Does Canadian Franchise Financing Success Mean Everything To You ? Tips/Info Franchising Company Lenders / Loans

We can pretty safely bet that after you have made a decision to purchase a franchise in Canada that franchise financing becomes, at least temporarily, one of the most important priorities in your life. Let’s examine some tips, info, and strategies allowing you to work through, successfully, the finance company and the various lenders and loans available to yourself.

In speaking to many clients it’s quite clear that the type and style of franchise they wish to purchase is often tied to their perception of their ability to close financing on that purchase. And when we look through the business news these days it seems that all types of businesses, from start up to large corporations have formidable financing challenges.

The reality is though, that if you have priced your franchise purchase properly relative to your own personal situation, which includes your credit history... that you should be in a position to acquire the financing you need.

So what are the ingredients to that success? Some of the key basics are a ' proper' proposal and your ability to commit some capital to the business. Clients are always concerned about how much owner equity they will have to put into the business - In Canada our experience is that typically is in the 10 - 40% range, with 10%being the absolute minimum.

Franchise financing is sold on the basis of your business plan. That document does not have to be as formal as you think, but it should include the essence of what you are trying to achieve. Those basics include info about yourself, your work and career history, your personal financial situation. The document should then cover off details on your franchisor, the business model they operate under, and finally, and perhaps most importantly a credible financial projection.

We're often asked how much detail goes into the financial projection for the franchise financing company or bank. The simple answer to that is that you should be demonstrating in a clear fashion how the loan or loans will be repaid.

We encourage all clients, via vigorous discussion to ensure they are in a position to defend their sales and cash flow projections - and, as importantly, are prepared to answer any questions the lender might have. A clear presenation,backed up by your confidence and experience are key to franchise financing loans that are successful.

Contrary to the beliefs of many franchisees in Canada your franchisor typically doesn’t play a large part in the actual financing of your franchise. In certain cases they possibly might have some sort of program in place with a finance partner, but that somewhat rare in the mainstream of franchises that sell in the 100-350k range.

So how are these financed then? Good question! One or two specialty franchise finance firms provide acquisition loans in the industry. These typically are for the largest brand names and when ticket size of the purchase is quite significant.

The reality is that the government, via the Canadian BIL / CSBF program has evolved into one of the largest financier of this business segment in Canada. The program has been adopted by hundreds, probably thousands of business owners to facilitate franchise financing loans. And for good reason, low financing rates, great terms, structures, and maximum flexibility on repayment.

In many cases financing of your franchise is complemented by specialty equipment financing for certain assets, as well as working capital loans when that is prudent and feasible. We always remind clients think in terms of acquiring the franchise, and then focusing on ensuring it will be financed properly on an ongoing basis. Running out of money right out of the gate is not recommended! That’s where your business plan and financial projections must be realistic.

Don't let the financing of your franchise overwhelm you - speak to a trusted, credible and experienced Canadian business financing advisor on a finance strategy that makes sense for your particular situation.



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_financing_company_lenders_loans.html

Don’t Risk Losing Out On Franchise Financing Loans - Info For Canadian Franchisees Re: Franchising Loan Success

You’ve Got An Important Decision To Make - So Get Informed On franchise finance in Canada

Information on Canadian franchise financing . What types of loans are available , who is lending , and is there one franchising loan strategy that makes the most sense .




The reality of owning your own franchise business should not be over shadowed by the risk of not obtaining the right, and full amount, of franchise financing you need for a franchising loan. So let’s examine the right, and wrong way, of franchise loans and lending in the current environment.

The right amount of financing you need for your acquisition is often a somewhat stressful time in the total process of buying a business in this segment of Canadian business ownership.

Commercial lending financing does exist in the Canadian environment, it’s a situation of knowing what’s available, and then, of course, executing on completing the financing. Sounds simple, but many Canadian would be entrepreneurs often find themselves challenged by the whole franchise financing journey... and in reality it’s a process, not a journey.

In a perfect world you are looking for a franchise loan that has low or at least acceptable interest rates, nominal fees associated with the transaction, and has the right term or maturity that suits your payback plans and general cash flow situation.

But, does such a loan exist? It actually does, and you'd be surprised where you might find it. Many clients tell us they have spoken to the Canadian bank with whom they typically have had a long term relationship, only to find that little information has been forthcoming as to how they might be able to successfully finance their new business venture .

Naturally any bank that finds you willing to personally pledge and collateralize your home, savings, etc is very anxious to have your business and approve that loan, but it mixing your personal assets with your business venture the optimal solution. We find it rarely makes sense to follow that strategy, buy hey... that’s just us.

In Canada the financing options of franchise lending and loans is available, but somewhat less limited than in the U.S. . . . One or two large firms dominate the major franchise financing opportunities in Canada - these firms focus on the largest name brands and larger transactions that in many cases can range up to several million dollars in total financing required.

But what about the hundreds, even thousands of franchise loans that are required for purchases in the 100-500k range. Who finances those, and if they are financeable does the financing come with those low rates and great terms and structures we spoke of previously?

Actually the Canadian BIL/CSBF loan program addresses that question pretty perfectly. It finances your franchise on terms that compete with the big boys. And we're always rooting for the little guy!

The BIL program assists business purchasers such as yourself to effectively finance the franchise you wish to purchase. Rarely will your franchisor be able to assist you with financing so your ability to prepare a solid 'package' of info and position the package from a solid financial point of view is critical. Other financial solutions such as specialized equipment and asset financing can also round out your financial solution.

