I’m about to approach my bank about funding my franchise. Do you have any tips?
The first tip is not to approach the bank until you have discussed with the franchisor its process for doing so. All reputable franchises will be known to the various banks’ franchise sections and other sources of funding. In most cases, there will be agreed formats for applications and processes for submitting them. This makes the whole exercise a lot simpler and more likely to be successful.
The second tip is to make sure you understand as much as you can about how the business will operate and where the figures came from that go into the funding plan. This applies whether or not you get help in completing that plan from the franchisor or an approved third party, such as a recruitment consultant.
The important thing is that any figures given to you by the franchisor should be based on fact, ie the results of either company owned or existing franchised outlets.
For the larger investment franchises, you may still have to meet a business manager from the bank, who will want you to demonstrate your understanding of how the business is likely to grow and what the key performance indicators will be, so be ready for some awkward questions.
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