It’s often always about ‘ the other guy ‘. How did he, or she, get their franchise financed and completed so successfully? Let’s examine business financing for a franchise in Canada. How do franchise financing companies or other institutions assist franchisees such as yourself to be successful in acquiring and growing a business?
It’s of course ‘ the money ‘ i.e. the financing that is often the stumbling block to self employment, owning your own business, and financial success. And if you feel you are on ‘the outside ‘ of business financing in Canada we can only assume that roadblock is quite formidable.
That’s when clients we talk to are quickly surprise that just a few key basics immediately puts you ‘ in the game ‘ with respect to completing a business franchise acquisition . A good place to start is ensuring you have a respectable personal credit history – it is pretty close to impossible for you to complete a franchise acquisition without being able to demonstrate that you have managed your own personal finances successfully.
At this point you only need two other things to be successful, the ability to prepare and present a finance proposal that makes sense, and, secondly, to ensure that proposal is in front of the right person.
The right person? That often is one of the biggest challenges faced by Canadian entrepreneurs looking for companies and organizations that offer true business financing for a franchise. In Canada there are only one or two specialized franchise finance firms that offer full service franchise financing. Those services might include acquiring a new franchise, refinancing a current business, acquiring real estate for the actual franchise, and of course financing equipment and potentially leaseholds to complete a purchase.
Thousands of entrepreneurs just like yourself seem to think that the Canadian chartered banks don’t fully support the financing of a new franchise. They are 100% right and 100% wrong! That’s because the banks in Canada are the facilitators of the Government of Canada Small Business Loan. Over the years this business financing has been found to perfectly suit franchisee’s such as yourself who are looking to acquire a new or existing franchise.
But why is the Government program so successful. 3 reasons. Great rates, terms and structures. Although the program is capped at 350,000.00 that amount certainly covers 90% of the franchises we see from a viewpoint of financing to a turnkey situation. Terms are typically 5-7 years, personal guarantees are nominal, and the best part, rates are very competitive.
To successfully complete business financing for a franchise, via an independent finance firm or the government program you need a clear business and financial plan. An experienced Canadian business financing advisor familiar with franchises can complete that for you quickly, and at a low cost. It’s a clear recap of you, the business, and the financial potential.
Franchisee’s in Canada cant escape having to put their own investment into the business – that can range from 10-40% depending on a couple of key factors such as asset mix, size of transaction, and the proper execution of some clear financial projections .
Speak to a trusted, credible and experienced Canadian business financing advisor on the proper method to achieve franchise financing success. Do your homework, be properly prepared with your proposal, and get on track to independent business ownership via the franchise model in Canada.