Thinking of Buying a Franchise Resale Business in Australia? Here Are 3 Vital Questions to Ask
The Australian franchising industry generated $201.2 billion in revenue in 2025, with profit margins averaging just 3.1%. Franchise resales — where an existing franchise location is sold by its current owner — have become increasingly common as operators exit due to rising costs, challenging trading conditions, or retirement.
Despite recent volatility from interest rate rises, high inflation, and cost-of-living pressures, the sector is forecast to grow modestly at 1.5% annually through 2030, reaching $216.7 billion. Strong consumer brands, established systems, and regional population growth are expected to fuel recovery, while regulatory scrutiny under the Franchising Code of Conduct continues to shape buyer protections.
1. Is the Franchise System Reputable and Compliant?
Why It Matters
A franchise resale inherits both the brand’s strengths and its weaknesses. High-profile scandals in retail food, convenience, and services led to significant reforms, including doubled penalties for breaches of the Franchising Code of Conduct. Buying into a system with poor compliance, unfair contracts, or weak support can undermine long-term profitability.
What to Check
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Franchisor history – Review any past legal disputes, media scandals, or wage underpayment cases.
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Code compliance – Confirm the franchisor adheres to disclosure obligations under the ACCC-administered Franchising Code.
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Support & training – Assess whether the franchisor provides ongoing operational, marketing, and compliance support.
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Brand reputation – Investigate consumer reviews, franchisee satisfaction surveys, and brand strength in the marketplace.
2. Are the Financials of the Specific Outlet Sound?
Why It Matters
A resale differs from a new franchise because the outlet has an existing track record. However, financial performance can vary significantly between outlets depending on location, rent, staffing, and customer base. Rising purchase costs, rent, and utility expenses have eroded profitability across many segments.
What to Check
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Historical performance – Review at least three years of financial statements to assess sales stability and profit margins.
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Cost pressures – Identify trends in wages, purchases, and other major expenses relative to industry averages.
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Lease terms – Confirm remaining lease length, rent increases, and whether landlord approval is required for the transfer.
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Transition costs – Consider transfer fees, refurbishment obligations, and working capital needs during handover.
3. Does the Business Align with Market Trends and Future Growth?
Why It Matters
Franchise systems that adapt to consumer preferences, digital platforms, and regional growth are better positioned for long-term success. Online sales, mobile service models, and demand for healthier or more sustainable products have reshaped performance across segments.
What to Check
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Sector resilience – Assess whether the franchise operates in a high-demand area such as food services, personal care, or convenience retail.
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Technology adoption – Review the franchise’s use of ecommerce, apps, loyalty programs, and digital marketing.
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Regional demand – Consider whether population growth in regional areas supports future outlet performance.
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Exit strategy – Ensure resale value is likely to be maintained or improved through location, system strength, and brand investment.
Ready to Invest in a Thriving Franchise Resale Business?
With strong consumer brands, proven operating systems, and growing demand across multiple sectors, franchise resales offer a lower-risk entry point compared to starting a new franchise.
Success depends on choosing a reputable franchisor, verifying outlet-level financials, and ensuring alignment with long-term industry trends.
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