Franchise Loans In Canada . Don’t Let A Franchisee Financing Loan Be A Disaster

Tweet

How To Finance A Franchise In Canada

Franchise loans in Canada. Either not getting the one you want or need just might be a disaster when it comes to your entrepreneurial dream for a franchise purchase which all of a sudden appears to have gone up in smoke!

 

When all of your plans for a small business loan go awry when it comes to your franchisee financing loan almost everything is at risk, including your planning, potential franchisee fees or down payments you have made, deposits on a premises, etc. Let's examine some key elements of Canadian franchise finance success.

 

KEY ELEMENTS OF FRANCHISE FINANCING SUCCESS

 

Financing success in the franchise industry will come from both you and one or a combination of several franchising lenders.  A common belief which we can dispel pretty quickly for you is that your franchisor is not going to be the one that plays a major role in the financing of your business -  We guess you can say they are with your morally and spiritually, but not financially! Any form of assistance your franchisor might provide will typically be indirect in nature, sometimes in the form of a referral to a lending institution or a Canadian business financing advisor.

 

OWNER CONTRIBUTION PLUS EXTERNAL FINANCING

 

All businesses require start-up capital from the owners, so don't think that franchising in Canada is any different.  That is your owner contribution when it comes to financing the key elements of your new business - items such as construction, leaseholds, equipment, the franchise fee, opening inventory, and potentially even real estate. Franchise owners should have a clear idea of funding both the purchase as well as day to day working capital needs to run and grow the business.

 

DON'T  MAKE THE MISTAKE OF NOT PLANNING PROPERLY!

 

Right about here is where many franchises make a huge mistake. And that mistake? It's not focusing or planning for working capital for items such as salaries, wages, lease and loan payments, franchise royalties, etc.  When working with clients we are always focusing on the ' working capital ' component of your business plan, not just the start-up financing, which often seems to be the sole focus of the franchisee.   Ensure you have a solid business plan and executive summary and cash flow projection package. At 7 Park Avenue Financial, we prepare business plans that demonstrate your ability to make franchising a success.

It's important that franchisees demonstrate a good personal credit score and work history and experience as lenders rely on that as part of the franchise formula for long term success.

 

THE FUTURE IS UNLIMITED!

 

We could even take that one step further and say that you might want to even start considering at this point an expansion plan if you choose, down the road, to acquire multiple franchise locations, in the same or another industry. Franchise financing options get better with more success in your initial purchase.

 

That brings us to the key point of ' experience '. When we apply for jobs and positions in the corporate world our potential employer is focusing on our EXPERIENCE.  So that's why it's important also to ensure your franchisee financing loan is adjudicated with the idea that you as a business owner have relevant experience in your industry. A solid example is the restaurant and hospitality industry, where long hours and people and operational expertise are critical.

 

4 SOLID SOLUTION TO FINANCING YOUR FRANCHISE

 

In Canada, your franchise loan is not necessarily going to come from a conventional lender. In fact, it almost always will not. Your financing will come from various financing options -

 

Specialty franchise lenders

The BIL/CSBF program - (Our preferred choice!) This is the Canadian version of  U.S. ' sba loans' !

Leasing companies

Private investors

 

COST OF FINANCING

 

Interest rates and terms will vary depending on the type of financing you choose and your overall personal credit history. The interest rate in funding your franchise may be a blended rate as often different types of financing are cobbled together. In some cases, you might be buying an existing franchise and a seller financing component may also be an option based on the nature of the franchise agreement and approval of the franchisor.

 

Repayment terms themselves will vary based on the nature and amount of financing you need, and whether it's a debt of cash flow type of funding. In certain cases, there may be a real estate component to your transaction, which is often financed separately in a special purpose entity type of legal incorporation.

 

CONCLUSION

 

Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in ensuring your franchise business finance needs become not a disaster, but a success! Whether it's bank loans or non-bank business loans we want to help the entrepreneur in the franchise industry - a key part of Canada's economy.

7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

http://www.7parkavenuefinancial.com

Click Here For 7 PARK AVENUE FINANCIAL website !



