Many hopeful entrepreneurs who always wanted to own their own business decide that purchasing a franchise has the attractive features that they are looking for. SCORE Client Andrew Halout decided to go that route with the purchase of a WAYBACK Burger location in Millersville. But as with all things, the devil is in the details, and this made the factors to explore and consider in advance even more critical. Andrew reached out to SCORE Lancaster-Lebanon for help in this process.
In August of 2017 one of the SCORE “dream teams” soon went into action to guide Andrew on the path to ownership and profitability. Lead mentor Jerry Glenn began the process of helping to value the business and worked on providing Andrew with negotiating discussions topics with the previous owner. There were also financials that needed to be developed for this venture to take to the bank. It was time to call in SCORE Lancaster-Lebanon top-gun, financials mentor Lou Davenport.
Purchasing a franchise can be the best move for that aspiring entrepreneur who might not want to create a business from scratch. But there is lots of homework that needs to be done before closing the deal. Once Andrew decided that the WAYBACK Burger model was the right choice for him his SCORE mentor team kicked in to help him prepare the groundwork he needed before he could get to putting a key in the door. Consultations like this are often done with a paid professional or consultant but Andrew’s volunteer mentors represented significant savings for achieving his burger-dreams. Over the course of four months the SCORE mentor team’s tasks include:
analyzing and reviewing 3 years of financial statements of the target business he was seeking to acquire, assessing strengths, weaknesses, opportunities for improvement
developing a business valuation of the target business and mentoring Andrew on price negotiation and deal structuring
assessing sources of bank financing, choosing a bank, structuring a satisfactory term loan, and working capital line of credit to help finance the business purchase
developing pro-forma financial forecasts and a financial budget for operations under his new ownership
Andrew Halout successfully closed on his WAYBACK Burger deal on December 30, 2017, and it has become a favorite spot now for his SCORE mentors to grab a tasty, made-to-order burger, or a hand-dipped milkshake. While the WAYBACK franchise provides the franchisee with assistance, the SCORE Lancaster-Lebanon mentors have now been working on various marketing ideas with Andrew to grow the business. They will continue to meet on a regular basis and to provide support where ever it is needed.
“The biggest help my SCORE Lancaster–Lebanon mentors provide with my WAYBACK Burger franchise is being able to project my financials. It is a forecast for how much I am able to spend. They also help me with marketing and advice on how to handle employees. But one of the most important things that Jerry and Lou offer is accountability. They always try to lead me down the right road.”
Andrew Halout, owner WAYBACK Burger of Millersville, PA