding your business’ value is a major issue. This brokerage offers a comprehensive valuation of your business so that you understand its current standing. This can help you determine a listing price, even if you don’t list with National Franchise Sales. This can be done via a full appraisal or the broker’s opinion of value.
Types Of Businesses National Franchise Sales Sells
While this company focuses on franchise sales, there is no specific business that they opt for beyond that. For example, they don’t exclusively represent Taco Bell franchises or McDonalds. They are open to representing the buying and selling of most franchise businesses.
On the website, there is a helpful list of past sold and listed businesses. The list is quite expansive, but a few examples of past transactions in the US include:
- Jamba Juice
- Burger King
- Jack in the Box
- Papa Johns
- Steak & Shake
Current listings are similar businesses, such as Johnny Rockets, Popeyes, Baskin Robbins, and Jimmy John’s. So long as it is a restaurant or fast food, it appears that this broker is willing to represent the business.
National Franchise Sales Valuation Process
There are a few methods that National Franchise Sales uses to value your business, market appraisals, broker’s opinions of value, and formal appraisals. They range in accuracy, beginning with the least and having the most pinpointed idea in the formal appraisal.
When it comes to evaluating your company, many important details are considered. Things like the volume of sales, loss and gain comparisons, profit measurements, current lease arrangements and the remaining balance, and more are all important aspects in measuring your business’ value.
Also important are the unique franchise’s benefits. For example, is there a bar, are there frequent events thrown that generate business, such as karaoke night, the location and proximity to competitors, and so on.
There is no set measurement or equation that simply measures your franchise’s sales and slaps an overall value to the store. Instead, many unique aspects will be considered in order to give an accurate number. Luckily the broker’s team is filled to the brim with industry leaders who can accurately price your franchise so that you’re empowered to make business decisions.
Sales Process for Sellers
The process for selling your franchise is simplified on your end but intensive for the team at National Franchise Sales. Typically, this is the streamlined version of selling your franchise from the point of contact:
- Identify Targets
- Acquisition Strategy
- Process Stewardship
- Closing and Turnover
Now, within each of those neatly packed timeline markers, and even in between, there is plenty that happens behind the scenes. Adhering to state and federal regulations, communicating and negotiating between parties, the escrow process, and so much more are all within the sales process.
More specifically, here are some other important parts of the sale:
- Securing true market value, which can change throughout the sale process
- Sourcing and securing financing
- Pre-qualifying the buyer
- Contract preparation
- Timeline management
- Business plans, CTA analysis, and proforma plans
- Transfer oversight
Luckily, this broker’s team takes on most of this stress, but it’s important to know how complicated a complete transaction can be.
Vetting Process for Buyers
Each business is carefully considered before it’s listed with this brokerage. The process is rigorous but easy to understand, with a mission of protecting all parties involved. You can expect any franchise to be analyzed on a quality and quantitative level to ensure that it is suitable for sale. Money-making franchises are of the utmost importance because that is what buyers want and are willing to purchase.
While the company offers separate services like advisory to improve and grow your business, there is no guarantee that a semi-failing or non-performing business is equipped for sale here. All cases are considered on a case-by-case basis, and the brokerage will not list any operation that they do not fully believe in. Otherwise, it’s a waste of time for all parties, including themselves.
National Franchise Sales Success Rates
There are no clear statistics on the website for the number of businesses sold by National Franchise Sales. However, the claim is to be in the hundreds. One of the largest transactions that this broker was ever involved in was a $75,000,000 multi-unit sale.
According to a partial list of sales on the website organized onto a map display, there are plenty of successful transactions across the country. Areas that don’t seem to be serviced by this company include Montana, Wyoming, North Dakota, South Dakota, Nebraska, or Kansas. The bulk of successful sales seem to be concentrated across the west and east coast.
Fees Charged By National Franchise Sales To Sell A Business
Unfortunately, the National Franchise Sales website does not offer a clear display of fees to sell a business. This may be because they vary depending on the transaction amount or because they want you to contact them, and they can hopefully rope you in at that point.
When it comes to general franchise sale fees, the answers can vary as well, depending on the broker, location, and specific business assets. A quick Google search shows that franchise brokerage fees can be paid as a percent of the initial franchise fee. Depending on the sale amount, that can be between $30,000 and $50,000.
Other brokers may only charge a flat rate fee that is not dependent on the amount or that is on a sliding scale. For example, for properties up to $10,000, they charge $1,000. For properties between $10,000 and $50,000 they charge a flat $5,000. It just depends on the broker, and unfortunately, you’ll need to contact National Franchise Sales to learn more.
Pros And Cons Of Using National Franchise Sales
A Comprehensive Team
The team includes people from all backgrounds. This means that throughout the process of selling and potentially buying with this firm, you’ll have easy access to a host of information and insight that will help your transaction run smoothly.
Many Years in the Business
Similar to the above pro, a well-established business with decades in the industry means no growing pains and a team ready to help you succeed. Additionally, many assets and resources will have been built up over the years allowing for easier buyer location and pre-established contacts.
Experience in Multiple Franchise Formats
This broker has experience in both the sale of single units and multi-unit buildings. Ranging in use, primarily focused on restaurant and fast food, but not limited to those sections, the team will be able to assist with your unique needs and business.
For both buyers and sellers, there is a pre-established process that allows for painless and streamlined timelines. Rather than long delays as the next step is determined, they already have it all laid out for subsequent steps.
No Published Fees
While this may be a contact method to weed out motivated sellers by forcing them to contact for fee amounts, non-published fees can be worrisome. This means that each person who contacts the company may get a different answer at the company’s discretion. How can any single business owner be sure that they’re receiving a fair deal without some sort of universal standard?