7 Park Avenue Financial provides value-added financing consultation for small and medium-sized businesses in the areas of cash flow, working capital, and debt financing.



Business financing for Canadian firms, specializing in working capital, cash flow, asset based financing, Equipment Leasing, franchise finance and Cdn. Tax Credit Finance. Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations.

' Canadian Business Financing With The Intelligent Use Of Experience '

ABOUT THE AUTHOR

Stan has had a successful career with some of the world’s largest and most successful corporations. He is an experienced

business financing consultant

.

Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.


Stan has over 40 years of business and financing experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in-depth, hands-on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.

Click here for the business finance track record of 7 Park Avenue Financial



Stan Prokop
7 Park Avenue Financial/Copyright/2020

How To Get Franchise Financing In Canada

Tweet

How To Finance A Franchise In Canada

 

 

Financing a franchise and the purchase of that business is no doubt on of the larger decisions in the entrepreneurs life. It is safe to say that when we meet potential franchisees at 7 Park Avenue Financial they want some solid options on funding and financing their new business.

Franchise loans in Canada to some extent are limited vis a vis who finances these businesses - it is therefore important to know who the players are and what lending options are available from franchise lenders.

Business people can be forgiven when they seem skeptical around whether franchises can be easily financed in the current business environment . After the 2008-2009 worldwide recession business loans of all type in many ways became more difficult to access. The bottom line though is that funding is still available, and the lending criteria and solutions are not as demanding as they might think.

No business loan is a cake walk - therefore the preparation in the franchise loan process is key to ultimate financing success.

 

How Does Franchise Financing Work ?

The way we like to look at the ' being prepared ' process is essentially in two key categories - having a strong proposal and ensuring you can meet the basic qualifications for the franchise loan . And by the way, that also means being able to prove you have some solid business experience. Keeping up your part of the bargain is also key ! What is that?

It's your equity investment of down payment into the business, the balance coming from your franchise finance loan funding. Suffice to say that there is typically no 100% financing in this area of Canadian business.

One key aspect of franchise risk is that fact that it is probably actually more easy to secure business franchise funding than any other normal start up since you have the benefit of a ' brand ' and ' reputation' backing you .. I.e. the Franchisor.

When it comes to your ' deposit ' or equity position in the loan these funds typically come from various parts of your 'net worth '. While you may think that you have to tap into major savings or home equity, or collapse RRSP's, the reality is that you need to come up with anywhere from 20-40% , generally speaking , of your desired loan amount.

Personal credit history is also a key aspect of the franchise loan .Unfortunately, and we run into this almost all the time, many franchisees don’t have a sense of how the franchise funding lenders assess their personal credit history. It's more simply than you think. The entire personal credit history of everyone in Canada comes down to a numerical score at the credit bureau. Borrowers can easily check their credit scores with a local credit bureau, and by the way the 'magic score ' in most business loans is 650. Poor credit histories make it close to impossible to achieve almost any type of business loan, including franchise loans.

Next steps generally revolve around assessing your financing options. For some of the larger franchise chains one or two well known independent finance companies can handle all your franchising needs from a lending / loan viewpoint. But, here’s the kicker, the majority of franchises in Canada are funded by the Government Small Business Loan program .

Key benefits of the loan include:

Flexible rates

Terms of 2-5 years

Attractive structures including some pre payment and interest only options,

Low personal guarantees - typically 10% of the loan

Naturally you want to expedite your transaction. That is done by ensuring you have a crisp business plan and financial forecast in place - highlighting your business experiences, profit and cash flow potential, and info on the success of your franchisor as your new partner in Canadian business. You simply want to focus on one thing, showing your ability to repay the franchise loan.

Supplemental financing can also be achieved quite creatively if you have the right assistance - that might come in the form of a merchant advance loan against future sales, equipment leasing, or a straight unsecured working capital term loan.

Franchise Finance Options In Canada

So the good news is you have some great options in franchise finance and financing your new business. It’s up to you to assess those options, be prepared to present your plan. Want some great assistance? Seek out and speak to a trusted credible and experienced Canadian business financing advisor with a track record of business finance success in franchise finance funding.


