In this FDD Talk post, you’ll learn the following:
- Section I – Background information on the First Choice Business Brokers franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a First Choice Business Brokers franchise, based on Item 7 of the company’s 2017 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a First Choice Business Brokers franchise, based on Items 5 and 6 of the company’s 2017 FDD
- Section IV – Presentation and analysis of First Choice Business Brokers’ financial performance representations, based on Item 19 of the company’s 2017 FDD, including information on the:
- five-year business plan projection (including projections for business sales commissions – owner and associates, total income, marketing, total cost of sales, gross profit, accounting fees, miscellaneous, salary/wage/reception/assistant, telephone, transport/auto, office rent, royalty fee, total expenses, and net profit/loss) that was created by the franchisor’s affiliate, Las Vegas 101, in connection with its plan to open and operate a First Choice Business Brokers Office in Salt Lake City, Utah
Section I – Background Information
8 Things You Need to Know About the First Choice Business Brokers Franchise
Awards 2016 Top Sales Associates Nationwide
1. At the 2017 First Choice Business Brokers National Conference on June 2, 2017, the brand honored its 2016 Top Sales Associates Nationwide. The award went to the Los Angles team of Adrianna Smith and Lana Hout.
2. Linda Hentges-Nyman, chief operating officer of First Choice Business Brokers, said, “Lana and Adrianna have demonstrated amazing talent in market pricing and deal structuring to get the deals done.” Adrianna Smith, who is the managing director of the Los Angles location, said that she and Hout were honored to receive the award and that it was a “testament to [their] passion and dedication to serving [their] clients.”
Named a Top Boutique Broker by Inc.com
3. In late 2016, First Choice Business Brokers was named one of three top boutique brokers by Inc.com. The list went on to explain that a boutique broker was best for small and medium-sized companies with revenues under $100 million. The company earned the number three spot and Inc.com noted that First Choice Business Brokers was the boutique broker to go to for confidential selling.
Key Factors That Help First Choice Business Brokers Stand Out
4. First Choice Business Brokers says that its services go beyond matching business owners selling their businesses with buyers. Its agents help clients calculate the appropriate value for their business and help them negotiate favorable terms in the sale of their business.
5. In addition to making sure sellers get the right amount of money for their business, First Choice Business Brokers says that the following five factors differentiate it from the competition:
- Valuation and Pricing: Agents work hard to get sellers the greatest possible value without turning away prospective buyers.
- Aggressive Marketing: First Choice Business Brokers does more than just list a business for sale online. Its agents use social media, email campaigns, investor forums, direct mail, telemarketing, and referral networks to spread the word about a business that is for sale.
- Capital Sourcing: The company comes to its clients with several years of experience working with SBA and commercial lenders as well as private capital sources.
- Transaction Management: Agents work to avoid surprises and help with leases, financials, timelines, government regulations, agency clearances, and buyer/seller disagreements.
- Transition Management: The company ensures that all sides work cooperatively toward the success of the new owner.
6. First Choice Business Brokers was founded in 1994 in Las Vegas, Nevada. The company specializes in buying and selling businesses around the United States. First Choice agents match business owners selling their businesses with interested buyers. It is in good standing with the Institute of Business Appraisers, International Business Brokers Association, and Las Vegas Chamber of Commerce.
7. According to the company, it has listed and managed the sale of over $7 billion in businesses for sale. First Choice Business Brokers began franchising in 2005 and today, there are 16 locations across ten states. The company is currently looking for Master Franchisees in international markets such as Europe, Canada, India, China, Australia, and the United Kingdom.
Entrepreneur’s Franchise 500
8. First Choice Business Brokers has appeared twice on Entrepreneur’s annual Franchise 500 list since it first started franchising in 2005. The company ranked No. 448 in 2010 and No. 466 in 2009. It also earned a spot on Entrepreneur’s 2010 Top New Franchises List at No. 24.
Section II – Estimated Costs
- Please click here for detailed estimates of First Choice Business Brokers franchise costs, based on Item 7 of the company’s 2017 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on First Choice Business Brokers’ initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2017 FDD.
Section IV – Financial Performance Representations (Item 19, 2017 FDD) and Analysis
- The following contains the five-year business plan projection that was created by the franchisor’s affiliate, Las Vegas 101, in connection with its plan to open and operate a First Choice Office in Salt Lake City, Utah.
- The projections of revenues and earnings are based on expected activity level in the respective First Choice Offices in their first five years of operation.
- The calculations are based on assumptions made regarding the number of transactions that the franchisor’s affiliate believes they can complete, and the amount of commissions they will charge.
- The projections are based upon the franchisor’s affiliate’s (and the owners of the franchisor’s affiliate’s) 20 years of experience of owning and operating a business brokerage office.
- These numbers are unaudited and no certified public accountant has audited these figures or expressed an opinion with regard to the content or form.
- The expenses are calculated based on the franchisor’s experience and knowledge of current economic conditions, the expenses of running an office (which is required if you have Associates, otherwise a home office is acceptable as long as an adequate meeting place for clients is used which is not the home office).
- Based on the experience of the franchisor’s affiliate, these projections are reasonable reflections of the income that a franchisee can earn in the System. Your individual financial results may differ from the result stated in this financial performance representation.
- The franchise model allows franchisees to build a team of Associates if they desire. This projection was based on assuming a slower entry into the business. The assumption in this projection is that the business will be run by one person (in a franchise model, a franchisee working for him or herself and with no Associates) working from a home office, then year by year adds Associates and grows the business slowly but steadily.
- Certain assumptions have been made regarding how well each Associate will do. The actual results of each Associate could be higher or lower. These projections do not reflect the levels attainable through full maximization of the franchise system.
Item 19 FDD Projections for First Choice Business Brokers