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  • Writer's pictureCrystal Lizama, CFE

What is a franchise transfer? Resale?

A franchise transfer also known as a resale, is the process by which a franchisee transfers the ownership of their franchise to another individual or entity. Franchise transfers can occur for a variety of reasons, such as the retirement or exit of the current franchisee, the sale of the franchise to a new owner, or the transfer of the franchise to a family member or business partner.

Franchise transfers are governed by the terms of the franchise agreement, which typically includes provisions related to the transfer of the franchise to another party. The franchise agreement may specify certain conditions that must be met in order for the transfer to occur, such as the approval of the franchisor, the payment of any fees or penalties, and the completion of any necessary documentation and paperwork.

Franchisors typically have the right to approve or reject a franchise transfer, based on their own criteria and policies. Franchisors may require the prospective new franchisee to meet certain qualifications, such as having the necessary financial resources and business experience, in order to approve the transfer. Franchisors may also require the new franchisee to complete training or other requirements before the transfer can be completed.

Franchise transfers can have significant implications for both the current and new franchisee, as well as the franchisor. It's important for all parties to carefully review and understand the terms of the franchise agreement and the process for transferring the franchise, in order to ensure a smooth and successful transition.

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