7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

http://www.7parkavenuefinancial.com


Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .

' Canadian Business Financing With The Intelligent Use Of Experience '

ABOUT THE AUTHOR
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.

Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.


Stan Prokop

How To Finance A Franchise In Canada

Tweet

Can You Finance A Franchise ? Yes You Can !

Canadian entrepreneurs continue to explore franchise acquisitions in Canada as a way to maximize on the business opportunities provided by the franchise industry. Entrepreneurs evaluate franchising because it provides them with an ability to generate sales and profits from established business models – they can build equity in businesses and enjoy the benefits (perceived or otherwise!) of self employment and the entrepreneurial dream



As you start to formulate your ideas around purchasing a franchise the concept of how o you will finance your new business should be very close to the top of your list. Many clients we talk view the actual financing of the franchise as the largest obstacle to achieving self employment success.


The reality is that anyone with a reasonable business and work background, coupled with a stable financial situation (good credit bureau history, etc) should be able to successfully finance their venture.


Is there a secret to franchise financing in Canada! Yes, there is, and don’t by surprised by the answer , which is simply that you must have a thorough and solid proposal in hand, and the right people need to see that proposal. Unfortunately that isn’t as easy as it seems when you searching for franchise loans,


Sohow are franchises in Canada actually financed? During the last couple years, due to the world wide economic slowdown/recession franchise financing became a smaller fish bowl so to speak. The methods in which franchises were financing in some cases actually disappeared, and in most cases simply had the ground rules changed relative to whats required and how its works and how long it takes.


In Canada franchises are financed by, in most cases a government sponsored and subsidized loan that comes under a program known as the CSBF loan program. Additional a very select number of firms offer specialized franchise financing loans, and in our experiences we have complimented these two programs with basic lease financing of assets plus in most cases a working capital cash flow loan or an introductory line of credit to facilitate daily operations and long term growth.


So is there a key to success in franchise finance ? I Absolutely, and it starts with a solid executive summary and business plan that has some reasonable financial projections and assumptions attached to it. That is one critical key to understanding franchise loan requirements . The basic elements of that document are the business description, an overview of the basic business model and industry, financial projections, and a focus on the strengths of your business and its expectations of profits. Those profits will of course be cash flow to repay your franchise loan and debt.


We recommend to all clients considering and entrepreneurial career as a franchisee in Canada to discuss your franchise financing options with a credible and experienced advisor in franchise financing, sometimes known as a franchise loan broker .Keep your financing objectives at the very top of your list early on in your process, plan well, and present your proposal once, and properly. You will soon be en route to a successful new business with sales and profit growth!





7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

http://www.7parkavenuefinancial.com


Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .

' Canadian Business Financing With The Intelligent Use Of Experience '

ABOUT THE AUTHOR
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.

Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.



Stan Prokop

Canadian Franchisee Loans and Business Funding - 4 Secrets To Financing A Franchise

Tweet

Information on financing a franchise in Canada. Loans and funding tips you can use as a franchisee seeking business funding for your start up business in the franchising industry sector you have chosen

The inside edge. You want it, we have it! Have we got some tips and secrets to share for you.

We're talking about financing your franchise - the successful completion of your entrepreneurial dream in Canada. As a franchisee you want to be aware of your options in loans and funding programs that are geared specifically to financing a start up business in the booming franchise industry.

We're going to discuss 4 key elements of a proven formula for franchise success. What are they? Simply speaking its ensuring you have a business plan that accurately resembles the financial aspects of your business. Number two is the types of emphasis that is put on your own personal background and credit history. Number 3 is the knowledge of franchise financing options in Canada, and number 4, (often # 1 in your mind probably) the amount of personal funds you have to commit or invest to get your business going and your franchisee funding approved.

Let's dig in! OPM. What is it? It's stands for other peoples money and its critical you understand that a franchise is composed of two elements with respect to your financing plan - debt (what your borrow) and equity (what you put in). Our key point here is simply that while there is no proper mix of what works for the combination of those two elements. No franchise is financed with 100% borrowed funds - conversely you don't want to ' pay cash ' for your business and risk all, or a lot of everything you own (house, savings, etc) for a start up business such as a franchise.

