Franchise Brokers Association BLOG

One of the greatest advantages of investing in a franchise over building a business from scratch is the ability to leverage your investment.

While some banks will still loan funds to a qualified individual to start a business, they are few and far between.  With the state of the industry, you now have to provide not only more but a higher quality of information to the lenders to improve your chance of getting a loan.  When investing in a franchise, the loan process is easier.  Franchise companies have a track record of other business owners who have run this type of business successfully.  They provide the FDD which contains exact start-up costs, materials, suppliers and more.

Franchisors many times have relationships with lenders that help their franchise prospects apply for and obtain funding.  A franchise broker can also give you access to lending information, companies that they recommend and would (or maybe have) used, giving you direct access to companies and contacts that know the benefits of franchising and helping your chances of getting the loan to start your business.

This all makes sense, if you were loaning your money, wouldn’t you want to see the highest chance of success possible for your borrower?  Franchising has proven time and time again to provide this.  Therefore, banks prefer a business with data, statistics, and proof to back up the borrower’s forecast.

Learn about leading franchise funding sources and franchisors with funding connections, contact us here.

Franchising Means Support

What do the most successful people in business have in common?  Each one became successful by surrounding themselves with people that are more successful than they are.  It makes absolute sense, you must surround yourself with successful people, those who can support you, assist in the growth of your business and share their knowledge. 

With a franchise you are awarded the opportunity to work with hundreds of successful franchisees and the team that supports them.  We always explain to our clients that if they want to be successful, they must use the support of the Franchisor.  They are busy working on the business.  They are developing it and creating the tools, resources, systems and staff that is necessary to make the business run smoothly and effectively.

When choosing a franchisor, always pick the one that gives you the most support and then use it.  There are countless stories that come across our desks daily of all the successful franchisees that we have placed in solid, thriving franchises.  That could be you!  If you are or become a franchisee, use the support of your franchisor, the tried and true systems, tools and resources available to you.  They are there to make you successful!

Contact us to learn about successful and supportive franchise companies and to discuss which franchises match your entrepreneurial goals.

Build Wealth With Businesses

How many millionaires can you think of?  Of those, how many of them have owned and built their own business to become a millionaire?  The book The Millionaire Mind by Thomas J. Stanley reports that 2/3 of all millionaires are business owners.  Why is that?  The simple answer is that businesses have two equity streams.  You earn a living with a business just like you do with a job, but you also build equity.

If you have ever looked into purchasing an existing business that is for sale, you will find that it is much more expensive than starting a business from scratch.  In fact, one of the franchises that we work with costs around $50,000 to get up and running.  By the fifth year in business the average Franchisee is grossing over $600,000 and many of them have hit the million dollar mark.  When a Franchisee goes to sell that business, they can charge between half to two times the gross sales.  That works out to be $300,000 in the worst case scenario and $1.2 million in the best case, assuming you only make $600,000 per year.  That is up to 24 times your original investment, and remember while you were working on your business and building equity, you were also taking a salary.  Show me a stock that can give you that kind of return!

There is risk in business just as there is in any other investment.  When you consider franchising with the RIGHT franchise system, your risk is dramatically reduced.  You will start with the end in mind, and think about what kind of return on your investment you want.

Franchising isn’t a magic pill, but with the right research, hard work and dedication to your system, a positive ROI on your business is absolutely within your reach!