Don’t Fall For Wrong Info On Getting A Canadian Franchise Business Loan - Get The Bank Franchising Finance You Need

Accept No Substitutes For Real Info On Franchise Financing In Canada



Information on how to get a franchise business loan . Franchising finance with and without the bank . Finance Your Entrepreneurial dream today




Misinformation. It's everywhere it seems. That’s why we think there's some room for some solid information around a franchise business loan in Canada, with, and without the franchising bank finance you are probably looking for.

The whole issue of ' the bank ' is probably where a lot of the mystery, apprehension and misinformation lie when it comes to franchising finance in the Canadian marketplace.

When you understand how the banks participate in franchise finance and your loan in particular things get a lot clearer. We think if we lined up ten business people and entrepreneurs and asked them if they thought banks would finance their franchise... well we hesitate to guess their answers, or coments.

The reality though, approached under the right circumstances and program the fact that you are purchasing a proven business model is actually very appealing to the bank - Again, under the right program.

So where do things go wrong? One of them when we talk to clients is simply the fact that they are incorrectly assuming that the financing they are looking for will be a loan for 100% of the purchase price. We only wish!

The reality is that you must be prepared to inject certain funds; we'll call it an equity or owner investment, into your business. Under the right franchise finance program that permanent injection can be as low as 10%. Naturally certain other ratios around liquidity and debt have to make sense.

Remember also that the right mix of debt, i.e. what you owe, and equity, i.e. what you put in is the classic success story for any business financing. It's all about the right blend. You don’t want to drain all your personal resources, that’s for sure - at the same time you want to be in a position to pay yourself and your franchising finance loan and show a reasonable profit also.

We keep referring to a ' program' Specifically its the government BIL program which is administered by the banks but underwritten, or ' guaranteed' substantially by the government , to your lender, the bank!

Clients often ask us if they can get franchising assistance from a finance point of view from their franchisor. We're skeptical that happens a lot, and if it is it’s certainly in a limited fashion - so don’t hang your hopes on that dream too much!


Does being prepared make sense to you in business? It sure has to us! That’s why a very simple basic package that covers info on yourself, your new proposed business, some financial projections and other misc data make a franchise business loan happen a lot faster.

What about the financing costs for that loan ?The truth be told ( and we did promise you the truth ) is the BIL program has the best rates in Canada for any start up business, which is more or less what your new franchise is . Rates are in the 3% over prime range, and other enhancements to the overall credit package of the program are very
attractive to you, the business borrower.

Your own business background and personal credit rating play a key part of any franchise financing decision. Be prepared to demonstrate paying your taxes on time, having good payments with your creditors, etc. Typically you won’t be asked to put up additional personal collateral such as homes, savings, etc. But again, that's if you have presented your overall picture properly.

We often supplement client financing with equipment leasing on certain assets when that makes sense - that might include P.O.S. systems, computers, etc.

Want to make sure you are getting the real scoop on franchise finance in Canada. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in this area; thereby enhancing your business success potential.




Stan Prokop - founder of 7 Park Avenue Financial -


http://www.7parkavenuefinancial.com



Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing .Info re: Canadian business financing & contact details :



http://www.7parkavenuefinancial.com/franchise_business_loan_bank_finance_franchising.html

Ten Things Mom Didn’t Tell You About Financing Options For A Canadian Franchise Business Loan

Demystifying Franchise Finance in Canada





Information on financing options for a Canadian franchise business loan . Debunking popular myths in franchise finance and focusing on how to successfully complete your acquisition of a new or existing franchise opportunity .





If there is one business segment that is not ‘out of favor ' these days its the franchise industry ... not the least of which reason is that a huge per centage of the Canadian economy depends on sales from this entire industry .



Clients have very similar questions when it comes to a franchise business loan, revolving around their need to realize the entrepreneurial dream with financing options that make sense for their particular situation.



We thought we would cover off ten of the most popular questions/issues around franchise business loan financing options, many of which stem from mis - information they have received or simply their desire to get some solid answers to fundamental questions.



So here we go! How long does the financing process take? Typically we advise clients that they should be assessing their financial options in tandem with their progress on selecting and formulating their final decision around which franchise to purchase. We see many instances where a client has lost a lease or location because they were not able to commit to financing approval. In many franchise segments the proverbial three things reign supreme - location, location, and... you guessed it... location!



Is there a lot of ' red tape' when it comes to exploring financing options for franchising? Our answer to that simply is that a franchise is a business and you should understand that the key issues revolving around the purchase of any business - i.e. due diligence, a business plan, a financial plan, miscellaneous costs, etc are all in place in franchising.



If we are turned down elsewhere can financing approval be still obtained. Absolutely... positively, it’s a case of seeking the best alternative that fits your total purchase price and owner investment into the business... ie your equity contribution.