We will also share with you that some of the very specialized franchisee loan program in Canada typically require a 30 - 40% owner equity, or down payment. That can be achieved in several different ways.

Should you tap into your retirement plans to fund your franchise? That's not our call, but if you have capital outside your savings we would not recommend collapsing RRSP's, or taking out home mortgages, etc for the purpose of financing and funding your franchise.

Clients often ask how their personal credit history affects their ability to get franchise financing. In general we can say it's a key point in the whole approval process. Many Canadians aren't aware that the entire credit history system in Canada is based on a simple score. You should have a score of at least 650 to be successful in traditional franchise finance. So check your score in advance. And by the way, higher is better!

The business plan is a key element of your whole package. Many clients don't have experience or financial acumen to prepare a proper plan. Not a problem as you can seek a Canadian business financing advisor, or accountant, etc to prepare your plan. A good basic plan comes at a very reasonable cost.


The business plan is your ' total picture 'of your franchise. Basic elements are yourself, your background and business or industry experience, info on your franchise, and some basic financial projections. Naturally the better recognized and successful your brand the more attractive your perceived chances of success are.

As a franchisee what loans and funding is available in Canada. As unbelievable as it may seem the government of Canada, via Industry Canada, is one of the largest players in your franchise success. A program called the BIL / CSBF program is hugely popular and finances mot franchises fewer than 350k in Canada. We strongly recommend you seek out and investigate this program, it's probably the key to 95% our client's success in financing a franchise with funding that comes with great rates, terms and structures and limited guarantees. Bottom line, check it out!

So there you have it, 4 key elements, and secrets if you will, to franchisee financing success. Summarized... a solid business plan, some good business or industry experience coupled with a reasonable personal credit history, a down payment that is aligned to your overall financing needs and personal situation, and, last but not least, knowledge of programs such as the BIL which are geared toward franchise finance success.

So now you know!

P.S. Good luck in your entrepreneurial dream, and going it alone is never good, so seek the services of a trusted, credible and experienced Canadian business Financing Advisor with a track record of success



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 10 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.


7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653

Fax = 905 829 2653

Email = sprokop@7parkavenuefinancial.com

' Canadian Business Financing with the intelligent use of experience '

ABOUT THE AUTHOR
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.

Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.



Stan Prokop



Article Source: http://EzineArticles.com/6224647

Franchise Loans In Canada : Answers To Your Questions On Franchise Costs Financing

Sources Familiar With The Matter Say Franchise Financing Loans Are .. Available In Canada!

OVERVIEW – Information on franchise loans in Canada . Franchisees have numerous questions on franchise costs financing and here’s some answers


Franchise loans in Canada are, unfortunately still a bit of a conundrum to many entrepreneurs contemplating franchise costs financing alternatives and ' best practices'. We were watching the news the other night and heard the phrase: ' Sources familiar with the matter ...' and couldn’t help but think many of our franchisees wouldn’t mind talking to those ' informed sources ' on the challenges they face in financing their business purchase. Let's dig in.

It's important to understand the types of financing that are required for purchasing a franchise. Predominantly that’s a term loan, but depending on the type of franchise and industry you have chosen it's important to give thought to working capital issues around receivables and inventory, as well as the ability to finance future equipment and leasehold needs to stay competitive.

While the franchisee must be in a position to commit some level of personal capital to the business that typically comes only at the initial purchase stage, As your business is established, has credible financials and cash flow history finance alternatives not requiring additional capital become available .

While the amount of capital from your personal investment will be different for every franchise what makes that amount necessary typically revolves around size of the franchise, franchise quality and reputation, and financing breakdown.

Service franchises always are going to have a lower total financing cost because they are not capital intensive. That's great right? Not necessarily though because service franchises are difficult to finance for the same reasons, there are no tangible significant assets.

We deal with numerous clients that have in fact ‘paid cash ' for the entire costs of a turnkey franchising operation. Guess what though? As sales and revenue projections (dreams?!) don't materialize fast enough the business runs out of working capital. So the franchisee finds themselves asset rich and cash poor.