Bottom line, franchise financing should not be a risky or stressful time for the completion of your business acquisition. Speak to a trusted, credible and experienced Canadian business financing advisor who can help you complete franchise financing with lending that makes sense... today.

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

Can A Franchise Finance Business Loan Be Creative ? Here’s How Canadian Franchise Finance Works!

Is it actually possible to get ' creative ' when considering a franchise finance business loan for you new Canadian role as an entrepreneur in franchise financing? There are some tried and trusted rules we use in the franchise lending area, but a little creativity has never hurt anyone we believe!

If you haven’t considered how to finance your new business in the franchise industry then we feel it’s probably a little too late in some ways, as your ability to finance your business properly we think has a lot to do with the ultimate growth and success of your business. There are very focused lending sources for the franchise area of financing in Canada - the trick of course is to know what they are and more importantly how you can navigate the ' maze ' successfully.

The reality is that if you have some industry experience in your new business and a proper finance plan you have a much better chance of financing your business properly.

So, who can you turn to in terms of creativity and resources for franchise financing? Clients are amazed when we tell them the most creative partner in franchise financing in Canada is none other than the Canadian government !How could that possibly be? Simply because a program guaranteed by the government and administered by the banks could not be any more creative than this.

The program is the ' BIL ' loan program, and it provides you with financing up to 350k for your new business. Are the terms onerous? Hardly! The essence of the program is a 5-7 year term loan, with great rates, limited personal guarantees, and some other elements of flexibility. If that isn’t creative then we don’t know what is!

Naturally all the creativity in a business loan of that type for your franchise finance scenario should not be reliant on just one lender - the other lender is someone you know very well. Yourself. That's simply because when you look at the total financing of a franchise in Canada the two components are simply debt (the funds you have borrowed) and the equity, or money you have put in yourself. These equity funds, i.e. your commitment to the business, typical come from savings, the proverbial ' friends and family ' support, and investments or collateral that you have available.

Getting back to our key subject of creativity, our above noted BIL loan program only covers certain aspects of a franchise finance scenario. You can augment that loan with flexible equipment financing that has low down payments and extended amortization terms, as well as, in some cases, a working capital term loan.

We never forget to remind clients that the franchise financing plan is a two stage process, acquiring the business, and making sure they have some capital and funding to operate and grow their new business.

In summary, you can be creative when you are looking for info on how Canadian franchise finance works. You need knowledge on what funding sources are available that are specialized to the franchise industry, and assistance in executing a proper financial plan. Speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in maximizing that creativity!

-


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_finance_business_loan_financing.html

Worried About Getting A Loan For A Franchise ? - Here's your 2011 Franchise Financing Guideline!

We know you'd rather start the New Year off with a positive attitude about your new role as entrepreneur - let’s demonstrate how you get a loan for a franchise and how franchise financing works in Canada.

Buying a franchise is clearly one of the bigger decisions you'll make in your personal and business life, and you want to be able to do that with specialized information and assistance to help you succeed.

We would never say there are a large number of ways to finance a franchise in Canada , but there are some tried, tested, proven and recommended methods and strategies and we'll show you how they work!

You never want to feel you have been pushed or misguided when you are thinking of getting a franchise financing loan. That's where professional info is always the best solution.

We're the first to agree that the attractiveness of buying a franchise is a powerful concept - you're literally buying a proven formula and it’s no secret that you have a better chance of surviving if you purchase a franchise as opposed to starting your own independent business that has no track record.

So when you decide to finance that franchise the ' legwork’... if we can call it that, is important. Your goals are threefold actually, you want to be able to successfully purchase the franchise, ensure you have some capital to operate it, and finally, growth is important to your overall success, so you want access to growth capital for your business if you need it.

The majority of franchises are cash flow based, i.e. the restaurant industry, so operating capital and growth capital are not as important in those scenarios. But if you are purchasing a business that has receivables, inventory, and equipment needs, well... be aware that those items need working capital financing.

Franchise financing has three parties to it, yourself as the borrower, the franchisor itself, and of course the finance firm or bank. Generally most franchisors in Canada will determine if you are a qualified candidate for them - that includes a combo of business and or industry experience, as well as some sort of qualified financial credit check on yourself that determines you have the wherewithal to successfully purchase a business.

You only need two things to finance a franchise and get a loan for a franchise. Simple, right. Well those two things tend to be the 2 items that our clients worry about - they are Debt, and Equity. Equity is of course the amount of funds that you personally will put into the business - debt is what you'll borrow of course.

In Canada the current environment calls for a 30-50% range owner equity infusion... this number in our opinion seems to have crept up over the years. The debt or loan for franchise acquisition comes from predominantly the government. The government!! clients ask? Yes, because the majority of franchises financing in Canada are done under a special loan program called the BIL/CSBF loan program. To qualify you need a business plan, and miscellaneous info required to support your application.

This loan eliminates a huge part of the risk in getting a franchise, because your personal guarantee is limited, thanks to our friends in Ottawa who sponsor the program. Also, and we think this is great; the loan finances things like leasehold improvements, which typically would be impossible to get elsewhere.

Speak to a trusted, credible, and experienced Canadian business financing advisor who will assist you to complete franchise financing successfully. Getting a loan for franchise finance is not as hard as you think, if you have an expert on your side in 2011.
--

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 6 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_financing_loan_for_franchise.html