Dealing with franchise costs may not be as difficult as you think. There are many different ways to come up with the money to get your business off the ground. These options start with you, the franchisee.
Many franchisees set goals for financing the costs of their new businesses with the following sources of funds:
- Savings accounts, stocks and bonds
- Property liquidation
- Home equity loans
- Retirement accounts
- Severance pay
- Loans from banks and other financial institutions
If you're going to seek a business loan to cover your costs, you should be aware that you might not obtain all of your funding by borrowing. Many banks and financial organizations will expect you to produce about 20 to 30 percent of the startup capital on your own. When you put your own cash at risk, lenders feel that you are more likely to put your best effort into making sure your business succeeds. You will also be expected to produce a solid business plan.
Good News About Franchise Costs
Sometimes, hearing about the cost of starting a franchise may be overwhelming to a potential buyer, but there is good news to consider. First, franchise opportunities are available at a full range of investment levels. In fact, you could start some of them with just a couple of thousand dollars. Second, it is often easier to secure loans for franchises than it is for independent businesses.
For help with choosing the right franchise, rely on us at MatchPoint Franchise Consulting Network. We offer free consultations to prospective business owners. We also offer online education to help you learn about franchising and goal setting.