Fortunately there are effective strategies available to refinance the business and often save it.

Repayment is a concern, mostly for your lender or lenders! So it's critical to spend the right amount of time and access the right expertise in a proper business plan and cash flow. The key things you need to address are realistic sales projections, as well as understanding that in the cases of selling on credit sales does not equal cash. Naturally the amount of sales and profits you need to at a minimum break even are important... although hopefully no business owner enters into business with the goal of only breaking even.

If you're looking for those ' Sources familiar with the matter ' when it comes to franchise loans in Canada seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in addressing franchise costs financing in a manner that suits your needs.


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 10 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 :


7 Park Avenue Financial = Franchise Loan Expertise






Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:

7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Phone = 905 829 2653


Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '

Stan Prokop

Franchise Loans In Canada . Don’t Let A Franchisee Financing Loan Be A Disaster To Your Success !

Avoiding a Franchise Finance Disaster


OVERVIEW – Information on franchise loans in Canada . What is the secret to proper franchisee financing loan approval and success for the Canadian entrepreneur?



Franchise loans in Canada. Either not getting the one you want or need just might be a disaster

when it comes to your entrepreneurial dream, which all of a sudden appears to have gone up in smoke!

When all of your plans go awry when it comes to your franchisee financing loan almost everything is at risk, including your planning, potential franchisee fees or down payments you have made, deposits on a premises, etc. Let's examine some key elements of Canadian franchise finance success.

Financing success in the franchise industry will come from both you and one or a combination of several franchising lenders. A common belief which we can dispel pretty quickly for you is that your franchisor is not going to be the one that plays a major role in the financing of your business - We guess you can say they are with your morally and spiritually, but not financially! Any form of assistance your franchisor might provide will typically be indirect in nature, sometimes in the form of a referral to a lending institution or a Canadian business financing advisor.

All business require start up capital from the owners, so don't think that franchising in Canada is any different. That is your owner contribution when it comes to financing the key elements of your new business - items such as construction, leaseholds, equipment, the franchise fee, opening inventory, and potentially even real estate.

Right about here is where many franchises make a huge mistake. And that mistake? It's not focusing or planning for working capital for items such as salaries, wages, lease and loan payments, franchise royalties, etc. When working with clients we are always focusing on the ' working capital ' component of your business plan, not just the start up financing, which often seems to be the sole focus of the franchisee. We could even take that one step further and say that you might want to even start considering at this point an expansion plan if you choose, down the road, to acquire multiple franchise locations, in the same or another industry.

That brings us to the key point of ' experience '. When we apply for jobs and positions in the corporate world our potential employer is focusing on our EXPERIENCE. So that's why its important also to ensure your franchisee financing loan is adjudicated with the idea that you as a business owner have relevant experience in your industry . A solid example is the restaurant and hospitality industry, where long hours and people and operational expertise are critical.

In Canada your franchise loan are not necessarily going to come from a conventional lender. In fact it almost always will not. Your financing will come from:

Specialty franchise lenders
The BIL/CSBF program - (Our preferred choice!)
Leasing companies
Private investors

Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in ensuring your franchise finance needs become not a disaster, but a success!

7 PARK AVENUE FINANCIAL
CANADIAN FRANCHISE FINANCING EXPERTISE


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 10 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-loans-franchisee-financing-loan.html



EMAIL - INFO@7parkavenuefinancial.com
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Phone = 905 829 2653
Fax = 905 829 2653
Email = sprokop@7parkavenuefinancial.com



















Stan Prokop

Man Buying A Business Receives Financing Approval! Surprised? Here’s Some Info On Franchise Loans In Canada

Franchise Financing In Canada


OVERVIEW – Information on franchise loans in Canada . Get the right financing when you’re buying a new or existing business from a franchisor .





Franchise loans in Canada. When you're buying a new or existing business in this large segment of the economy should you be surprised to read our headline regarding financing approval? That depends of course... on whether you yourself have been approved, or declined!

