Franchising Today - Fall 2016 - 21

VALUATION

on retirement locations, real estate you want to own, investment
portfolio expectations and many
other considerations.
2. Capital partner. Bringing in an
outside source of capital is an excellent way to begin diversifying
your net worth away from your
business entities. It also diversifies financial risk by taking some
chips off the table. As an example,
private equity firms are currently poised to invest new capital in
franchises, offering sophistication and increased efficiency to
run a business.
This doesn't mean you're giving
away the reins to your business,
however. You can continue to
keep a significant upside of partial ownership. But you can also
secure diversified assets to prepare for the next stages of your
life. Capital partners need not be
solely institutional; adding employees, securing bank financing
or individual limited investors
can accomplish similar diversification of your assets away from
your business.
3. Succession planning via rewarding. The concept of succession planning can be daunting for
a franchise owner. Many struggle
with figuring out how to select
the individual who will lead their
business well after they are gone.
One critical step can involve rewarding key employees with equity participation. This can come
in the form of direct equity in the
operations or phantom equity
plans mirroring ownership. This
is a great incentive for key employees to participate in the profit and have more skin in the game.
4. Family transfers. If you have accumulated enough wealth to be

Bringing in an outside source of capital
is a way to begin diversifying your net
worth away from your business entities.

financially secure for retirement,
you may want to consider passing
the business on to future family generations. You can opt for a
full transfer of business entities
as gifts. This can be structured to
minimize estate taxes and provide
the most assets for your family.
Alternatively, you may want to
freeze the current franchise valuation. With current low interest
rates and easier access to capital,
there are many ways of substituting the franchise value with a cash
or liquid value to maintain your net
worth but create ample liquidity.
5. Acquiring more franchises.
Keeping in mind the current relative ease of accessing capital, you
may want to look at expanding
your business. Utilize a wealth
advisor to help you model future
possibilities, map site acquisitions, run predictive analysis and
work with you on other expansion ideas. Plus, franchises are

now more frequently expanding
overseas. International ventures
are expected to accelerate in the
years to come.
Whether contemplating a complete
sale and business exit, bringing in a
capital partner to create some liquidity to minimize risk, rewarding employees to become owners of the operation, transferring equity to family
members or acquiring more franchises and scaling your company, franchise owners should always be analyzing all their strategic options. Now is
a great time to consider these alternatives in order to maximize the value of
your business for the future
Keith Plywaczynski is managing partner
and a senior wealth advisor at Mariner
Wealth Advisors. He works primarily with
high-net-worth individuals and specializes
in helping corporate executives and business owners
navigate the various complexities that impact their
families and long-term financial goals. For information
on Mariner, please visit: http://www.marinerwealthadvisors.com.
FALL 2016

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Table of Contents for the Digital Edition of Franchising Today - Fall 2016

Contents
Franchising Today - Fall 2016 - Cover1
Franchising Today - Fall 2016 - Cover2
Franchising Today - Fall 2016 - 1
Franchising Today - Fall 2016 - Contents
Franchising Today - Fall 2016 - 3
Franchising Today - Fall 2016 - 4
Franchising Today - Fall 2016 - 5
Franchising Today - Fall 2016 - 6
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Franchising Today - Fall 2016 - Cover3
Franchising Today - Fall 2016 - Cover4
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