Ways to Fund your Latest Franchise Opportunity
A franchise sale refers to a situation where a business owner, sells the right to the business name, the products, and the brand for a specific period. The franchise terms can be renewed if the parties agree. Obtaining a franchise involves the payment of advertising and royalty and franchise fees. Identifying a franchise opportunity might be hard, but finding a financier willing to fund it is even harder. The tips below will be helpful should you be in need of a franchise fund.
• SBA loans: An acronym for Small Business Administration loans, these are available to franchisees who meet certain criteria. Ideally, such loans require a small amount of down payment and have longer repayment terms than most conventional banks.
• Franchisor: In some cases, the franchisor could be a great source of funding. Not only could they waiver the franchising fees, but they could also provide no principal loans or give a financing plan for equipment leases as well as for other operational costs.
• Get a loan from a commercial bank or credit union: For you to qualify for a loan in any of these, your credit history and net worth will have to be reviewed. A complete business plan will have to be prepared along with some form of collateral. In most cases, franchisers are preferred when it comes to advancing cash as the lender has trust in the business model and the brand.
• Engage a business partner: An investor could help you raise the starting capital for your franchise. Alternatively, a business partner will help you front the money. You need to plan on how you are going to run the business before it commences to avoid misunderstanding in the future. Agree on how you are going to split profits, who will oversee the business and how employees will be paid.
Contact the Financial Marketing Group for more information about how to fund your latest franchise opportunity.