There is of course some ' right ways ' to finance a busines in the franchising industry. Top experts in the field can provide you with both the guidance to ensure your finance request is approved, as well as minimizing the time it takes to get to the goal line - that time often being the most frustrating part of your search to finance entrepreneurship.

We continually remind clients that they must focus on a total solution, that being both the turnkey financing of their project, as well as taking into consideration working capital and growth financing. Those latter two are sometimes forgotten, leading to disastrous consequences.

In Canada financing for franchise loans is provided by a small handful of resources - they include specialized finance companies, the government SBL loan, and third party lease and finance companies.

Using any one or a combination of the above financing resources effectively puts you very quickly very close to the goal line when buying a business.

Many new franchisees associate ' the bank ' as the source of their possible financing. They are thinking in terms of what we could call ' conventional financing ‘. So the question then is very simple. Do Canadian chartered banks in effect finance franchise loans? The answer is a resounding yes, couple with a resounding watch out.

While our bank system has the lowest rates in Canada, as well as generally flexible terms the reality is that a conventional loan of this type requires that you put up personal assets, quite often the equity in your home. That of course requires approval from your husband or wife, whom many franchisees tell us is more difficult than negotiating with a banker.

We further remind clients that they would do well to consider the concept of separating their personal life and finances from business finances - that is just common sense, and one of the many reasons you also consider incorporating your franchise into a separate legal entity. However, in fairness to our great and strong banking system in Canada almost all the banks have embraced the franchise industry and have some experts in their system who can address your needs. It's just finding out which branch they are located at!!

So what about the franchisee who can or doesn't want to pledge all those personal assets (you have to have assets to pledge them apparently)? One solution is of course to partner with someone who can assist in relieving the total financial burden of the business. However, in our own experience a lot of issues (mostly character and personal!) arise in partnership challenges of managing and owning a business. Going alone, while lonely is often the best solution.

In general the potential Canadian franchisee requires a reasonably good personal credit history, as the franchise lender wants to know you manage your own personal finances in a manner that reflects how you will manage your business.

So, when you plan or system to successfully enter the franchise industry seek out and speak to a trusted, credible and experienced Canadian business financing expert for assistance with franchise loans in Canada . Your focus? Doing it right... and quickly.

7 PARK AVENUE FINANCIAL
CANADIAN FRANCHISE FINANCING EXPERTISE

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_loans_financing_buying_business.html

Franchise Loans In Canada . 4 Critical Components of Franchising Financing And Lending For Canadian Franchisees

Franchise Financing In Canada


Information on franchise loans in Canada . When it comes to franchisee financing and lending the applicant needs to identify key requirements of franchising loans.




Franchise loans in Canada. Is the financing for a franchisee opportunity really any different than any other type of business lending / loan? The answer is no... And yes ... so let's spend a bit of time defining those differences!

It's very safe to say that franchising is a sought after business model in Canada... all the reasons are obvious - proven business strategies, demonstrable examples of your success from existing franchisees, etc.

So the immediate problem then becomes: Where do I get the cash and financing to complete a successful transaction. Here's where your financial search begins, and as we noted, there are some strong similarities in what you need for any business loan - some of them being a business plan and reasonable financial projections.

Although the majority of business financing in Canada requires personal guarantees from the owners as a back up plan for your lender there are in fact ways to limit your personal guarantee when it comes to financing a franchise . One of the best options in that area is to consider a BIL/CSBF loan, which is a federally sponsored program that significantly limits your personal guarantee to 25%. Now that's good news for the prospective franchisee.

You can of course explore financing options with your franchisor - we very quickly point out to clients they should expect some solid advice from the franchisor as to how things might work, but certainly don't expect direct financing in the form of a loan, etc. That’s your job!

Are there some potential franchisees who actually expect they can get 100% franchising for their proposed new business? Unfortunately there are, and even more unfortunately they are wrong. You do need a personal equity component to your overall finance strategy. What amount is that? We can safely say is a minimum of 10% permanent equity, but you should be able to demonstrate access to other working capital sources that will at a minimum be able to help you get out of the gate until your revenue expectations are starting to be met .

