How to Get the Franchise Financing You Need

Purchasing a franchise is an excellent option that’s available for new investors and experienced ones alike. For investors like yourself, this move provides you with a business experience that’s much simpler than building a company from the ground up. After all, your average franchise typically comes with rules, training protocols, advertising campaigns and even an existing customer base, additions which really cut your work as an owner in half. However, that doesn’t mean that starting up a franchise is easy, or cheap. Fortunately, there are several ways to get the franchise financing you need for your next venture, such as:

SBA Loans

SBA loans are government-backed loans designed for the modern small business owner. These loans provide business everywhere – including franchises – with some of the best interest rates and repayment plans available. Typically, these are seen as the most practical and manageable franchise financing options. However, qualification can be difficult, and those that do qualify are likely to find that the application process is long and stressful, and can hold back operations, which is why many new franchise owners use alternative financing methods.

FF&E Financing

Another great resource for franchise financing is FF&E (furniture, fixtures and equipment). In this arrangement, you essentially take out a secured loan from a lender or financing company using these assets as a form of collateral. Because you’re offering something up, lenders are more likely to approve your loan request. You can simplify the loan by covering all of your equipment, fixtures and furniture under a single contract, which gets you the highest loan amount possible with the least amount of hassle on your part.

As a franchise owner, you’ll already be paying much less on a monthly basis than other startup business out there. However, when you choose to use FF&E financing, you can save even more money by writing off the expenses of leased or rented equipment and other assets on your taxes. This is because you’re leasing your assets rather than using a loan to purchase them outright. Yes, you’ll be paying for your items each and every month, but in the end it can save you a huge chunk of cash if you play your cards right.

Getting the franchise financing you need might be hard, but when you take a look at the options, you’re sure to find that you have several excellent routes to choose from. Thinking about your business’s future while making your decision is important, so take the time to consult a professional before making your final choice.


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