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The 5 Most Common Questions About Franchise Financing-Answered!
Congratulations on starting your franchise search! If you’re reading this post, it’s clear you’re already embarking on, arguably, the most important step: your due diligence. Buying into a franchise generally requires a significant investment of your time and money, so before you go all in, you need to cover your bases.
If you’re new to franchising, financing is likely one of the first hurdles you’ll face. Check out these five answers to the most common questions about franchise financing to help you best navigate your new decision:
Topics of Discussion:
- What is Franchise Financing?
- How much funding will I be able to get?
- How much does a franchise cost?
- How do I get approved for franchise financing?
- Do I need the assistance of a franchise attorney?
1. As a new business owner, you’ll likely need to use franchise financing as a way to secure the necessary capital to start and grow your franchise establishment. This financing may be used to sign a lease on a new franchise location, purchase or lease new equipment or technology, train staff, and more.
2. The amount of funding your new business can obtain will depend upon a variety of factors. This includes personal facets, such as your credit rating and how long you’ve been in the industry, in addition to facets of the franchise you choose. Brand and concept recognition of a proven franchise can play a major part in how much funding and what terms you’ll receive from a lender.
3. The cost of buying and operating a franchise will depend greatly on a number of factors including what industry you opt to franchise in, how much office or storefront space the concept will require, what state and municipality you want to buy and operate the business in, how much overhead the business will require, and much more. Some franchises can be launched for less than $50,000, while others will require investors to have $500,000+ in readily available liquid capital.
Disclaimer: This information is not intended as an offer to sell, or the solicitation of an offer to buy, a franchise. It is for information purposes only. Currently, the following states regulate the offer and sale of franchises: California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Oregon, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin. If you are a resident of or want to locate a franchise in one of these states, we will not offer you a franchise unless and until we have complied with applicable pre-sale registration and disclosure requirements in your state. Franchise offerings are made by Franchise Disclosure Document only.
