Franchise Financing-Insights on Funding Your Dreams
I recently attended the International Franchise Expo (IFE) sponsored by the International Franchise Association. The IFE is the largest franchise expo gathering in the country, representing about 450 franchises. As an attendee for many years, it is exciting to see the growing popularity of franchising as an investment and business ownership option. Some interesting trends at this year’s conference:
- All-time high attendance by franchise organizations and potential franchisees
- Growth of non-U.S. based franchise organizations
- Expansion of creative franchise financing options
The most important of these trends, of course, is figuring out the best way to obtain financing. As a new business owner, how you decide to finance your initial or ongoing franchise expenses is one of the most important decisions you will make. Some of the most popular options include:
Franchise owners, especially first-time business owners, often run into financing challenges. They are frequently asked to use personal credit when business credit would be the preferred alternative and getting a bank to approve a commercial loan can be difficult. In addition to franchise entry fees, financing can be used to fund:
- Equipment costs
- Real estate purchases
- New construction
- Marketing promotions
- General working capital needs
If you are considering becoming a franchise owner here are a few important tips:
- Take your time during the franchise review process
- Carefully review all franchise disclosure documents
- Talk to current and former franchise owners
- Take full advantage of franchise discovery days (site visits)
- Focus on the potential success of the business model and not the emotion and excitement of the franchise offer
With the growing complexity of financing options, it is important to work with a trusted resource to help you navigate the pros and cons of the various alternatives.
At RJC Capital, LLC, we will help you successfully navigate the funding process and help you find the optimal solution for your needs. As a small business owner and a previous franchise owner, I understand the unique challenges that confront franchise and other small business owners. Our singular focus is helping you reach your goals and dreams as a business owner. Call or e-mail us for a free consultation. I wish you great success in your franchise adventure!
Learn more about our franchise financing solutions.
Russell J. Campbell, President
RJC Capital, LLC