Can both small and large franchises be financed? One or two specialized commercial finance firms dominate the major franchise market when it comes to large cap franchise investments. These transactions can be in the millions, and often involve real estate. However thousands of franchises are financed everyday in the 50-500k range.



What are franchise loan funds used for? In the mainstream of financing for franchises the finance covers equipment assets, leasehold improvements, and in some cases working capital. Many soft costs, such as your franchise fee typically can’t be financed.



How much can we borrow? Boy do we get that one a lot. The BIL program which covers a majority of franchise financing options does max out at 350k... other complimentary financing such as working capital term loans, merchant financing, and equipment leasing can provide top up financing.



What are my requirements to get approved for a franchise loan? Two key requirements are a reasonable personal equity investment into your new business, as well as a reasonable credit history and business track record in your new or related industry.



Can franchise financing be arranged on an existing franchise? Absolutely, positively... that’s a yes! A different strategy is involved, as we are now looking at an existing business with financials, assets, cash flow record, etc. But re -sales can be financed!



Can real estate be financed with a franchise acquisition? Our answer to this one is simply that normal real estate financing guidelines apply, so whether you are purchasing a mfg. company of a restaurant franchise the real estate component would typically be financed separately through a holding company you might set up.



Does franchise financing cover the construction costs of my new business? Yes, that is exactly what many programs are used for.



That covers a lot of the basics. Carefully planning via a business plan and financial projections are key. In any business expert advice gets you to the goal line faster. Seek and speak to a trusted, credible and experienced Canadian business financing advisor who can help you get to ' the dotted line!’







Stan Prokop is founder 7 Park Avenue Financial ;





see http://www.7parkavenuefinancial.com



Originating financing for Canadian companies,specializing: working capital, cash flow, and asset based financing , the 7 year old firm has completed in excess of 80 Million $ of financing for companies . For info / free consultation on Canadian business financing / contact details see:





http://www.7parkavenuefinancial.com/franchise_business_loan_financing_options.html

Surviving The Franchise Business Loan Process - Doing it Right In Franchise Finance Funding in Canada

We wouldn’t say that it’s a life and death situation, but clearly surviving the entire franchise business loan process with a final result of successful franchise funding of your new business is clearly a victory on your part.

Let’s examine how you find franchise finance funding in Canada and the most efficient methods to complete the process when it comes to time, resources, and utilizing proper expertise.

Although there is somewhat of a negative spin on business funding and business financing in general the reality is that as a whole the franchise industry is viewed as a positive ' vertical market ' by the lenders that participate in this area . Many new entrepreneurs will be surprised to hear that one government financing vehicle is actually the most utilized by new franchisees.

We also sometimes forget to reference the fact that when it comes to a franchise funding that whole process can also involve your purchase of an existing franchise where the current owner is motivated to sell. Certain processes, procedures and recommendations on buying an existing franchise are somewhat different than your traditional new ' turn key ' approach to a brand new franchise.

So let’s get back to our ' survival ' theme. What elements of preparation are critical to that? Many franchisees we talk to complain or tell horror stories of the time it took them to finance their business. Our observation on that is simply that if you are not fully prepared up front to present a package to the right party, containing all the critical elements... well you know what comes next... there is just simply a tremendous amount of back and forth and potential frustration on your part . And don’t forget you also run the risk of alienating your lender and being perceived as ill prepared to own and run an entrepreneurial business.

So what you do need to have in that packaged that allows you to survive the entire financing process?
The key elements are a concise business plan as a good start! We also caution franchisees that the plan should focus on repayment of the loan and franchise funding itself - with less emphasis on all the marketing and ' pr ‘type material that is in many plans we see.

Key elements of that plan are your background and experience. If you are purchasing a business and looking for a franchise business loan in an industry in which you have no experience be aware that that will be come a discussion point with the lender. In reality any business person that has solid overall management experience and skills, coupled with some financial acumen should be in a position to ‘up sell ' their skills as a new franchisee and entrepreneur.

We speak of the ' lenders ' in franchise finance funding in Canada. If you don’t know who they are we can virtually guarantee you frustration and a potential decline of your proposal.

The largest franchise lender in Canada... are you ready for this... is the government of Canada by virtue of their support of a special program called the BIL/CSBF loan program . The majority of franchise business funding is done through this program. By the way it has great rates, terms and structures that are often perfect matched to your needs.

In summary, we can clearly say that a franchise business loan is not 'rocket science ' ; identify a suitable BIL/CSBF loan partner , prepare a clear package that’s focused on your and repayment of the financing, and consider seeking the services of an expert in Canadian business financing in the franchise area . You'll find you have survived the process and come out on the other end approved and ready to commence your role as a new Canadian business owner in the franchise industry.

-



Stan Prokop - founder of 7 Park Avenue Financial -
http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/franchise_business_loan_franchise_funding_finance.html