Thinking Of Investing In A Local Sports Franchise? What To Know

Posted on: 19 September 2017

If you are looking to purchase a sports franchise, or to go in with other investors in a sports franchise, there are a few things that you want to do. You want to talk with the others that are considering this business venture, and with a lawyer, so you can get the right assessments that are needed before you make any moves. Here are some of the things that you want to do right away to get the decision making process started.

Get an Attorney

You need to get an attorney that specializes in these types of business ventures, and that can guide you through the business purchasing process. The attorney will request the books for the business, so you can go through the finances, and will help you determine if this sports franchise is a good buy, along with the following different profssionals.

Risk Management Consultant

You want to have a financial risk management consultant look at the money that it will take to invest into the franchise, and what amount of money will be needed for the loan and the first few years of operations, to determine if the franchise will be profitable. You have to see a return, and make a profit, in order for the purchase to a good investment. This professional should be able to give you long term financial expectation charts.

Franchise Evaluation Professional

There are a lot of things that can affect a sports franchise. The different things that can affect the franchise include:

  • Players and roster
  • Success throughout the season
  • Sponsorships and brands associated with the franchise
  • Cost of tickets and in stadium items
  • Economy in the area

The sports franchise evaluation professional will look at all these different factors to determine what the potential is for the sports franchise, and to determine if the current state can be improved, or turned around if it's bad.

There are a lot of different factors that can determine if the sports franchise is a business that is worth buying into, and if it could result in a large payoff, or if it's something that you don't want to get into. Sometimes it can take years to rebuild a sports franchise, but when you rebuild the franchise, it's value increases substantially and you can profit a lot. Talk with a lawyer and the other investors in the project to see if the sports franchise that interests you is worth the cost.