So where in fact do franchise loans and financing for your new business come from in Canada. In reality it's a small handful of sources. Oh and by the way, we never recommend to clients that they entirely pay cash for their new business, as you do no want to put all your financials resources at risk in the even of a business failure or downturn. And by the way, That’s just another great reason ensure you are incorporated.

Lending for franchises in Canada comes from a small handful of specialized finance firms, although the majority of franchises under 350,000.00$ are in fact financed by the government small business loan. Financing can also be accomplished by cobbling together those two solutions with equipment financing and other forms of alternative working capital from non bank lenders.

Collateral. Is it required from a franchisee for franchise loans? In general, we can say it is not. Although your overall credit history and personal net worth are factors in franchise lending, or any lending for that matter, a properly structured franchise loan will in fact not require collateralization of personal assets ... and that's a good thing!

Your overall business experience and personal demeanor in your franchise loan presentation is key to a good financing package. Lenders look for people that have business and marketing savvy and who come across as positive and successful.

We identified in our title today 4 components of a successful finance lending strategy. In case you have missed them we've purposely kept them subtle, but in fact they are character, capacity, and collateral and credit history. Those by the way are components of any successful business financing, so as we said at the outset, while there are some nuances in franchise lending common sense business applies also!

Speak to a trusted, credible and experienced Canadian business financing advisor who can assist you to ensure lending for your franchisee dream is met with success.

7 PARK AVENUE FINANCIAL
CANADIAN FRANCHISE FINANCE EXPERTISE



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/franchising_loans_financing_lending.html

Police Arrest Batman! Franchise Loans In Canada @ 0% Interest . Financing Your Franchising Cost - Realistically!

Canadian Franchise Finance



Information on franchise loans in Canada . How do franchisees realistically approach the franchising cost of financing their entrepreneurial purchase .



Franchise Loans in Canada. At 0% financing? Financing franchising cost at that rate would be great? Hardly realistic, right? And we won't even weigh in on why the police would even consider arresting a great superhero such as Batman who protects the city from evil.

So if those two things don't exist, what is in fact the real scoop on franchisee finance in Canada? Let's examine some more realistic issues around the purchase of your business, either existing, or new, in the franchise industry.

A common misconception exists that potentially you might be able to in fact finance 100% of your purchase via some sort of loan vehicle. Unless you've got some special relationship with a lender in Canada that we're not aware of that’s clearly not going to happen.

Typically anywhere from 10-40% of a final purchase price has to be financed by you the owner. And while all of these funds might not necessarily be a permanent investment, they are still needed to demonstrate some working capital conditions that must be met by traditional financial loan criteria. The financial term for this is of course the proverbial ' skin in the game '!

Can you purchase a franchise without a solid personal credit rating and net worth? The short answer, in general, is ' NO '. Whether you're financing franchise cost of purchasing any other business in another industry the reality is that a solid emphasis is based on the way you have managed your personal financial life which lenders use as a barometer as to how you'll manage your business affairs . So credit score, beware!

Is collateral required when financing a franchise? A general comment we can make is that it is not. Typically external collateral is not really a part of any franchise finance decision. Many clients we speak to feel they might have to put their home at risk, and we can commiserate with that thought, but if your franchise is ' PROPERLY ' financed then typically just your owner equity component is required.

Can you get away with getting approved for franchise loans without a business plan? We certainly say ' no you can't ' to that one, and in fact if you're smart the business plan will be a great measurement stick for how you understand the financials around your business, and a great way to ensure you reach some of those sales, cash flow, and profit metrics down the road ,

A business plan should not be as daunting a task as you might think just because you might not have experience in this area. Essentially it's a recap of your business experience, the franchisor and industry you're going to participate in, as well as a financial plan around sales, profits and cash flow and loan repayment. Not that difficult, right?

So, superhero arrests by the cops? 0% non subsidized financing? Doubtful. But if you want to get some realistic financing advice around franchise loans and franchising cost financing in Canada speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your entrepreneurial purchase.






7 Park Avenue Financial is an Expert in Canadian Franchising Cost Financing



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_loans_franchising_cost_financing.html